The Golden Truth: Is the Economy Stabilizing like Bernanke and the Government Claim?

Thursday, August 20, 2009

Is the Economy Stabilizing like Bernanke and the Government Claim?

Just this morning, ex-Goldman Sachs CEO and current New Jersey Governor, John Corzine, was on CNBC proclaiming that the economy is stabilizing. Several Obama officials, including Secretary of Treasury Tim Geithner, and Federal Reserve Chairman Ben Bernanke also have publicly said that the economy has stabilized.

Let's look at some actual data and then you can decide.

Recent 2nd Quarter earnings statements from major retailers:

Sears revenue down 10.3%, same store saled down 8.6%
Dick's sporting sees 2009 same store sales down 5%Barnes and Noble sales sales down 5%, some store sales down 7%
Abercrombie & Fitch sales down 23%, same store sales down 27%
JC Penney sales 7.9% sales decline, same store sales down 9.5%

As retailing analysts know, these are horrific revenue numbers. The consumer is clearly not spending money.

Here's the most recent data from the much-heralded Cash for Clunkers program. It looks like it had about a 3 week boost to auto sales, and now according to Edmunds.com, there is a rapid decline in cash for clunkers sales, despite the Government tripling the total size of the program:

"The rush of automotive sales activity brought on by the "Cash for Clunkers" program is fading fast, according to Edmunds.com, whose latest study of car buyer behavior indicates that automotive purchase intent is down 31 percent from its peak in late July."

So Much for Detroit's Renaissance

We are also seeing several other grass roots metrics, like a shocking decline in consumer confidence reported on Tuesday, a sharp drop in the architectural billings index (leading indicator for construction) and a plummet in consumer credit and bank lending.

If our economic and political leaders are seeing signs of "stabilization," I'd love to know exactly what data they are looking at.

2 comments:

Roddy6667Thursday, 20 August, 2009
Don't forget to factor in inflation for these numbers. It's worse than it looks.
ReplyDelete
Replies
Dave in DenverThursday, 20 August, 2009
I totally agree with that, but I didn't want to get into any disputes about the Govt CPI vs. real inflation LOL
ReplyDelete
Replies

Add comment

Why Gold?

Gold is the world's oldest currency. You exchange your fiat currency (dollars, euros, yen, yuan) into gold as an insurance policy against catastrophic Central Bank and Government policies which serve to destroy the value of fiat currencies and destroy democracy.

Gold can ONLY be considered an investment to the extent that it remains significantly and historically undervalued in relation to the fiat currencies against which its value is measured. Otherwise it remains the world's oldest currency and is completely free from the counterparty risk associated with currency by Government fiat (i.e. fiat currencies rely on a Government's "full faith and credit.")

Quote Of The Month Courtesy of "Jesse"

Unfortunately for Larry Summers, Ben Bernanke, and their friends at the BIS, they have not yet figured out how to print physical gold, silver, and other essential commodities, and the world is reaching the point where it might simply start ignoring the New York based markets with respect to essential commodities such as basic materials, oil, foodstuffs, and the like, as they become increasingly irrelevant, fraudulent, and Orwellian. And then where will the financial engineers be, except with no more excuses and no place to hide?

Here is the link to his entire commentary, well worth a read:

http://jessescrossroadscafe.blogspot.com/2010/07/gold-daily-chart-shock-and-awe-for.html

Great Quote From Jim Rogers On Govt CPI Reporting

JR: I mean, we have inflation now. If you go to the shop, whether it’s groceries, or education or insurance or health care, prices are going up for everything. The government lies about it in the US. Some countries lie, many countries don’t: Australia, China, India and Norway. Many countries don’t lie about it and acknowledge that we have inflation. Others lie about it, the UK and the US, but if you go shopping you know prices are up.

Q: Are you saying that the American Consumer Price Index (CPI) published by the US Bureau of Labor Statistics is a lie?

JR: In my opinion, yes, of course it is. Have you looked at it? They’ve changed their accounting several times in the past few decades. When housing was 20% to 25% of the CPI and housing was going up, they didn’t count it, saying rents weren’t going up, and then when home prices started going down, they counted it. It’s the same with many things. It’s staggering some of the tortuous reasoning that the BLS has used over the past 25 or 30 years. When the price of gasoline goes up, they say it’s not really going up because it’s better gasoline, better quality, therefore you’re getting more for your money. I mean, it’s endless, the stuff that they say and for some reason people sit there, although more and more people are catching on, and accept what the government says.

source: www.clusterstock.com

Quote of the Week

"The primary function of a Central Bank is to engage in the massive transfer of wealth from the middle class to the wealthy elite. The Federal Reserve was set up to do this with the blessing and support of Congress." - Dave in Denver

If you refuse to believe the above, please read "The Creature From Jekyll Island: A Second Look at the Federal Reserve" by G. Edward Griffin and then explain to me why the Senate voted down the Vitter Amendment and Congress refuses to pass a law requiring a full audit of the Fed, even though the Fed is using taxpayer-backed money to bailout Wall Street and Europe.