Precisely. I particularly like the analogy "The map is not the land. The statistics are not the economy." Better than I would have thought up, but pretty much exactly the same idea I posted just a day ago.
Contrary to the belief of mainstream economists, economics is not a giant confidence game in which the government can fool enough people into feeling sufficient consumer confidence to generate a self-fulfilling prophecy of economic growth. Even as the composite leading indicators and GDP numbers turn positive, real measures of economic activity are pointing in precisely the opposite direction. International shipping has begun to slump again. After a three-month rise spurred by an aggressive stimulus program, steel prices have begun to fall once more in the world's largest steel-using country, China. Nearly 40 percent of the stocks traded on the New York Stock Exchange are the worthless stocks of four zombiebeing propped up by the federal government, BAC, C, FNM and FRE. Total U.S. loans and leases are down 4.6 percent for the year, an initial sign that the inevitable deleveraging process has begun. The percentage of failed bank deposits in 2009 are rapidly approaching three times the percentage of failedin 1931, and the FDIC has been forced to request a $500 billion credit line from the U.S. Treasury to stave off looming bankruptcy.
The map is not the land. The statistics are not the economy. This is not a recovery; this is the false dawn that precedes the darkness.
Monday, September 14, 2009
Vox: It Ain't Over Yet...
Vox Day gives a brief and excellent explanation about why we shouldn't believe the talk of recovery: