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The “Independent” Mainstream Media Does It Again | Zero Hedge

The “Independent” Mainstream Media Does It Again | Zero Hedge.

A month ago, none other than Conan O’Brien exposed the un-independent PR-sponsored propaganda-fest that is the local news mainstream media in America. Well, it’s happened again… this time proclaiming “Don’t worry… be Happy.”

 

As Liberty Blitzkrieg’s Mike Krieger reminds, we all know the mainstream media is a joke but sometimes its inherent idiocy can be best highlighted with a little humor…

 

 

Of course this was all prophesied many years ago:

Under a dictatorship the Big Business, made possible by advancing technology and the consequent ruin of Little Business, is controlled by the State – that is to say, by a small group of party leaders and the soldiers, policemen and civil servants who carry out their orders. In a capitalist democracy such as the United States, it is controlled by what Professor C. Wright Mills has called the Power Elite.

 

This Power Elite directly employs several millions of the country’s working force in its factories, offices and stores, controls many millions more by lending them the money to but its products, and, through its ownership of the media of mass communications, influences the thoughts, the feelings and the actions of virtually everybody.

– Aldous Huxley, Brave New World Revisited 1958

Brave New World Revisited…Key Excerpts and My Summary | A Lightning War for Liberty

Brave New World Revisited…Key Excerpts and My Summary | A Lightning War for Liberty.

Under the relentless thrust of accelerating over-population and increasing over-organization, and by means of ever more effective methods of mind-manipulation, the democracies will change their nature; the quaint old formselections, parliaments, Supreme Courts and all the restwill remain. The underlying substance will be a new kind of non-violent totalitarianism. All the traditional names, all the hallowed slogans will remain exactly what they were in the good old days. Democracy and freedom will be the theme of every broadcast and editorialbut Democracy and freedom in a strictly Pickwickian sense. Meanwhile the ruling oligarchy and its highly trained elite of soldiers, policemen, thought-manufacturers and mind-manipulators will quietly run the show as they see fit. 

– Aldous Huxley, Brave New World Revisited, published 1958

It’s always felt a bit bizarre and, indeed slightly embarrassing, that of all the books I have read in my days, Aldous Huxley’s 1932 classic Brave New World was not amongst them. Not only is the book frequently mentioned to make political and social statements about contemporary times, the novel’s concept always caught my interest. I just never got around reading it. Until late last year.

I loved this book and was very pleasantly surprised. I was prepared for a more fearful and overwhelmingly dark and twisted experience. While there were obvious elements of that, it was a much more enjoyable read than I anticipated. Indeed, it was a very human book, as ironic as that might sound. As much as the “Controllers” in Brave New World were indeed in control, the human spirit still managed to bubble to the surface. To the point that the controllers had to designate certain islands for the iconoclasts which inevitably emerged from within the “Alpha” class. All of the drugs, brainwashing and conditioning couldn’t totally break the human spirit. As such, it was a much more hopeful and nuanced novel than I expected it to be. If you haven’t read it, I suggest making it your next book. If you have read it, read it again.

However, this post isn’t about Brave New World. While that book is indeed a creative warning, it is still fiction and a work of art more than anything else. Twenty six years after its publication, Huxley wrote Brave New World Revisited, in which he takes stock of the post World War II period. His analysis is grave. He saw the world progressing toward his nightmare much faster than he anticipated. Brave New World Revisited is a brilliant work of non-fiction and filled with almost incomprehensibly prescient musings. It also provides a great deal of advice to future generations. Advice which we must immediately heed.

Of all the solutions Huxley focuses on in Brave New World Revisited, from proper education, to a simple acknowledgment of humanity as a moderately gregarious animal not prone to over-organization; the most profound, and I think useful recommendation, is for us to decentralize. This has been a theme of mine and many other writers for some time now. Fortunately, through things like 3D-Printing, Bitcoin and other decentralized crypto-currencies, open source software, crowd funding, social media, etc, the world is moving from centralization to radical decentralization. People will be more connected than ever, but power will be more decentralized. We need to continue to push rapidly in this direction and a whole new incredible world will emerge. Indeed, it is being born as I write this.

Several years ago after reading Hayek’s Road to Serfdom I wrote a lengthy post highlighting key excerpts for those who were interested, but didn’t have the time or inclination to read the whole thing. Due to that post’s popularity and effectiveness, I have attempted to do the same with Brave New World Revisited. I hope this inspires you all to read the entire thing. Enjoy.

From Chapter 2: Quantity, Quality, Morality

And now let us consider the case of the rich, industrialized and democratic society, in which, owing to the random but effective practice of dysgenics, IQ’s and physical vigor are on the decline. For how long can such a society maintain its traditions of individual liberty and democratic government? Fifty or a hundred years from now our children will learn the answer to this question.

My Thoughts: Yes, indeed we are learning the answer to this right now. Just look around you.

From Chapter 3: Over-Organization

Under a dictatorship the Big Business, made possible by advancing technology and the consequent ruin of Little Business, is controlled by the State-that is to say, by a small group of party leaders and the soldiers, policemen and civil servants who carry out their orders. In a capitalist democracy such as the United States, it is controlled by what Professor C. Wright Mills has called the Power Elite. This Power Elite directly employs several millions of the country’s working force in its factories, offices and stores, controls many millions more by lending them the money to but its products, and, through its ownership of the media of mass communications, influences the thoughts, the feelings and the actions of virtually everybody.

My Thoughts: If you talk as Huxley writes above in “polite society” you will be labeled a conspiracy theorist or kook.

From Chapter 3: Over-Organization

It is in the social sphere, in the realm of politics and economics, that the Will to Order becomes really dangerous. Here the theoretical reduction of unmanageable multiplicity to comprehensible unity becomes the practical reduction of human diversity to subhuman uniformity, of freedom to servitude. In politics the equivalent of a fully developed scientific theory or philosophical system is a totalitarian dictatorship. In economics, the equivalent of a beautifully composed work of art is the smoothly running factory in which the workers are perfectly adjusted to the machines. The Will to Order can make tyrants out of those who merely aspire to clear up a mess. The beauty of tidiness is used as a justification for despotism.

Organization is indispensable; for liberty arises and has meaning only within a self-regulating community of freely cooperating individuals. But, though indispensable, organization can also be fatal. Too much organization transforms men and women into automata, suffocates the creative spirit and abolishes the very possibility of freedom. As usual, the only safe course is in the middle, between the extremes of laissez-faire at the one end of the scale and of total control at the other.

My Thoughts: Huxley accurately notes that the “will to order” is a natural part of the human psyche. There are disciplines where the “will to order” is actually useful and necessary to human progress; however, he warns that in the social sphere it is deadly and usually ends with totalitarianism.

From Chapter 3: Over-Organization

City life is anonymous and, as it were, abstract. People are related to one another, not as total personalities, but as the embodiment of economic functions or, when they are not at work, as irresponsible seekers of entertainment. Subjected to this kind of life, individuals tend to feel lonely and insignificant. Their existence ceases to have any point or meaning.

My Thoughts: Huxley clearly sees the sprawling metropolis as incongruent with human nature and freedom. It is a theme he consistently returns to throughout the book.

From Chapter 3: Over-Organization

Biologically speaking, man is a moderately gregarious, not a completely social animal—a creature more like a wolf, let us say, or an elephant, than like a bee or an ant. In their original form human societies bore no resemblance to the hive or the ant heap; they were merely packs. Civilization is, among other things, the process by which primitive packs are transformed into an analogue, crude and mechanical, of the social insects’ organic communities. At the present time the pressures of over-population and technological change are accelerating this process. The termitary has come to seem a realizable and even, in some eyes, a desirable ideal. Needless to say, the ideal will never in fact be realized. A great gulf separates the social insect from the not too gregarious, big-brained mammal; and even though the mammal should do his best to imitate the insect, the gulf would remain. However hard they try, men cannot create a social organism, they can only create an organization. In the process of trying to create an organism they will merely create a totalitarian despotism.

My Thoughts: A simply brilliant and incredibly important warning.

From Chapter 3: Over-Organization

The impersonal forces of overpopulation and over-oragnization, and the social engineers who are trying to direct these forces, are pushing us in the direction of a new medieval system. This revival will be made more acceptable than the original by such Brave-New—Worldian amenities as infant conditioning, sleep-teachings and drug-induced euphoria; but, for the majority of men and women, it will still be a kind of servitude.

My Thoughts: Yep, he predicted our current neo-feudalistic state in 1958.

From Chapter 4: Propaganda in a Democratic Society

Given a fair chance, human beings can govern themselves, and govern themselves better, though perhaps with less mechanical efficiency, than they can be governed by “authorities independent of their will.” Given a fair chance, I repeat; for the fair chance is an indispensable prerequisite. No people that passes abruptly from a state of subservience under the rule of a despot to the completely unfamiliar state of political independence can be said to have a fair chance of making democratic institutions work.

My Thoughts: Would’ve been nice if we thought about that before we invaded Iraq (of course, the problem is our goal was never to bring Democracy to Iraq in the first place).

From Chapter 4: Propaganda in a Democratic Society

In regard to propaganda the early advocates of universal literacy and a free press envisaged only two possibilities: the propaganda might be true, or it might be false.They did not foresee what in fact has happened, above all in our Western capitalist democraciesthe development of a vast mass communications industry concerned in the main neither with the true nor the false, but with the unreal, the more or less totally irrelevant. In a word, they failed to take into account man’s almost infinite appetite for distractions.

For conditions even remotely comparable to those now prevailing we must return to imperial Rome, where the populace was kept in good humor by frequent, gratuitous doses of many kinds of entertainmentfrom poetical dramas to gladiatorial fights, from recitations of Virgil to all-out boxing, from concepts to military reviews and public executions. But even in Rome there was nothing like the non-stop distractions now provided by newspapers and magazines, by radio television and the cinema.

My Thoughts: This brings me to a short story I’d like to share. I was on a plane as I read this and I put down my book for a second to look around me. I had an aisle seat, and so was at a good vantage point from which to take stock of the plane. I was actually stunned to notice that there was not a single other person reading a book anywhere around me. I actually enjoy the lack of Wifi on flights as it forces me to engage in some old school book reading. To my surprise no one else seemed to see it that way. Horrifyingly, the only people that weren’t dozing off or watching television were still on their smart phones. Even worse, at least five of them seemed to be playing the same game! It looked like some sort of Tetris game with jewels. So despite the lack of Wifi, humanity’s ability for mindless entertainment and distraction prevailed. Wifi or no Wifi, these folks were going to be on their “smart”phones one way or the other.

From Chapter 5: Propaganda Under a Dictatorship

Assembled in a crowd, people lose their powers of reasoning and their capacity for moral choice. Their suggestibility is increased to the point where they cease to have any judgement or will of their own. They become very excitable, they lose all sense of individual or collective responsibility, they are subject to sudden accesses of rage, enthusiasm and panic. In a word, man in a crowd behaves as though he had swallowed a large dose of what I have called “herd-poisoning.”

Reading is a private, not a collective activity. The writer speaks only to individuals, sitting by themselves in a state of normal sobriety. The orator speaks to masses of individuals, already well primed with herd poison. They are at his mercy and, if he knows his business, he can do what he likes with them.

My Thoughts: This is something to always be aware of. Oration to crowds is the most effective form of propaganda distribution and brainwashing.

From Chapter 5: Propaganda Under a Dictatorship

In Hitler’s words, the propagandist should adopt “a systematically one-sided attitude towards every problem that has to be dealt with.” He must never admit that he might be wrong or that people with a different point of view might be even partially right. Opponents should not be argued with; they should be attacked, shouted down, or, if they become too much of a nuisance, liquidated. The morally squeamish intellectual may be shocked by this kind of thing. But the masses are always convinced that “right in on the side of the active aggressor.”

My Thoughts: This is why Obama just lies non-stop with zero shame. His strategy is to just stick to the propaganda and go with it at all costs, no matter how irrational and obviously deceptive.

From Chapter 6: The Arts of Selling

People may start out with an initial prejudice against tyrants; but when tyrants or would-be tyrants treat them to adrenalinreleasing propaganda about the wickedness of their enemies- particularly of enemies weak enough to be persecuted-they are ready to follow him with enthusiasm.

Almost all of us long for peace and freedom; but very few of us have much enthusiasm for the thoughts, feelings and actions that make for peace and freedom. Conversely almost nobody wants war or try nanny; but a great many people find an intense pleasure in the thoughts, feelings and actions that make for war and tyranny.

My Thoughts: That’s probably the scariest and most depressing thing I read.

Chapter 6: The Arts of Selling

“Both parties,” we were told in 1956 by the editor of a leading business journal, “will merchandize their candidates and issues by the same methods that business had developed to sell goods. These include scientific selection of appeals and planned repetition…The political merchandisers appeal only to the weakness of voters, never to their potential strength. They make no attempt to educate the masses into becoming fit for self-government, they are content merely to manipulate and exploit them.

In one way or another, as vigorous he-man or kindly father, the candidate must be glamorous. He must also be an entertainer who never bores his audience. Inured to television and radio, that audience is accustomed to being distracted and does not like to be asked to concentrate or make a prolonged intellectual effort. All speeches by the entertainer-candidate must therefor be short and snappy. The great issues of the day must be dealt with in five minutes at the most-and preferably (since the audience will be eager to pass on to something a little livelier than inflation or the H-bomb) in sixty seconds flat. The nature of oratory is such that there has always been a tendency among politicians and clergymen to over-simplify complex issues. From a pulpit or a platform even the most conscientious of speakers finds it very difficult to tell the whole truth. The methods now being used to merchandise the political candidate as though he were a deodorant positively guarantee the electorate against ever hearing the truth about anything.

My Thoughts: It’s simply incredible how clearly he saw all of this more than fifty years ago.

From Chapter 7: Brainwashing

The effectiveness of political and religious propaganda depends upon the methods employed, not upon the doctrines taught. These doctrines may be true or false, wholesome or perniciousit makes little or no difference. If the indoctrination is given in the right way at the proper stage of nervous exhaustion, it will work. Under favorable conditions, practically everybody can be converted to practically anything.

From Chapter 8: Chemical Persuasion

That a dictator could, if he so desired, make use os these drugs for political purposes is obvious. He could ensure himself against political unrest by changing the chemistry of his subjects’ brains and so making them content with their servile condition…But how, it may be asked, will the dictator get his subjects to take the pills that will make them think, feel and behave in the ways he finds desirable? In all probability it will be enough merely to make the pill available…But the demand of the American public for something that will make life in an urban-industrial environment a little more tolerable is so great that doctors are now writing prescriptions for the various tranquilizers at the rate of forty-eight millions a year.

My Thoughts: Yep, it is definitely a huge problem that such a huge percentage of the population is drugged up pretty much 24/7.

From Chapter 8: Chemical Persuasion

Too much tension is a disease; but so is too little. There are certain occasions when we ought to be tense, when an excess of tranquillity (and especially of tranquility imposed from the outside, by a chemical) is entirely inappropriate.

My Thoughts: This is very similar to what Martin Luther King wrote in his “Letter from Birmingham Jail,” in which he states:

“Actually, we who engage in nonviolent direct action are not the creators of tension. We merely bring to the surface the hidden tension that is already alive. We bring it out in the open, where it can be seen and dealt with. Like a boil that can never be cured so long as it is covered up but must be opened with all its ugliness to the natural medicines of air and light, injustice must be exposed, with all the tension its exposure creates, to the light of human conscience and the air of national opinion before it can be cured.”

From Chapter 9: Subconscious Persuasion

In the light of what has been said about persuasion-by-assocation and the enhancement of emotions by subliminal suggestion, let us try to imagine what the political meeting of tomorrow will be like. The candidate (if there is still a question of candidates), or the appointed representative of the ruling oligarchy, will make his speech for all to hear. Meanwhile the tachistoscopes, the whispering and squeaking machines, the projectors of images so dim that only the subconscious mind can respond to them, will be reinforcing what he says by systematically associating the man and his cause with positively charged words and hallowed images, and by strobonically injecting negatively charged words and odious symbols whenever he mentions the enemies of the State or the Party…Because all of this is still safely in the future, we can afford to smile. Ten or twenty years from now, it will probably seem a good deal less amusing. For what is now merely science fiction will have become everyday political fact.

My Thoughts: We are living it and there’s certainly nothing amusing about it.

From Chapter 10: Hypnopaedia

A person in deep sleep is unsuggestible. But when the subjects in light sleep are given suggestions, they will respond to them. Mr. Barber found, the the same way that they respond to suggestions when in the hypnotic trance.

From the heightened suggestibility associated with light sleep and hypnosis let us pass to the normal suggestibility of those who are awakeor at least who think they are awake. (In fact, as the Buddhists insist, most of us are half asleep all the time and go through life as somnambulists obeying somebody else’s suggestions. Enlightenment is total awakens. The word “Buddha” can be translated as “The Wake.”)

From Chapter 11: Education for Freedom

Freedom is therefore a great good, tolerance a great virtue and regimentation a great misfortune.

The genetic standardization of individuals is still impossible; but Big Government and Big Business already posses, or will very soon possess, all the techniques for mind-manipulation described in Brave New World, along with others of which I was too unimaginative to dream. Lacking the ability to impose genetic uniformity upon embryos, the rulers of tomorrow’s over-populated and over-organized world will try to impose social and cultural uniformity upon adults and their children. To achieve this end, the will (unless prevented) make use of all the mind-manipualting techniques at their disposal and will not hesitate to reinforce these methods of non-rational persuasion by economic coercion and threats of physical violence. If this kind of tyranny is to be avoided, we must begin without delay to educate ourselves and of children for freedom and self-government.

From Chapter 11: Education for Freedom

But unfortunately correct knowledge and sound principles are not enough. An unexciting truth may be eclipsed by a thrilling falsehood. A skillful appeal to passion is often too strong for the best of good resolutions. The effects of false and pernicious propaganda cannot be neutralized except by a thorough training in the art of analyzing its techniques and seeing through its sophistries.

In cases where the selecting and abstracting have been dictated by a system that is not too erroneous as a view of the nature of things, and where the verbal labels have been intelligently chosen and their symbolic nature clearly understood, our behavior is apt to be realistic and tolerably decent. But under the influence of badly chosen words, applied, without any understanding of their merely symbolic character, to experiences that have been selected and abstracted in the light of a system of erroneous ideas, we are apt to behave with a fiendishness and an organized stupidity, of which dumb animals (precisely because they are dumb and cannot speak) are blessedly incapable.

My Thoughts: Essentially, the reason humanity is able to create such gigantic instances of suffering relates to our higher intelligence combined with our ability to be easily brainwashed and manipulated by the nastiest of humans on the bell curve. 

From Chapter 12: What Can Be Done?

Under the relentless thrust of accelerating over-population and increasing over-organization, and by means of ever more effective methods of mind-manipulation, the democracies will change their nature; the quaint old formselections, parliaments, Supreme Courts and all the restwill remain. The underlying substance will be a new kind of non-violent totalitarianism. All the traditional names, all the hallowed slogans will remain exactly what they were in the good old days. Democracy and freedom will be the theme of every broadcast and editorialbut Democracy and freedom in a strictly Pickwickian sense. Meanwhile the ruling oligarchy and its highly trained elite of soldiers, policemen, thought-manufacturers and mind-manipulators will quietly run the show as they see fit.

Or take the right to vote. In principle, it is a great privilege. In practice, as recent history has repeatedly shown, the right to vote, by itself, is no guarantee of liberty.Therefore, if you wish to avoid dictatorship by referendum, break up modern society’s merely functional collectives into self-governing, voluntarily co-operating groups, capable of functioning outside the bureaucratic systems of Big Business and Big Government.

Over-population and over-organization have produced the modern metropolis, in which a fully human life of multiple personal relationships has become almost impossible. Therefore, if you wish to avoid the spiritual impoverishment of individuals and whole societies, leave the metropolis and revive the small country community, or alternatively humanize the metropolis by creating within its network of mechanical organization the urban equivalents of small country communities, in which individuals can meet and cooperate as complete persons, not as the mere embodiments of specialized functions.

My Thoughts: His ultimate conclusion, and one with which I agree, is that we need to decentralize to remain free.

The older dictators fell because they could never supply their subjects with enough bread, enough circuses, enough miracles and mysteries.

If you still haven’t had enough Huxley, I strongly suggest watching the following video. I hope you found this helpful, and as always…

In Liberty,
Michael Krieger

 

THE RETAIL DEATH RATTLE « The Burning Platform

THE RETAIL DEATH RATTLE « The Burning Platform.

“I was part of that strange race of people aptly described as spending their lives doing things they detest, to make money they don’t want, to buy things they don’t need, to impress people they don’t like.” ― Emile Gauvreau

 

 

If ever a chart provided unequivocal proof the economic recovery storyline is a fraud, the one below is the smoking gun. November and December retail sales account for 20% to 40% of annual retail sales for most retailers. The number of visits to retail stores has plummeted by 50% since 2010. Please note this was during a supposed economic recovery. Also note consumer spending accounts for 70% of GDP. Also note credit card debt outstanding is 7% lower than its level in 2010 and 16% below its peak in 2008. Retailers like J.C. Penney, Best Buy, Sears, Radio Shack and Barnes & Noble continue to report appalling sales and profit results, along with listings of store closings. Even the heavyweights like Wal-Mart and Target continue to report negative comp store sales. How can the government and mainstream media be reporting an economic recovery when the industry that accounts for 70% of GDP is in free fall? The answer is that 99% of America has not had an economic recovery. Only Bernanke’s 1% owner class have benefited from his QE/ZIRP induced stock market levitation.

 

 

The entire economic recovery storyline is a sham built upon easy money funneled by the Fed to the Too Big To Trust Wall Street banks so they can use their HFT supercomputers to drive the stock market higher, buy up the millions of homes they foreclosed upon to artificially drive up home prices, and generate profits through rigging commodity, currency, and bond markets, while reducing loan loss reserves because they are free to value their toxic assets at anything they please – compliments of the spineless nerds at the FASB. GDP has been artificially propped up by the Federal government through the magic of EBT cards, SSDI for the depressed and downtrodden, never ending extensions of unemployment benefits, billions in student loans to University of Phoenix prodigies, and subprime auto loans to deadbeats from the Government Motors financing arm – Ally Financial (85% owned by you the taxpayer). The country is being kept afloat on an ocean of debt and delusional belief in the power of central bankers to steer this ship through a sea of icebergs just below the surface.

 

The absolute collapse in retail visitor counts is the warning siren that this country is about to collide with the reality Americans have run out of time, money, jobs, and illusions. The most amazingly delusional aspect to the chart above is retailers continued to add 44 million square feet in 2013 to the almost 15 billion existing square feet of retail space in the U.S. That is approximately 47 square feet of retail space for every person in America. Retail CEOs are not the brightest bulbs in the sale bin, as exhibited by the CEO of Target and his gross malfeasance in protecting his customers’ personal financial information. Of course, the 44 million square feet added in 2013 is down 85% from the annual increases from 2000 through 2008. The exponential growth model, built upon a never ending flow of consumer credit and an endless supply of cheap fuel, has reached its limit of growth. The titans of Wall Street and their puppets in Washington D.C. have wrung every drop of faux wealth from the dying middle class. There are nothing left but withering carcasses and bleached bones.

 

The impact of this retail death spiral will be vast and far reaching. A few factoids will help you understand the coming calamity:

  • There are approximately 109,500 shopping centers in the United States ranging in size from the small convenience centers to the large super-regional malls.
  • There are in excess of 1 million retail establishments in the United States occupying 15 billion square feet of space and generating over $4.4 trillion of annual sales. This includes 8,700 department stores, 160,000 clothing & accessory stores, and 8,600 game stores.
  • U.S. shopping-center retail sales total more than $2.26 trillion, accounting for over half of all retail sales.
  • The U.S. shopping-center industry directly employed over 12 million people in 2010 and indirectly generated another 5.6 million jobs in support industries. Collectively, the industry accounted for 12.7% of total U.S. employment.
  • Total retail employment in 2012 totaled 14.9 million, lower than the 15.1 million employed in 2002.
  • For every 100 individuals directly employed at a U.S. regional shopping center, an additional 20 to 30 jobs are supported in the community due to multiplier effects.

 

The collapse in foot traffic to the 109,500 shopping centers that crisscross our suburban sprawl paradise of plenty is irreversible. No amount of marketing propaganda, 50% off sales, or hot new iGadgets is going to spur a dramatic turnaround. Quarter after quarter there will be more announcements of store closings. Macys just announced the closing of 5 stores and firing of 2,500 retail workers. JC Penney just announced the closing of 33 stores and firing of 2,000 retail workers. Announcements are imminent from Sears, Radio Shack and a slew of other retailers who are beginning to see the writing on the wall. The vacancy rate will be rising in strip malls, power malls and regional malls, with the largest growing sector being ghost malls. Before long it will appear that SPACE AVAILABLE is the fastest growing retailer in America.

 

The reason this death spiral cannot be reversed is simply a matter of arithmetic and demographics. While arrogant hubristic retail CEOs of public big box mega-retailers added 2.7 billion retail square feet to our already over saturated market, real median household income flat lined. The advancement in retail spending was attributable solely to the $1.1 trillion increase (68%) in consumer debt and the trillion dollars of home equity extracted from castles in the sky, that later crashed down to earth. Once the Wall Street created fraud collapsed and the waves of delusion subsided, retailers have been revealed to be swimming naked. Their relentless expansion, based on exponential growth, cannibalized itself, new store construction ground to a halt, sales and profits have declined, and the inevitable closing of thousands of stores has begun. With real median household income 8% lower than it was in 2008, the collapse in retail traffic is a rational reaction by the impoverished 99%. Americans are using their credit cards to pay their real estate taxes, income taxes, and monthly utilities, since their income is lower, and their living expenses rise relentlessly, thanks to Bernanke and his Fed created inflation.

The media mouthpieces for the establishment gloss over the fact average gasoline prices in 2013 were the second highest in history. The highest average price was in 2012 and the 3rd highest average price was in 2011. These prices are 150% higher than prices in the early 2000′s. This might not matter to the likes of Jamie Dimon and Jon Corzine, but for a middle class family with two parents working and making 7.5% less than they made in 2000, it has a dramatic impact on discretionary income. The fact oil prices have risen from $25 per barrel in 2003 to $100 per barrel today has not only impacted gas prices, but utility costs, food costs, and the price of any product that needs to be transported to your local Wally World. The outrageous rise in tuition prices has been aided and abetted by the Federal government and their doling out of loans so diploma mills like the University of Phoenix can bilk clueless dupes into thinking they are on their way to an exciting new career, while leaving them jobless in their parents’ basement with a loan payment for life.

 

The laughable jobs recovery touted by Obama, his sycophantic minions, paid off economist shills, and the discredited corporate legacy media can be viewed appropriately in the following two charts, that reveal the false storyline being peddled to the techno-narcissistic iGadget distracted masses. There are 247 million working age Americans between the ages of 18 and 64. Only 145 million of these people are employed. Of these employed, 19 million are working part-time and 9 million are self- employed. Another 20 million are employed by the government, producing nothing and being sustained by the few remaining producers with their tax dollars. The labor participation rate is the lowest it has been since women entered the workforce in large numbers during the 1980′s. We are back to levels seen during the booming Carter years. Those peddling the drivel about retiring Baby Boomers causing the decline in the labor participation rate are either math challenged or willfully ignorant because they are being paid to be so. Once you turn 65 you are no longer counted in the work force. The percentage of those over 55 in the workforce has risen dramatically to an all-time high, as the Me Generation never saved for retirement or saw their retirement savings obliterated in the Wall Street created 2008 financial implosion.

 

To understand the absolute idiocy of retail CEOs across the land one must parse the employment data back to 2000. In the year 2000 the working age population of the U.S. was 213 million and 136.9 million of them were working, a record level of 64.4% of the population. There were 70 million working age Americans not in the labor force. Fourteen years later the number of working age Americans is 247 million and only 144.6 million are working. The working age population has risen by 16% and the number of employed has risen by only 5.6%. That’s quite a success story. Of course, even though median household income is 7.5% lower than it was in 2000, the government expects you to believe that 22 million Americans voluntarily left the labor force because they no longer needed a job. While the number of employed grew by 5.6% over fourteen years, the number of people who left the workforce grew by 31.1%. Over this same time frame the mega-retailers that dominate the landscape added almost 3 billion square feet of selling space, a 25% increase. A critical thinking individual might wonder how this could possibly end well for the retail genius CEOs in glistening corporate office towers from coast to coast.

 

This entire materialistic orgy of consumerism has been sustained solely with debt peddled by the Wall Street banking syndicate. The average American consumer met their Waterloo in 2008. Bernanke’s mission was to save bankers, billionaires and politicians. It was not to save the working middle class. You’ve been sacrificed at the altar of the .1%. The 0% interest rates were for Jamie Dimon and Lloyd Blankfein. Your credit card interest rate remained between 13% and 21%. So, while you struggle to pay bills with your declining real income, the Wall Street bankers are again generating record profits and paying themselves record bonuses. Profits are so good, they can afford to pay tens of billions in fines for their criminal acts, and still be left with billions to divvy up among their non-prosecuted criminal executives.

Bernanke and his financial elite owners have been able to rig the markets to give the appearance of normalcy, but they cannot rig the demographic time bomb that will cause the death and destruction of our illusory retail paradigm. Demographics cannot be manipulated or altered by the government or mass media. The best they can do is ignore or lie about the facts. The life cycle of a human being is utterly predictable, along with their habits across time. Those under 25 years old have very little income, therefore they have very little spending. Once a job is attained and income levels rise, spending rises along with the increased income. As the person enters old age their income declines and spending on stuff declines rapidly. The media may be ignoring the fact that annual expenditures drop by 40% for those over 65 years old from the peak spending years of 45 to 54, but it doesn’t change the fact. They also cannot change the fact that 10,000 Americans will turn 65 every day for the next sixteen years. They also can’t change the fact the average Baby Boomer has less than $50,000 saved for retirement and is up to their grey eye brows in debt.

 

With over 15% of all 25 to 34 year olds living in their parents’ basement and those under 25 saddled with billions in student loan debt, the traditional increase in income and spending is DOA for the millennial generation. The hardest hit demographic on the job front during the 2008 through 2014 ongoing recession has been the 45 to 54 year olds in their peak earning and spending years. Combine these demographic developments and you’ve got a perfect storm for over-built retailers and their egotistical CEOs.

The media continues to peddle the storyline of on-line sales saving the ancient bricks and mortar retailers. Again, the talking head pundits are willfully ignoring basic math. On-line sales account for 6% of total retail sales. If a dying behemoth like JC Penney announces a 20% decline in same store sales and a 20% increase in on-line sales, their total change is still negative 17.6%. And they are still left with 1,100 decaying stores, 100,000 employees, lease payments, debt payments, maintenance costs, utility costs, inventory costs, and pension costs. Their future is so bright they gotta wear a toe tag.

The decades of mal-investment in retail stores was enabled by Greenspan, Bernanke, and their Federal Reserve brethren. Their easy money policies enabled Americans to live far beyond their true means through credit card debt, auto debt, mortgage debt, and home equity debt. This false illusion of wealth and foolish spending led mega-retailers to ignore facts and spread like locusts across the suburban countryside. The debt fueled orgy has run out of steam. All that is left is the largest mountain of debt in human history, a gutted and debt laden former middle class, and thousands of empty stores in future decaying ghost malls haunting the highways and byways of suburbia.

The implications of this long and winding road to ruin are far reaching. Store closings so far have only been a ripple compared to the tsunami coming to right size the industry for a future of declining spending. Over the next five to ten years, tens of thousands of stores will be shuttered. Companies like JC Penney, Sears and Radio Shack will go bankrupt and become historical footnotes. Considering retail employment is lower today than it was in 2002 before the massive retail expansion, the future will see in excess of 1 million retail workers lose their jobs. Bernanke and the Feds have allowed real estate mall owners to roll over non-performing loans and pretend they are generating enough rental income to cover their loan obligations. As more stores go dark, this little game of extend and pretend will come to an end. Real estate developers will be going belly-up and the banking sector will be taking huge losses again. I’m sure the remaining taxpayers will gladly bailout Wall Street again. The facts are not debatable. They can be ignored by the politicians, Ivy League economists, media talking heads, and the willfully ignorant masses, but they do not cease to exist.

“Facts do not cease to exist because they are ignored.” – Aldous Huxley

 

TRYING TO STAY SANE IN AN INSANE WORLD – PART 2 « The Burning Platform

TRYING TO STAY SANE IN AN INSANE WORLD – PART 2 « The Burning Platform.

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