A few Fedheads are wondering publicly about how QE affects the economy. I have to ignore that stuff because it makes me want to puke. It is patently obvious that QE has virtually no effect on the economy, and even crushes the middle class through wage suppression, while enriching the 1%. Meanwhile Bernanke goes out on his ego schtick, proclaiming his wonderfulness.
We got another data point today that illustrates just how insidious QE has been. With a so so November, US Factory Odors still stink.
The headline seasonally adjusted fictitious number for nominal factory orders rose 1.8% from October to November, a little better than the consensus guesstimate of a gain of 1.7%. The actual change in real orders, adjusted for inflation, and not seasonally manipulated, was a drop of 3.6%. That is so so for a November. The average drop for the prior 10 Novembers was 3.9%.
The year to year gain was 2.8%. They’re all the way back to 2006 levels. Wow. A trillion in Fed money printing was associated with a 2.8% gain in factory orders. That’s quite a manufacturing renaissance. Shall we note that manufacturing growth is slower than GDP growth? Meanwhile, stocks rose 27.5% over that time. Somebody got richer, but it wasn’t factory workers.
Did you notice that Boeing was able to hold a gun to the head of its skilled machinists, successfully forcing them to take a pension cut? The labor movement is dead in America. Corporations are feudal lords, doling out crumbs to the peasants. The middle class sinks further down the economic scale. This trend does not end well.
Way to go Ben. Nice work. And for you Fedheads wondering how QE affects the economy, look no further.
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