Thursday, October 22, 2009

November Monetary Trends…

This is the first issue in quite some time that has been updated in its entirety to the same date, in this case all the charts are current through 10/20/09.

Most of the old trends, that I have pointed out many times, are still in place. An exception would be the money supply charts that are expressed in “percent change at an annual RATE.” Those have been trending downwards, but have reversed and are moving upwards again, at least for now. These “annual rate” charts are more sensitive to turns as they multiply short term moves into annualized rates:

The year over year trends, however are that the money supply growth rates are still slowing. Not negative, but slowing:

None of that money has a chance if velocity remains in the gutter, and it is. For inflation to really pick up, velocity needs to improve. How can it with the populace still debt saturated and incomes depressed? When money comes in, it must pay over inflated mortgages, over inflated rents, and usurious rates on maxed out credit cards. When and how does that change? Does printing money and giving it to the banks change that? Of course not, only a FOOL or a ROBBER would believe or tell you otherwise:

Consumer credit, total bank credit, and loans and leases are all deeply in negative territory with well established trends downwards that have not changed as I also showed in yesterday’s Fed Chart Update:

And to all those who talk about the “modern” trumped up “operating” earnings, please remember that history is not kind to those who try to spin black into white. This Price to Earnings chart is the real deal, the one that compares apples to apples, and even it is artificially low as mark-to-fantasy cannot be reverse accounted out of the system entirely, thus earnings are overstated compared to real world prices and to real world cash flows.

The “law” that always wins is the law of math… immutable as the law of gravity or the laws of physics.

The Clash – I Fought the Law: