Charts We Have Recently Pondered
We come across a large number of charts every day, and below we show a few stock market related ones that we have found especially interesting. First a chart that was recently published by John Hussman. It shows the total value of US equities and bonds divided by GDP. Although one might object that GDP is a somewhat arbitrary choice for the purpose of this comparison, the chart nevertheless is testament to the economy's increasing 'financialization', which in turn is a direct consequence of decades of massive monetary inflation. Inflation spreads from its point of origin throughout the economy, but there are 'inner circles' that profit from it, as they are the earliest receivers of newly created money. Their profit comes to the detriment of later receivers, who find the purchasing power of their incomes diminished.
In the innermost circles we naturally find the government and the banking cartel, hence the 'financialization' effect. The financial sector becomes ever bigger, and represents an ever larger share of corporate profits. His happens notwithstanding interruptions like the 2008 crisis, as the largest financial firms as a rule are always bailed out when things go seriously wrong. That is what the banking cartel was set up for after all!