Proof of U.S. 'Greater Depression': Opinion
By Jeff Nielson - 02/23/12 - 8:02 AM ESTThe following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage. NEW YORK (Bullion Bulls Canada) -- It has become increasingly difficult to engage in credible economic analysis, especially with respect to the U.S. economy. The problem: ever more limited sources of uncorrupted data, while the farcical "official statistics" have long since been totally divorced from the real world. Fortunately we have been presented with some raw, uncorrupted data that demonstrates in conclusive terms that the U.S. economy is literally shriveling before our eyes: a 21st century economy with plummeting energy consumption, and even a declining use of electricity.
...American companies also bought more consumer household items, automobiles and parts, and crude oil from overseas. Exports increased 0.7% to $178.8 billion, boosted by record sales of petroleum to buyers overseas. That caused the trade gap excluding petroleum to widen even more than the deficit overall...The great U.S. economy, the largest oil-glutton in the history of humanity (by several multiples) is now a "net energy exporter". How can this be possible? The U.S. economy has contracted so severely (already) that the only way that U.S. refineries can sell all the petroleum products they produce is to sell them to the growing economies of "emerging market" nations. Reflecting the broad-based collapse of the U.S. economy, these refineries are now exporting all categories of petroleum products: diesel, jet fuel, and even gasoline are now being exported in large quantities, month-after-month by U.S. refineries. Recall that it was only four, short years ago that many American politicians were alarmed by the crisis of the "lack of U.S. refining capacity." No new refineries have been constructed in the U.S. in more than 30 years, and at that time those refineries were straining to meet the demand of solely the U.S. domestic market. With that domestic market collapsing, these refineries are now straining to find enough foreign buyers to unload all of their inventories.
No Market at HomeGiven these facts alone, it is utterly absurd for the U.S. government to pretend that the U.S. economy is growing. Note that the government claims that most of this growth is occurring in agriculture and manufacturing -- both very energy-intensive industries. There's no doubt that the energy-intensive agriculture sector is thriving, a result of a growing global "appetite" and Wall Street-induced shortages in most commodities. So with the large U.S. agriculture sector gobbling up more energy than ever, what does that say about the rest of the (decaying) U.S. economy?
Economy on Life SupportWe must also never forget that all of this decline in energy and electricity consumption comes after the largest/most reckless fiscal stimulus as well. The U.S., with by far the world's largest national deficit (even using the absurd, official number), has not yet begun the fiscal tightening being attempted in most other Western nations (with the notable exception of Canada). What happens when this dying economy actually turns off the taps with all of this "easy money" from the government (which the U.S. government obviously cannot afford)? Already we see indications of electricity consumption falling off again. If the most insane/extreme fiscal and monetary stimulus in the history of the global economy has produced nothing but further economic decay, what happens when this unsustainable stimulus ceases to be sustained? The obvious answer to that question is a Soviet Union-like economic implosion, assuming that reckless money-printing doesn't produce the nightmare of hyperinflation first.
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