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February 15, 2019 | The Stock-market is NOT the Economy!

Donald B. Swenson: Born January 24, 1943, Roseau, Minnesota. Graduated H.S. 1961, Moorhead High, Minnesota. Graduated College 1968, Moorhead State University, Minnesota. Designated member of Appraisal Institute (MAI), 1974. Employed with Western Life Insurance Company, 1968 – 71; Iowa Securities Company, 1971 – 73; American Appraisal Company, 1974 – 81. Part-time teacher/valuation consultant/bartender, 1979 – 2008 (taught workshops at Waukesha County Technical Institute, Wi. and Madison Area Technical College, Wi.). Retired 2008 (part time teacher/blogger), AZ. Self educated economist/philosopher/theologian:

Image result for Mr. Trump says the stock market is going up and up

In today’s speech to the Nation, our President expressed his view that our economy is booming even as other nations economies have slowed. His view was that the booming stock-market represents our economy. Is this a valid view of economics?


I think our President has a distorted view of our economy and real wealth creation. Just because the stock-market is up (some 330 points as Mr. Trump was speaking) does not mean that our economy is booming. Digits go up with algorithmic trading even as our real wealth declines. Does Mr. Trump comprehend this?


As I write the retail sector of our economy is slowing significantly. The auto sector is slowing. The Baltic Dry Index (a measure of trade activity) is now at 628 (down some 50.59% since January 1, 2019). Exports from Japan are down. Exports from Germany are down. Real estate sales are slowing significantly.


Just because our digital stock-market goes up and up does not mean that our real economy is booming. Mr. Trump needs new economic advisers who can discern what is really happening at the ground level. Do any of his advisers comprehend that more computer digits does not mean real economic growth?


Our electronic markets can distort what is really happening at the ground level. I have noticed this for years. Algorithms can pump up these digits which show up on our stock indices boards. These digits, however, are not wealth. These digits do not reflect real wealth creation. They reflect what traders are doing with their algorithms.


We have a distorted and rigged trading market which deceives our politicians and most financial pundits. The purpose of a real stock index is to reflect what happens at the ground level. Is real wealth being created and produced? Are more cars being manufactured. Are consumers buying more products at our retail outlets?


If consumers are buying less and production is not growing then our real economy is actually declining. Stock digits can deceive as these numbers get created artificially by our traders and their algorithms. Today, trading is mostly algorithms and high-speed computer operations


Mr. Trump may think all is well when he sees these stock indices going up and up. When our money was tied to material reality, this was a valid view. Today, our digit money units are tied to nothing and represent nothing. There is NO VALUE in these computer trading digits. These digits are ‘imaginary’!


It may be wise for our President to get some new economic advisers. His lack of discernment and understanding is unhealthy for his marketing program of Making America Great Again. That is my personal view. Think for yourself! As I write the Dow Index is at 25,755 (up some 316 points)! Where is the new wealth?


I am:

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February 15th, 2019

Posted In: Kingdom Economics

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