No Recovery For You!

According to statistical definitions the US economy is recovering. The GDP is 1.7% above its pre-contraction peak. But looking at this chart one could not know that:

source: Mauldin @ marketoracle.uk.com

What is driving the improvement are credit and government transfer payments shown in these charts:

source: Mauldin @ marketoracle.uk.com

After plunging during the crisis period, total revolving credit used by consumers is on its way up again. The increase in personal income less transfers such as social security payments, food stamps and unemployment insurance was 4.2% compared to an increase in transfers of 18.9% from pre-contraction peak to June 2012. In an average recovery wages and salaries would have increased 11%. Yet the federal minimum wage remains in a state of frozen animation at $7.25 an hour after being raised from a feudal $5.15/hr. Most economists think that a living family wage is in the neighborhood of $14.00 an hour. Barry O'Bomber promised to lift the wage above $9.00 when he wanted your vote, but has not taken any public action to increase it. So the debt bubble is expanding once again, thanks to your bailed buddies at Wall Street.con.