GDP (Gross Domestic Ponzi)

[peilthetraveler]

Its getting obvious to all now that our GDP growth is only because of stimulus/low interest rates and such things like that, but today I was wondering....how long has this ponzi been going on and what is our REAL GDP without stimulus and low interest rates? It occurs to me that this ponzi scheme has been going on since the dot com bubble and that pretty much all growth from there is false growth. The fact that we are now injecting more than a trillion dollars per year into the economy to keep up a 1 or 2% growth every year makes me realize that this ponzi must be on its last legs. Just like those guys at health south who were faking the books so much to report bigger and bigger growth numbers that they were eventually paying more in taxes on their fake earnings than they were making in revenue.


So now I wonder....what is our real GDP? If I had to throw a guess out there, i would say its probably what it was in the early 90s....maybe less since we sent alot of jobs overseas since then and our cars have lost their market share. So maybe our REAL GDP is somewhere between 5 to 6 trillion and its only the stimulus & low interest rates that is keeping it artificially at 14 trillion. Just my humble opinion though, but I dont think im too far off the mark.

 

[S2007S]

Quote from peilthetraveler:

Its getting obvious to all now that our GDP growth is only because of stimulus/low interest rates and such things like that, but today I was wondering....how long has this ponzi been going on and what is our REAL GDP without stimulus and low interest rates? It occurs to me that this ponzi scheme has been going on since the dot com bubble and that pretty much all growth from there is false growth. The fact that we are now injecting more than a trillion dollars per year into the economy to keep up a 1 or 2% growth every year makes me realize that this ponzi must be on its last legs. Just like those guys at health south who were faking the books so much to report bigger and bigger growth numbers that they were eventually paying more in taxes on their fake earnings than they were making in revenue.


So now I wonder....what is our real GDP? If I had to throw a guess out there, i would say its probably what it was in the early 90s....maybe less since we sent alot of jobs overseas since then and our cars have lost their market share. So maybe our REAL GDP is somewhere between 5 to 6 trillion and its only the stimulus & low interest rates that is keeping it artificially at 14 trillion. Just my humble opinion though, but I dont think im too far off the mark.

The gdp is being propped up by stimulus but nobody will tell you this, everyone still believes the growth this economy is seeing now is through real economic activity.....

How long they can float the economy to make it look like its growing 3%+ a year is beyond me, but there is no possible way these kind of figures can sustain themselves once bubble ben bernanke turns off the printing press.

 

[rubibond007]

Good post.. However, somebody has to spend and in this kind of special situation. The government is the one who will perform that role in this kind of economy.. That's the way our system is designed since we invented the Fiat money.

Sooner or later this will end, probably in a very bad fashion...

But maybe not.

 

[rubibond007]

You have a very good point, but the thing is that we don't have a historic measure how this will end, cause this is the greater recession since we invented the Fiat money system. Nobody has a real clue How this will really end. Every single economist out there is trying to find a paralel, but is not that easy.

The real and only 3 historical paralel that we have are the 1978-1982 semi-depresion 1991-1992 recession and the 2000-2002 mega recession, In those cases the FED did the same thing (mad spending) and They were very successful.. The think that The Money Has to Come from Somewhere (at some degree they have a point).

The reality is that this type of manipulation of the markets masks where resources, or money, ultimately comes from. It comes from the taxpayer. The government doesn't create Gross Domestic Product, they just limit and control how it is done.

The Federal Reserve sees a liquidity problem, They don't real care about inflation (they think that it easier to fight inflation that a stagflation).

Every single person who think that the Bush/Obama.greenspan/bernanke administration was/is doing is the right thing should go to a mental facility.

Fiat money is all about perception, not real value, and That's my friend is our only bullet left.

Quote from S2007S:

The gdp is being propped up by stimulus but nobody will tell you this, everyone still believes the growth this economy is seeing now is through real economic activity.....

How long they can float the economy to make it look like its growing 3%+ a year is beyond me, but there is no possible way these kind of figures can sustain themselves once bubble ben bernanke turns off the printing press.

 

[observer67]

Quote from peilthetraveler:

Its getting obvious to all now that our GDP growth is only because of stimulus/low interest rates and such things like that, but today I was wondering....how long has this ponzi been going on and what is our REAL GDP without stimulus and low interest rates? It occurs to me that this ponzi scheme has been going on since the dot com bubble and that pretty much all growth from there is false growth. The fact that we are now injecting more than a trillion dollars per year into the economy to keep up a 1 or 2% growth every year makes me realize that this ponzi must be on its last legs. Just like those guys at health south who were faking the books so much to report bigger and bigger growth numbers that they were eventually paying more in taxes on their fake earnings than they were making in revenue.


So now I wonder....what is our real GDP? If I had to throw a guess out there, i would say its probably what it was in the early 90s....maybe less since we sent alot of jobs overseas since then and our cars have lost their market share. So maybe our REAL GDP is somewhere between 5 to 6 trillion and its only the stimulus & low interest rates that is keeping it artificially at 14 trillion. Just my humble opinion though, but I dont think im too far off the mark.

Excellent post.

 

[Martinghoul]

This is silliness... Even if you assume constant trend growth starting from the 80s, you'll arrive at the real (as opposed to nominal) GDP of somewhere arnd $10trn. That's a rather conservative estimate, as it assumes no TFP increases.

 

[Kassz007]

Quote from peilthetraveler:

Its getting obvious to all now that our GDP growth is only because of stimulus/low interest rates and such things like that, but today I was wondering....how long has this ponzi been going on and what is our REAL GDP without stimulus and low interest rates? It occurs to me that this ponzi scheme has been going on since the dot com bubble and that pretty much all growth from there is false growth. The fact that we are now injecting more than a trillion dollars per year into the economy to keep up a 1 or 2% growth every year makes me realize that this ponzi must be on its last legs. Just like those guys at health south who were faking the books so much to report bigger and bigger growth numbers that they were eventually paying more in taxes on their fake earnings than they were making in revenue.


So now I wonder....what is our real GDP? If I had to throw a guess out there, i would say its probably what it was in the early 90s....maybe less since we sent alot of jobs overseas since then and our cars have lost their market share. So maybe our REAL GDP is somewhere between 5 to 6 trillion and its only the stimulus & low interest rates that is keeping it artificially at 14 trillion. Just my humble opinion though, but I dont think im too far off the mark.

1) Government expenditure is and always has been a part of GDP. If you want GDP without government expenditure, you are no longer looking for GDP. The number you are looking for is:
private consumption + investment + net exports

2) "Its getting obvious to all now that our GDP growth is only because of stimulus/low interest rates and such things like that..."

Such things like that???

 

[Scataphagos]

Quote from peilthetraveler:

"... Its getting obvious to all now that our GDP growth is only because of stimulus/low interest rates and such things like that, but today I was wondering....how long has this ponzi been going on and what is our REAL GDP without stimulus and low interest rates?

Could write a thesis on this topic.

Remember GreenScam telling us, "don't worry, be happy... inflation's only 2%?" Well, by some measures it was really about 8%!

REAL wages (measured in buying power) have been in decline for at least a decade.

The genuine numbers are buried somewhere, but it's reasonably possible that in REAL terms, the USA has been in recession for at least 5 years, maybe 10 or more... when measured with something other than "final prices (GDP)"... that number contains a SIGNIFICANT inflation component which is under-reported by the "keepers of the flame", and under-recognized by the hoi polloi.

 

[Emini Maestro]

Quote from peilthetraveler:

So now I wonder....what is our real GDP?

You're never going to know that. They won't tell you.

Come on, guy. Would you expect transparency from any political group, including this administration or the Fed? Wasn't it a clue to you when the Fed stopped releasing M3 data to the public? There are some things they don't want you to know...

 

[Scataphagos]

Quote from Emini Maestro:

You're never going to know that. They won't tell you.

Come on, guy. Would you expect transparency from any political group, including this administration or the Fed? Wasn't it a clue to you when the Fed stopped releasing M3 data to the public? There are some things they don't want you to know...

M3... I remember their excuse to stop reporting it... "Too much trouble to collect, not worth the effort".

Does anyone with half-a-brain believe that bilge?