Tuesday, December 01, 2015

False Economy



December, and as we brace ourselves for another slew of depressing economic figures it is understandable that consumers aren't spending.

Economists and business people describe national economies as being in one of two states, growth or recession (they never mention the S word of course - stagnation). What state the economy is decided by taking the sum total of certain types of transactions (selected by statisticians) and then deflating this total by a rate of inflation also devised by statisticians and not representative of the essential spending of ordinary people, but of the political interests of whoever is paying the statisticians. A nominal figure for gross domestic product is thus created, adjusted to take account of inconvenient factors like reality, and termed real GDP.

The fist thing to understand about GDP is that it does not measure the health of an economy but only the rate of churn of money within that economy. For example if a government allows one million migrants into the country and pays them £300 a week each, and these immigrants spend their benefits on food, housing, clothes, transport, a little entertainment and a few other things, GDP is increased by £300 million a week, and hey! The case for immigration benefitting the economy is made.

Another GDP scam understate the rate of price inflation, thus showing growth in GDP where in real terms there has been contraction. If GDP grows year on year by less than the rate of price inflation, in real terms the economy has contracted. More paper money has been spent but less goods and services have been paid for. From the inflation scam it only takes a small leap of flawed logic to associate rising prices with an increase in economic activity (i.e. to show more money has moved when we should be looking at the fact that less trade has been done. It also follows, based on the fallacious assumptions of GDP economics, that falling prices are to be avoided at all costs.

Assumptions and statistics. All statistics are based on assumptions and they lead to ridiculous conclusions. As Socrates said 2500 years ago, if we keep questioning in the end we come to the assumption or fallacy all established truths are founded on

The received wisdom that falling prices are bad for business is being questioned by some economists who have at last woken up to the fact that a double triple quadruple dip recession is in fact a depression. The improvement in everyone's standard of living through falling prices for communications, access to data, and the technology in our homes and everyday life could not possibly have happened, the glass is half full merchants chirrup. Here the fallacy stands out like a sore thumb, obviously if only half the glass is full, the other half is empty. For those in work whose earnings have kept pace with or moved ahead of inflation falling prices have been good, they can afford to fill the empty half of their glass. But what of those whose incomes have dropped. Or those formerly affluent people whose jobs have been offshored or taken over by robots. Falling prices, or rather the conditions that have caused prices to fall have not improved their lot.

It does not end there of course, as deflation bites because profits are being squeezed and tax revenues are falling, employment falls further, people in work cut back more, not knowing when they will be hit and unemployment rises. Then taxes must rise more to cover the increased welfare bill and people in work have less spare cash to spend. And so it goes on with that glass looking more empty than full all the time.

And spare a thought for the prostitutes in Greece who due to a glut on the supply side as women are forced to sell themselves to feed their families, and falling demand, are only able to charge €5 for half an hour.

If rising prices are good for the economy, as one school of economics tells us, how come everyone was so unhappy in Germany's Weimar Republic in 1923, or in Zimbabwe fifteen years ago? Surely, as inflation accelerates the happiness level should rise. Conversely as prices fall and consumer goods become cheaper, people's living standards improve and they should become happier. So how come wherever I look, it's only children and retired people with good pensions like myself who are happy.








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Driving Europe Towards Catastrophe

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Migrants Attack Locals In German Restaurant


by Arthur Foxake, 1 December, 2015


German firefighters clean up the mess after migrant Muslim morons torch the accomodation allocated to them (Image source)


Migrants and locals got into a fight in a restaurant in Bavaria on Sunday, resulting in a 50-year-old German man receiving serious head injuries.

A brawl developed between migrants and Germans developed in the Bravarian town of Velden , after an argument between a small group of migrants and local residents eating at a restaurant started in the early hours of Sunday morning, according Bravian regional newspaperSüddeutsche Zeitung.

Things appeared to have calmed down when the migrants left, but they returned with reinforcements and laid into the diners.

Around 15 people believed to be lodging in a local asylum centre had joined them, with witnesses reporting fist fights and glass bottles being thrown. One witness said the area outside the restaurant resembled a battlefield, covered in blood.

Six people were injured in the fight, with one 50-year-old German man needing hospital treatment for serious head injuries.

Police arrested a 25-year-old Syrian migrant, but later released him. The investigation continues.

The reason for the brawl is not reported, we wonder if the migrants might have objected to German diners eating pork sausage.

Elsewhere, in Hattersheim around 30 residents of another asylum centre were involved in a fight which left four people injured. Op-online.de reports. There police arrested two migrants aged 17 and 23, while four residents were moved to alternative accommodation for their own safety.

The violence follows a weekend of unrest in asylum centres across the Germany, with migrants expressing their anger that they are not being paid enough for being in Germany, their accommodation is not luxurious enough and the televisions in their rooms are not big enough.

In one asylum centre, the former Tempelhof air terminal in Berlin, police had to break up a fight between migrants queued over food. Again we are left to wonder if pork was involved.

Another fight in the Berlin suburb of Spandau (where the famous ballet is set?), migrants attacked one another with fire extinguishers. Windows were smashed and sofas thrown into the street, leaving several migrants wounded. Some 500 people had be to be evacuated from the migrant centre in fear and panic.

All in all, one has the impression that the paleolithic savages let into Europe without restriction by out politically correct leaders, who swore our culture would be enriched by these arseholes new arrivals, are simply not capable of living peacefully with each other, let alone alongside civilized people.