False Market News

President Trump has railed against false news as the MSM (Main Stream Media) report (?) his horrendous doings as they are determined to delegitimize his administration by any means possible. 

Dr. Walter Snyder –   www.swissfinancialconsulting.ch

Wally`s Newsletter No. 169

Likewise the Fed and Wall Street attempt to pass off dubious statistics as proof that the economy and stock markets are fairing well. They do not want people to panic but to continue buying what is for sale.

The preposterous claims of Russian interference in the 2016 presidential election are matched by the ridiculous statistics promulgated by the BLS (Bureau of Labor Statistics or rather Bureau of Laborious Statistics). It is a difficult feat for the imagination to believe that US unemployment is only 4.5% when 95 million people of working age are not in the work force now as opposed to 79.5 million not in the work force in 2000, further considering that in 2000 the US work force was 156 million and in 2017 it is 153 million with a total population of 325 million. If one reckons 95 million not in the work force plus 6.8 million officially unemployed persons, one ends up with 101.8 million. One can calculate that the real figure of unemployment is 40% if one includes the officially unemployed and those not in the work force. That figure is a bit high because it will include students and invalids as well, but even so the number produced by the BLS cannot be considered even close to reality. But such figures are useful arguments for the Fed to raise interest rates.

The Fed claims inflation rates are under 2% and were hovering at 1.5% or less for years. U.S. house prices have risen dramatically since 2008. In 2016 the rise was over 7% with 37% of homes sold for investment purposes and the home ownership rate the lowest in 50 years, the median price being around $250,000 according to Zillow. Such statistics do not suggest that the inflation rate is low. The S&P index has increased by 7% annually over the last ten years. Prices for equities and housing have increased far more than 2% annually. A 2% inflation target rate is unreal.

The lies go beyond economics and extend to politics. Claiming that Europe is now more stable thanks to the election of Mr Macron in France does not take into account that the state of emergency is going to become permanent and that there will probably be a violent general strike when the unions see the government changing the labor laws by decree. Italy`s banks are still in bad shape, and it is Mr Draghi who staves off European bond market collapse. The ECB will buy anything.

Investors must be critical of the manipulated statistics and lies spewed out by governments. The real question is how much longer the markets can be manipulated.

Quelle: AdvisorWorld.ch