Inevitability of Failure in the United States

Stocks waver after surprise drop in sales of existing homes, lower rating on BNP Paribas

Who is this surprising? This was telegraphed (anticipated) by a review of the trends over a month ago.

Home construction up, building permits fall, May 18th

The leverage setup in lumber and recent trend line break of the counter trend rally suggested the short-lived nature of the housing rebound long before the new homes sales or building permits data.

Keynes never advocated perpetual deficit spending, thus, the institutionalizing of structural deficits. Keynesian style stimulus only works if you terminate the deficit spending when demand returns. The perpetual cycle of deficit spending and unlimited borrowing has rendered today's stimulus (American Recovery and Reinvestment Act of 2009 and housing tax credits) impotent. This is why the game of musical chairs has ended in Greece and will end in the United States. It's only a matter of time, realization, and scope and magnitude of the aftermath. Gold is rising not because of the realization of failure in Greece but rather of the inevitability of failure in the United States.

Source: finance.yahoo.com