Economy 'Rolling Over' As Fed Stimulus Wears Off

by JASmius

....or, put another way, the Obama Depression has built up a tolerance for Janet Yellen's wastepaper buzz:

The 4% economic growth that the government reported for the second quarter Wednesday....

....which will, by the end of September, be quietly cut in half or more, meaning a maintained net GDP contraction for the year....

....doesn't mean much, says Peter Schiff, CEO of Euro Pacific Capital.

He maintains that the economy has been in recession for the entire Obama presidency, which began in January 2009.

Unlike the Obamaconomy, JASmius echo syndrome shows no signs of slowing down.

According to official records, the recession started in December 2007 and ended in June 2009. But gross domestic product, the most complete measure of the economy's output, must grow 5% to indicate a recovery, Schiff told Yahoo.

"People are losing their full-time jobs, housing is terrible, the price of food and utilities is rising," he said. "The economy is rolling over, and the euphoric effects of cheap money are wearing off."

And, purely coincidentally....:

U.S. stocks joined a global selloff, erasing the year’s gains in the Dow Jones Industrial Average, as Exxon Mobil Corp. to Micron Technology Inc. tumbled amid weaker corporate results....

The Dow fell 317.06 points, or 1.9%, to 16,563.30 at 4 p.m. in New York, for the largest one-day retreat since February 3rd. The Standard & Poor’s 500 Index slid 2%, the most since April 10th, to 1,930.67. The gauge dropped 1.5% in July, its first monthly decline since January. The Nasdaq 100 Index lost 2.1%. The MSCI All-Country World Index tumbled 1.5% for its worst loss in almost six months.

“The Fed is stepping out of the way and the market’s valuation is high enough that people are quick to take profit,” Wayne Wilbanks, who oversees $2.5 billion as chief investment officer at Wilbanks, Smith & Thomas Asset Management LLC in Norfolk, Virginia, said in a phone interview. “You are going to get more days like today, where investors are more trigger happy, quicker to liquidate. Everybody knows a correction is coming and it will come.”

Oh; you mean, like this?:

The S&P 500 lost 2% Thursday, and that may just mark a beginning of the decline, says Gina Martin Adams, senior equity strategist for Wells Fargo.

She predicted at that start of the year that the S&P 500 would end 2014 at 1,850, little changed from the end of 2013.

"Our price target for the end of the year implies that we're probably about 5% down [4.2% down from Thursday's close] at the very least, at some point in the second half of the year," Adams told CNBC." 

You have to prepare yourself for up to 10%. Ten is very normal in the grand scheme of markets, and would actually be fairly healthy, washing out some of that excess optimism we've developed and some of the complacency we've developed."

I guess the Regime has decided that a stock market crash is a more useful exploitable crisis than a hyperinflation.  Although I'm confident they can still pull off both.