FACT VS Fiction #5 From Casey Research

FICTION: The U.S. government has everything under control.
FACT: The U.S. government is on tilt.

At this point the list of hastily conceived, politically motivated spit-and-plaster fixes that have been cobbled together by the government in an attempt to fix the economy - versus just getting the hell out of the way and letting the economy fix itself - could fill a book.
The only thing that matters to the administration and its allies is to corral a sufficient number of votes to get through the November elections on their collective(ist) feet.
Today, as I write, the news broke that Goldman Sachs has been charged with one of its many frauds. I should have seen this coming, as they had become - in the minds of Obama's core constituents - the poster child of Wall Street's greed. In addition, the firm has very, very deep pockets - just as Drexel Burnham Lambert did when the government laid them low with a $700 million fine... virtually none of which was then passed on to the purported victims of their indiscretions.
In the case of Goldman Sachs, I suspect that they may have become too clever by half - and that they've crossed some lines that will now be used by their erstwhile friends in Washington to string them up. And, in so doing, provide Team Obama with a win-win of appearing as a staunch opponent of Wall Street fat cats, while simultaneously confiscating another several billion to be cycled into the furnace of federal spending.
At this point, the only sane way to view the government is as an out-of-control gorilla that is wildly grabbing in all directions. As Goldman Sachs may be about to learn, once the gorilla has caught a hold of you, you've got real problems.
Unfortunately, the gorilla has grown so large that at this point it has its arms around the most of the economy. Counterproductive tax hikes are already baked in the cake and, if the administration has its way, it will soon try to layer on the mother of all tax increases in the form of a VAT. (I think at that point we might actually see riots in the streets.)
In Prechter's video, he echoes our constant admonitions to be careful and to be largely in cash just now. Words to the wise.