Shenandoah

By John Galt

October 15, 2009

The one thing that is fun about data is that when people find abstract ways to apply it to reality. Everyone who reads these pages probably looks at the DJIA priced in gold but let’s revisit one of my favorite charts, the DJIA and GE priced in the good old greenback. We’ll review the DJIA in current dollars, 1967 dollars (gold standard) and 1982 dollars (when Reagan ruled) and analyze just how much we have debased our currency and the technical tricks you can pull with a dollar debasement. First, let’s review the purchasing power of the US Dollar in 1967 and 1982 dollars as they seem to have stabilized for the past few months:

Ouch. That’s going to leave a mark. An almost 85% debasement of our beloved junk buck. Now in 1982 dollars:

At least Obama can’t take the blame for that ski slope but his puppetmasters at the Fed sure know how to destroy a currency and as a result, eventually, a nation.

With those cheery graphs as a base let us take a look at the Dow Jones Industrial Average in 1967 and 1982 dollars first:

A very telling chart and even though I am no master technician, the destruction of the USD shows up in the DJIA chart when priced in constant gold based dollars. Let’s look at the same chart in 1982 fiat dollars:

When you look at the chart with all three overlaid it does smooth out the double top but shows the currency destruction in the early part of this decade when Greenspan decided to accelerate the printing presses and create the bubble to save the tech bubble.

That pretty much tells the tale. When you look at the DJIA in current dollars the double top feature is not as apparent but you can understand why I like to start contemplating what we are witnessing in a stable currency environment (67 & 82 dollars) versus the wildly fluctuating USD we are now married to thanks to our Bubblefed.

Thus why I am still skeptical of this current “bull market” and why the lack of any sort of stable dollar policy could come back to bite the equity “bulls” in their beefy behinds. Just for kicks, just like the last time I did this exercise, I decided to plot Bubblevision’s parent company OE (Obamam Electric) and see what their stock price looks like in the era of moderately stable dollar days:

Wow! Doesn’t that just make you feel all warm inside if you’ve been holding this turkey since 1998? Dollar debasement is fun and when you apply the purchasing power formula to the stocks that are touted like the cheap whores in Congress waive their bills you begin to realize just how bad our current situation really just might be….

by John Galt

October 15, 2009

Dear Rush,

I know you are upset. I could tell in the fervor of your voice yesterday that the race hustlers and media whores had finally gotten to you a wee bit because they attacked your desire to invest in a sport you have loved all of your life.  I noticed the headlines everywhere  like “Rush Limbaugh Ousted From Group Bidding to Buy St. Louis Rams” from Bloomberg where they quoted the racist Al Sharpton saying:

“It is a moral victory for all Americans, especially the players that have been unfairly castigated by Rush Limbaugh,” Sharpton said in a statement. “This decision will also uphold the unifying standards of major sports.”

You should be upset old friend. The lies were one thing and I hope you destroy the lives financially of those who spread them. But now it is time to ram them back, if you’ll pardon the pun. No more Mr. Nice Guy. No more keeping your book of secrets. Let loose with everything you have because as you have stated so eloquently they are going to destroy your livelihood anyways with the new Ministry of Propaganda and Diversity being installed within the FCC.

As for the NFL, this is not unexpected. While I was disgusted by the statements of Roger “I’ve never worked a hard day in my life” Goodell, the man born with a silver spoon up his butt, I was not surprised. He’s the most politically correct P.O.S. NFL commissioner ever selected and in typical lawyer fashion has expanded the sissification and wussification of what was once a great game.  All that is happening to our beloved game under this joke and the prior commish is that QB’s like New England’s Oprah Brady squeal and lift up their skirts to the refs when a defensive player farts on them and they get the personal foul flag thanks to these new absurd rules. Don’t let your mascara run little girl, it might make you use a time out to touch it up.

Thus I wish you the best of luck. Thankfully football is still alive and well at the college and high school levels for now but soon the race baiting sissifying politically correct socialist anti-American scumbags will have their way with the game there also. I’m sure we’ll see something like flag football or guys being forced to wear long flowing skirts to equal everything out if the ACLU types ever get their way. Regardless, you need to try to fight the good fight Rush, at least until you finally “Go Galt” and take that trip to New Zealand you have snickered about on the air. And if you do take that trip, I have a suggestion to stick it in the eye of these clowns one more time:

Buy the national Rugby team down there, The All Blacks.

Sincerely,

John

By John Galt

October 14, 2009

Did ya hear the good news?

Retail sales were much better than anticipated. Of course the fact that the prior month was revised downward by 0.5% was missed by most as the MariaBartiromogasms over Dow 10,000 blotted out anything that almost anyone had to say about oh, uh, reality, ya, you know, what is really going on. Thus I present the raw data from the past month’s  report so exalted by the almighty Bubblemedia this morning:

Needless comments at this point time from those who proclaim that we’re in recovery are not necessary for this entry. If you start reading the raw data instead of the politically adjusted (aka “seasonally adjusted”) you begin to notice a trend:  This economy is still in the crapper.

When you combine the retail sales data with the rail traffic reports from the latest reporting week (Oct 3, Railfax):

it really isn’t rocket science to figure out that our statistical recovery is not even close to what the media makes it out to be. The numbers might impress but the pain is being felt across almost every industry and there are few signs of any real expansion or economic growth on Main Street. On the good news side of things, at least we don’t have to listen to those evil bears on Bubblevisions One, Two, or Three. After all, the bears never said this would happen the way it did.

Or did they?

Back in 1999…….

by John Galt

October 14, 2009

CSX shares rise on hopes that recession is over

(AP-October 14)

CSX posts lower profit, offers upbeat take on future

(MarketWatch-October 13)

Ward: CSX will rebound with economy

(BizJournals-October 14)

CSX Says Recession Over; Stock Surges

(TheStreet.com-October 14)

CSX Beats Wall Street Expectations; Shares Rise

(CNBC.com-October 13)

Just a sample of the headlines and how the Bubblemedia and MSM are all dying to insure that they find the remaining suckers and bleed them dry. The “hopes” that the recession is over is masked by a very bloody, blatant fact proclaimed in CSX’s own earning statement (From Pg. 10 of the Q3 8K available via Edgar through the WSJ):

If you notice the highlighted boxes and arrows what is this telling anyone with one iota of COMMON SENSE?

That’s right, the Christmas season is going to be HORRID and the retail sector is about to experience another step downwards as they are not ordering any inventory and the auto sector is realistically still D.O.A. despite the Con for Clunkers program. What you see in the report above is a dramatic drop in volume for coal because power companies inside the U.S. do not need as much coal when the associated industrial sectors are running so far under capacity that they really have no need for electricity. Not to mention that empty homes have a tendency to not consume that much power either, I’m just sayin’.

This quarter’s report for the transport and rail sectors is the tell tale for the future and it is bleak for the commercial and retail sectors moving forward. The retailers are not building inventory for Christmas (further confirmed by the port statistics nationwide) and unless the current administration can convince CONgress to pass a “Gift Card for All” program in the next 30 days, we will see another wave of bankruptcies and CRE issues arising from this disaster.

Ho-Ho-Hum.