Dear Reader,
Is President-elect Trump inheriting a “turd” economy? Money man Edward Dowd:
- There is government spending and government hiring to paper over what is truly a bad economy for the average man… The real economy has been rolling over, and we are just waiting for the financial markets to figure this out.
- When they do, Trump is going to inherit a turd of a financial market crisis. Government statistics will be updated, and it will show we started a recession sometime this year…
- The incoming Trump Administration has to get out in front of the narrative. This was already baked into the cake. They just got handed fraudulent books. So, they are basically going to get blamed for what is coming.
I believe this Dowd fellow has hooked onto something.
The Jalopy Economy
Here I substitute his scatalogical reference for an automotive reference: I believe the United States economy is a jalopy economy.
It gives the appearance of an exotic racing auto — sleek, finely lined, waxed to a blinding sheen.
In the official telling, unemployment gutters near 50-year lows.
The stock market knocks down one record after the other. The consumer is flush… and eager to drain his wallet.
This is the tale the mainstream media yells into our ears.
Yet beneath this racer’s shining surface lurks a lemon.
The transmission slips gears. Cracks run through the pistons. Rust corrupts the engine block… and oil oozes from every seam.
Statistical Wizardry
We have witnessed the illusory triumph of statistics.
Statistics are often lovely liars. They tell fabulous tales beyond compare.
How does the phrase run? There are lies, damn lies — and statistics?
For example: The near record-low unemployment is more statistical wizardry than actual record-low unemployment.
This August the Bureau of Labor Statistics issued a downward revision of previous unemployment data — not a soft rounding — but a severe revision.
Economist E.J. Antoni:
- The labor market is nowhere near as strong as is being portrayed… Nonfarm payrolls were grossly overestimated by almost 1.2 million for a 12-month (period). That’s more than a third of the alleged job growth during that time.
- Something is clearly wrong at the Bureau of Labor Statistics, given how consistently the number of jobs has been overestimated.
As the fellow said, “clearly.”
Anti-Jobs
Meantime, many fresh jobs have been government jobs. That is, many fresh jobs are essentially anti-jobs.
Source: Bureau of Labor Statistics, MarketWatch
Government jobs are not economically productive. They are economically parasitic.
You must first recall that government lacks all resources.
Imagine a parasite with its fangs sunk into a host. You have just imagined a government.
Some government jobs — I concede hesitantly the possibility — may be necessary.
The host/parasite relationship nonetheless obtains.
The Taxpayer Pays One Way or Another
Before government can shovel out one meager dollar for guns, for butter, for bread, for circuses… it must first pluck it from private pockets — directly or indirectly.
That is, through taxes or borrowing. That is, through taxes or taxes.
The dollar borrowed appears a lesser plucking than the dollar taxed.
But it is an equal plucking. It is merely a plucking at one remove.
Do not forget, the borrowed dollar must be repaid — with interest into the bargain. And who pays the interest?
The answer, at all times and in all places, is the taxpayer. He stands in back of the entire governmental apparatus.
Upon his drooping shoulders it rests fully.
Fake GDP
Government at all levels is credited with a thumping 36% of United States GDP spending.
Yet its contribution to the gross domestic product is largely a false contribution.
Assume the government pays a fellow to shovel a hole. Assume further this government pays him to empty the dirt back in.
In the official telling you have just witnessed an increase to the gross domestic product.
Have you? Or have you merely witnessed a sort of statistical leg-pulling, a statistical parlor trick — and a mighty squandering of time, effort and resources?
Thus today I haul the government statistician into the dock.
It is he who collects, sorts, worries, goons, tortures and weaponizes economic data.
It is he who stretches the numbers upon the torture rack and proceeds against them in truly barbarous fashion — until the numbers confess.
It is he who throws false weights upon scales in support of government policy x or government policy.
I’ll Say Whatever You Want Me to Say
If the government adds one cup of inflationary water to one cup of whole milk… do you have two cups of milk?
The government statistician will say you do. Yet two cups of watered milk do not constitute two cups of whole milk.
They constitute two cups of watered milk.
Yet if the administration requests a vastly exaggerated GDP reading, the government statistician will torment the numbers into compliance.
If the administration requests a vastly reduced inflation reading, the government statistician will torment the numbers into compliance.
If the administration requests a vastly reduced unemployment reading… the government statistician will torment the numbers into compliance.
He would tell you twice two is not four — that it is five, 11 or 343 trillion — if he needs to.
They’re Going to Blame Trump
In short: I trust the government statistician no further than I would trust a dog with my dinner.
He has presented the illusion that ours is a race car economy. I am far more convinced of the jalopy theory.
This economy Mr. Trump will inherit. And as the abovesaid Edward Dowd noted, this economy is poised to “roll over.”
If it does — when it does — the president’s critics will point accusing fingers in his tanned, creased face.
They will yell that the fault is his. Yet they will finger an innocent man.
They should finger instead Joseph Robinette Biden — along with the Congress, Treasury and Federal Reserve that enabled him.
If it is justice you seek, point your finger at them.
Regards,
Brian Maher
for Freedom Financial News
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