Monday, September 21, 2009

GDP once and for all

For you, the people, to really know what’s what and for you to see through the lies it is necessary to know what GDP really is, how it is measured and why it’s so important for our enemies to deliver positive numbers. GDP is all about blowing a handful of pixie-dust in our eyes to keep us looking at something irrelevant in order to keep something that is important out of the limelight. But even worse than that, this trickery can make us poorer over time.

Let’s start by looking at how GDP is normally calculated.

GDP = private consumption + gross investment + government spending + (exports − imports), or,
GDP = C + I + G + (X − M)

I want you all to take notice on a couple of things in this equation. Firstly exports VS imports or X-M. In the world of basic math this part means that if exports grow in relation to imports GDP increases. If imports grow, GDP goes down. The same happens if either goes down in relation to the other. Okay? With me? This is very basic math that you should be able to figure this out at middle school – which, of course, means that economist, Finance Mentalists, journalists and some other idiots cannot manage it.

What the equation also tells us is that if Government spends more, GDP goes up. You probably get this, but what you really need to know is that it has no real meaning what they spend money on. It can be daycare, roads or flowers, it does not matter. According to GDP calculation it is beneficiary to have people dig holes in ground, fill them up again, and do this over and over. In fact, this is what government often does, not directly, that would be too obvious, but through other schemes like “investigations” or useless government programs to hide unemployment. An investigation takes manpower, costs money and often leads to conclusions a monkey could tell us beforehand. Anything being done to cover up people’s lack of jobs also cost money. Actually it may cost more, in essence contribute more to GDP, then if people in fact had productive jobs.

The same goes for private consumption. The more we shop ‘till we drop, the higher GDP. In the eyes of Keynesians and our enemies it means that the more stuff you buy, the better. This private consumption is not really subjected to any scrutiny other than the notion of spending. If you borrow, use your credit-card or (hardly ever) work to get that money to spend it, is irrelevant, what matters is GDP. Sometimes you can hear one or two voices claiming that savings are to low or that there is a difference in what we actually consume, but those are very few and not nearly as interesting for the media to quote.

All this mentioned is why they are keeping interest rates at zero, throws cheap newly printed money into the system and encourage you to take loans. This is also the main reason why the regime, any of them, continues to bail-out banks, because without getting you and themselves into debt, the system does not really work. The entire structure is built around and dependent on debt. Journalists, pundits, cornflake economists and teachers have either fallen for this swindle or are in cahoots with the elitists.

It is not bad to be in debt, you might claim, and correctly so, but then only if this debt is based on actual value or income. What is bad is when you use loans to buy stuff, in particular when you buy stuff you already have or don’t need and this on the assumption of income or value.

Once and for all: Consumption does NOT CREATE wealth!

What creates value is our productivity, or rather that we actually produce things. If we take something from nature, transform it, mold it, paint it, and make it into something useful that creates value in form of electricity, saves us time or makes future production better, faster or cheaper, then we have created wealth.

Services can also contribute, but then only to enhance our wellbeing or to save time.

And consumption needs to come out of this, not be the basic of the entire system.

Consumption is a good thing and it is our “reward” for being good at producing.

Consumption is not, however, what drives the economy as this GDP-madness and our enemies would like you to think.

With this entire structure in mind, what do massive amounts of stimulus; more debt (both personal and public) and a complete focus on consumption lead us? It leads to poverty and less options. The more indebt we are, the more government spends and the more we are focused on services and consumption, the less actual wealth is created even if GDP goes up. This is why GDP can be positive, but we can still get poorer. It’s all a trickery of the mind, its one big con and you have fallen for it.

This is also one of the reasons why I, and many others, could see this crisis many miles away. To anyone that understand that 1+1=2 and 2-1=1, this depression is not a surprise, its only the logical consequence of too much government, too much regulations and too much consumption on borrowed money. So this crisis cannot be over, it’s a mathematical and factual impossibility, in fact we are just in the beginning of it.

Any budget not tackling the real issue is a horrible budget.
Any politician that wants you to consume instead of produce is your enemy. Journalists and pundits that are lap-dogs to the rich and powerful should be strapped down and be worked-over with a rusty serrated bread knife.

We are being screwed by the elitists and the sooner you wake up, the sooner we can work ourselves out of this mess.

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