9 Feb

The U.S. Economy Is Now Dangerously Detached From Reality

Brandon Smith @ Alt-Market.org:

Recently I was asked to give a presentation on the current state of the global economy to a local group of concerned citizens here in Northwest Montana. I was happy to oblige but when composing my bullet points I realized that, in truth, there were no legitimate economic numbers to examine anymore. You see, financial analysts have traditionally used multiple indicators of employment, profit, savings, credit, supply, and demand in their efforts to divine the often obscured facts of our financial system. The problem is, nearly every index we used in the past, every measure of capital flow and industry, is absolutely useless today.

We now live in an entirely fabricated fiscal environment. Every aspect of it is filtered, muddled, molded, and manipulated before our eyes ever get to study the stats. The metaphor may be overused, but our economic system has become an absolute “matrix”. All that we see and hear has been homogenized and all truth has been sterilized away. There is nothing to investigate anymore. It is like awaking in the middle of a vast and hallucinatory live action theater production, complete with performers, props, and sound effects, all designed to confuse us and do us harm. In the end, trying to make sense of the illusion is a waste of time. All we can do is look for the exits…

There is some tangible reality out there, but it is difficult to find, and there are few if any mainstream numbers to verify. One has to remember always that the fundamental world of money and trade revolves around real people and real circumstances. No matter how corrupt our economic system is, as long as there are human beings, there will always be supply and demand that cannot be hidden. We have to look past the “official numbers” and look at the roots of trade. Where has demand fallen? Where has supply diminished? Where are the tangible goods and needs and how have they changed?

Let’s first start with the mainstream version of our system, looking at each aspect of the economy that no longer represents the truth of our situation…

Employment, Savings, And Debt

Much of this information is old news to those of us in the Liberty Movement, who tracked the progress of the global collapse long before the general public even knew of its existence. However, it is useful to take a step back and look at the basic picture every once in a while.

According to numbers issued by the Department of Labor, weekly unemployment reports have dropped to a five year low, and the overall employment rate is holding at 7.9%. This would seem to be a vast improvement over the dreadful bloodletting in the system only a few years ago. Has the private Federal Reserve and the Obama Administration really done it? Have they turned back the tide on the greatest fiscal crisis the U.S. has seen since the Depression?

No. They haven’t.

They have only changed how the data is disseminated to the public. In order to understand how the employment statistics con is being engineered, it is important to understand the difference between “Adjusted” and “Unadjusted” numbers.

Labor Department data is “seasonally adjusted”, using a series of statistical assumptions including something called “Trend Cycle Analysis”. Trend Cycle Analysis is, basically, a sham, but a sham put together in a very complex and confusing manner. If you ask a mainstream economist what it is, you’ll likely get a three hour long dissertation filled with financial babble and very little concrete explanation. So let me break it down as simply as I can…

Imagine that you are going to estimate how much profit you plan to make in a particular month, but you don’t just consider your current pay rate and pop it into a calculator; you also throw in the possibility of a few pay raises, an inheritance from a grandma who might kick the bucket, and, your exaggerated expectations of the entire year’s profit on top of that. You may also take into account future bad weather, a mugging, a nuclear war….whatever. All hypothetical situations not based in reality. Basically, you decide that a particular trend in your income is inevitable, then, mold your statistical analysis around that assumption.

When your real profit numbers come in (the unadjusted numbers) and they do not meet your expectations, you simply change them according to what you believe SHOULD have happened. If you insist that your profits are going to go up for the year, and they go down for a couple months instead, you change the variables you use to calculate the statistical average so that the results match your expectations, assuming that it will all balance out in the end.

Now, this sounds utterly insane for the common person out there trying to make a living. If you ran your household this way, without accepting the cold hard unadjusted numbers in front of you, you’d find yourself broke and on the street in no time. Unfortunately this is EXACTLY how our government handles most financial data; by coming to a final conclusion before hand, and then forcing the numbers to fit that conclusion.

This is why in February of 2013, “adjusted” first week unemployment rate was reported at 366,000 – a 5000 person drop from the week before. A seeming improvement in the trend. But, unadjusted numbers came in at 386,176 – a 16,000 person spike from the week before. When one examines real unemployment numbers, he finds that the divergence between the adjusted and unadjusted statistics is growing larger with each passing quarter. That is to say, the contradiction is becoming so blatant between the hard numbers and the Labor Department’s fantasy numbers that one must question whether or not the government is lying to us outright about the state of the economy (hint – they are lying).

Read more

       

About Curt

Curt served in the Marine Corps for four years and has been a law enforcement officer in Los Angeles for the last 20 years.

6 Responses to The U.S. Economy Is Now Dangerously Detached From Reality

  1. Nan G says: 1

    People need to pay attention to this.
    But, you watch, they won’t.

    Exports Refuse to Obey President’s Command to Double
    http://michaelscomments.wordpress.com/2012/12/11/still-waiting-for-those-exports-to-double-and-waiting-and-waiting/
    http://bea.gov/newsreleases/international/trade/tradnewsrelease.htm
    http://michaelscomments.wordpress.com/2013/01/22/racist-exports-refuse-to-obey-presidents-command-to-double/

    Plotting full-time employment divided by the civilian non-institutional population yields a chart that looks like this:
    http://michaelscomments.files.wordpress.com/2013/02/fulltimeempvscivpopfeb2013.gif?w=460&h=194
    Obama’s taken us 3 years to get from 47% to 48%. At this rate it’ll take us another 12 years to get back to 52%, where we were during the eeeevil reign of George Bush.
    But I’m sure the President has a plan to throttle back this progress.

    Obama: “We can create a million new manufacturing jobs in the next four years.”
    The graph would look like the ”Rainbow line” here compared with REALITY.
    http://michaelscomments.files.wordpress.com/2013/02/manufjobsfeb131.gif?w=300&h=185
    http://michaelscomments.wordpress.com/2013/02/05/the-presidents-million-new-manufacturing-jobs-promise/

    The manufacturing job sector’s recovery has been pathetic. It has taken us 4 years to recapture 14% of the manufacturing jobs that were lost. President Obama is promising us that it’ll take another 4 years to recapture the next 28%.

    And after 8 years of Obamanomics, even if it’s completely successful, we still won’t be halfway to full recovery.

    Remember the BLIPS Obama has created to try to fool people into thinking the economy was doing better?
    There was the unemployment blip when Obama hired/fired/re-hired/re-fired thousands of US Census workers to make it APPEAR as though our unemployment had turned around dramatically.
    There was the artificial Cash4Clunkers blip in auto sales.
    There was an artificial home buying blip from Obama’s first time buyers discount.
    And so on and so on and so on.

    Earth Hour is a pretty good example of (perhaps even the pattern for) Obama’s policies.
    It makes people FEEL good, and it makes for good news copy.
    BUT it actually is counterproductive using up more energy than it saves!

    ReplyReply
  2. Brandon Smith
    thank you for that interesting POST, WELL EXPLAINING A COMPLICATED SUBJECT, I think,
    and what I retain is they are a bunch of crooks figuring with OBAMA,
    HOW TO FOOL THE PEOPLE JUST FOR THE INTENT OF MAKING HIM LOOK GOOD,
    HE WORK ONLY ON SELLING HIS IMAGE TO HIS CROWD,
    IS THERE A PRESIDENT IN THE UNITED STATES?
    OR A GROUP OF UNION’S PRESIDENT?
    WE KNOW THERE ARE ONLY ONE DEMOCRATE WITH MANY HEADS,
    POOR CONGRESS HAVE SUCH A HARD JOB, AND THEY ALWAYS GET BLAME FOR WHAT THE WHITE HOUSE IS BREAKING,
    I FEEL SO SORRY FOR THEM, THEY TAKE IT THEY GET KICK
    AND NEVER COMPLAIN,

    ReplyReply
  3. MOS 8541 says: 3

    So how much did the U.S citizens pay for the 21.3 million rounds of ammunitions to hls?

    ReplyReply
  4. MOS 8541
    HI,
    DO YOU THINK IT MIGHT BE FOR THEIR FRIENDS FOREIGNERS
    OBAMA IS VERY GENEROUS WITH THEM.

    ReplyReply
  5. FAITH7 says: 5

    New study confirms economy was destroyed by Democrat policies …
    Dec 21, 2012 … The study painstakingly sorted through failed home loans that caused the housing market collapse and identified an overwhelming connection …
    http://www.examiner.com/…/new-study-confirms-economy-was-destroyed-by- democrat-policies

    AND, The Left STILL wants to blame this on Bush…
    If anyone with common sense took a moment to research this or even think realistically about it….The ‘Pressure’ from Democrats and their ‘arm’ the Left Wing Liberal Community Activists [one being the CORRUPT now defunct "ACORN" ] it is they who ‘pushed’ an AGENDA….TO PUSH THROUGH AND LEGISLATE POLICIES….MANY which THE GOVERNMENT pressured the BANKS to make loans [BACKED BY FREDDIE/FANNIE] to people who couldn’t afford the loan in the first place IN THE NAME OF wait for it… “FAIR NESS” “SOCIAL JUSTICE” ….

    A Republican(s) would not take this “TYPE” of route on their own…and certainly not without Left Wing Liberal/ Dem Pressure… It was a disastrous decision as we can see NOW!! As with many “feel good” disastrous [in the long run] policies made from a Liberal Utopia mindset…

    Just like this Far Left President is doing to the Republicans today….if the Republicans don’t agree with the Presidents Ideology and hurtful [feel good] policies…then they are painted as the BAD GUYS…EVIL ….Oh and Yes Yes…RACISTS!?! Republicans will be painted as evil no matter what….How having ‘ Common Sense ‘ and looking at the big picture – became “evil” I will never know…

    And the Republicans are a disappointment today anyway….they cave like idiots….we need a true REAGAN CONSERVATIVE in Washington. Boehner is a disappointment…

    ReplyReply
  6. FAIGHT7
    THERE ARE many demands for impeachment,
    something will come out of it.

    ReplyReply

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

 

Switch to our mobile site