What to do with that 401k...

You are the steward of your 401k. After Enron, I warned everyone I knew that these people were playing fast and loose with the rules. Sure, Phil Gramm got a few things through in the late 90's but once the Bush free marketeers got into it, it was just nuts. I think Goldman Sachs was leveraged 33 to one for god's sake. Hank Paulson him self got the SEC to change the rules that he took advantage of, and then when he became treasury secretary, basically bailed himself out.

You don't have to be a genius to know if you pile up a bunch of money and don't pay anyone to guard it, it will disappear. The Bushies did this with cold hard cash they sent to Baghdad on pallets! Billions if cash right from the US Treasury. Then, they did it 1000 times bigger with credit default swaps and unregulated insurance instruments. The average 401k guy gets told to buy and hold, the long run is good, stay in stocks if you're young, yada yada yada... Meanwhile, they're pocketing your money, buying jets and private islands in countries with no extradition, no income tax, and no minimum wage.

Just imagine what would have happened if we fed this GOP genetic mutation our social security funds.

So, is the 401k a bad thing? Should you be buying in right now? Well, you can get some good stuff cheap right now. But the next time you smell a bubble, put it in a money market fund. I wish people had the option of just going into an index fund with no fees. In the long run, that's better than all that damn day trading anyway. But who knows... It could be Mad Max world soon, in which case you'll want to invest in sharp boomerangs and gasoline.

Economic Letter the the LA Times

In today's Business section, the LA Times mirrored the right wing administration's talking points about the economy, disguised as the jobs report, in which unemployment remained "steady" at 4.7% in October while the economy "added" 166,000 jobs. A deeper look is warranted.

In a Bloomberg article, albeit buried deep below the fold, we find the tip of the truth-burg:

"In contrast to the payrolls figures, a separate household survey showed a loss of jobs. The unemployment rate held steady because about 200,000 people left the workforce."

A little more investigation would reveal that 344,000 people left the work force in September and 340,000 left in August.

Further study of the October numbers reveals that the propaganda catapulters claimed that the real estate sector added 2800 jobs, and commercial banking added 1500, despite a housing slump. How is this possible?

The administration uses the Birth/Death Model to estimate job growth and unemployment. This statistical model is designed to see jobs created from new businesses that the job survey doesn't see. The US Department of Labor assumes these jobs were "created" based on the employment situation a year ago. So, this model cranks out numbers that say new financial service companies created 25,000 jobs in October, despite a worldwide credit crunch and the housing bust.

And the LA Times, along with all the other main stream media, parrots these numbers as if they're fact. Meanwhile, middle class American families are falling further and further behind, even though inflation is "low."

Which brings us to the GDP "growth" of 3.6% that this administration is reporting for the third quarter. This magic number is reached by counting inflation at .8%, the lowest inflation number for GDP purposes since Eisenhower. Meanwhile, the latest edition of the Economist magazine is reporting that inflation of "all items" (you know, the things people actually pay for like fuel, food and rent) at 16.7%. If we use the Economist numbers, we get a GDP of -12% annualized.

No wonder a corporatist government and their media friends don't want you to see the truth. We're in a deep recession.

And lying to the American people is basically treason. Corruption is theft. The Iraq war is the largest theft