The Great Divergence: Orders Not So Durable, Stock Prices Bubble Higher

"U.S. factories reported flat demand for big-ticket goods in August, suggesting the economy continues to be restrained by sluggish business spending," reported The Wall Street Journal. They got that right (for a change)! In the stock market game of pin the tail on the number, the Journal pointed out that the economists it surveyed had, on balance, expected a drop of 1.5% in the seasonally adjusted headline fiction. The report noted some softness on a year to year basis, but did not look at the long term trend, nor how the numbers relate to stock prices. That's where we come in, because the numbers are meaningless without this perspective.

You need to login to view this content.

David Stockman’s Contra Corner isn’t your typical financial tipsheet. Instead it’s an ongoing dialogue about what’s really happening in the markets… the economy… and governments… so you can understand the world around you and make better decisions for yourself.

David believes the world -- certainly the United States -- is at a great inflection point in human history. The massive credit inflation of the last three decades has reached its apogee and is now going to splatter spectacularly.

This will have lasting ramifications on how governments tax and regulate you… the type of work you and your family members will have available and what you get paid… the value of your nest egg… and all other areas comprising your quality of life.

David Stockman's Contra Corner is the only place where mainstream delusions and cant about the Warfare State, the Bailout State, Bubble Finance and Beltway Banditry are ripped, refuted and rebuked. Subscribe now to receive David Stockman’s latest posts by email each day as well as his model portfolio, Lee Adler’s Daily Data Dive and David’s personally curated insights and analysis from leading contrarian thinkers.