How Much Government Spending Is Costing You Per Day

Tuesday, May 24, 2011
By Paul Martin

by Bill Bonner
LewRockwell.com

Look at what happened on Friday. The Dow dropped 93 points. Oil stayed below $100. But gold added $16 to close well above $1,500.

Fluke? Or trend?

Hey, you’re asking the wrong person. What do we know? No one knows.

But what we do know is that the Great Correction is continuing to do its work. All the recent reports tell us that the economy is weak…and weakening. Housing starts, manufacturing output, consumer confidence – all are pointing to a long, hot, sultry, sluggish summer.

So far, the big sell-off has not even begun. But it could start any day. Maybe Friday’s numbers reflected the new trend. Maybe not.

But just so we get to say ‘I told you so’ here is what we expect:

Stocks will be weak…maybe a big sell-off in the summer months. Investors will begin to realize that the economy is not as healthy as they thought. And the effects of QE2 will wear off.
The Great Correction, combined with the feds’ battle against it, will continue. Economic reports will be mixed and confusing as a result. But no clear, real recovery will begin.
The Fed will announce new measures – QE3. These could come anytime, but will most likely follow a new crisis. For example, a default by Greece…or a sharp break in the stock market.
Analysts say the punky figures are not confined to the US. The entire world is slowing down. Emerging markets are being forced to try to control inflation. Europe is worried about what happens when Greece defaults – which is coming soon. And the US is suffering from the worst housing slump in its history. Prices are already down 33%…more than one out of four homeowners is already underwater…and prices are falling at the rate of about 1% per month.

The Rest…HERE

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