I wasn't going to write anything else about the state of the economy, In April I was getting bored with the relentless bad news; stockmarket plunges, company collapses and endless Government "stimulation" plans to resurrect economies all around the world and I thought I would devote my writing to getting down to the day to day business of the operation of the stockmarket and company performance.
Oh how things have changed.
Gee, now that the economy is improving, I thought I would have another go at telling you what I think about our economic situation and the apparent green shoots that are now starting to turn into large bamboo poles.
All the signs are that a large number of global economies are improving, economic indicators are up, banks are doing better, company profits are consistent with forecasts, manufacturing looks like it might have reached bottom, more cars are being sold (mmm), all is rosy with the world and Elvis and Michael Jackson are recording a duet in a Burger King somewhere in Kentucky.
This may indeed all be happening, but if you ask yourself why, then you might find yourself uncovering more questions than you answer.
This apparent lazerous turnaround in our collective economic fortunes -it isn't even a very strong one but people are behaving like it is-is linked to one thing and one thing only, the shit load of money that Barrack Obama and his progressive mates the world over have dumped into their economies.
But that is a good thing and its real right?
Well, no is the answer to both of those questions.
I have pointed this out before but this money is being printed by various central banks worldwide and some of it is borrowed and eventually it is going to have to be paid back.
That means higher taxes for those that are working, the middle classes primarily, and more wealth used to service debt and less productivity, in other words another recession sometime in the future or a continuation of the current one.
Socialism doesn't work, borrowing money to give to people to buy cars, shoes, computers, purchase imaginary carbon credits and flat screen TVs may seem like a paradise that keeps the wheels of commerce greased but what it actually does is put off the inevitable.
I really hate to be a pessimistic little bastard but we should all be very skeptical of these signs of economic recovery because they hide the fact that it is based on a lie and is not sustainable in the long run.
I know we have been stimulated to the point of a straight jacketed stupor but we really should ditch the over-priced Starbucks, cigarettes and borrowed moola and wake up.
Dont get me wrong, economically things are going to get better and business is doing OK, we just have to "get on and do it". But its time for careful rethink when it comes to the signs that things are all rosy again.
They are not, and we should learn not to get carried away with it all as some of us are currently doing -the big bounce in global stockmarkets is evidence of that.
Cautious optimism is needed.
Back to stocks again tomorrow.
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