I dedicated half of the post to the confusion that the media, the government, and Wall Street is creating about the real state of the economy.
Insufficiently versed in economics, finance, or statistics myself, I did not offer my personal judgments. I relied on Robert Reich and Richard Eskow, two thinkers who would naturally be likely to cheerlead the administration’s economic policies.
Today, however, I came across two columns on the same theme, by a hedge fund analyst and advisor named Graham Summers. Links here and here.
As Summers explains: “I’ve been railing against ‘massaged‘ government data for years. Whether it’s GDP numbers, housing data, unemployment claims, or retail numbers, virtually every economic metric the Government or state department publishes these days is massaged or adjusted to paint a picture that is far rosier that the real economic realities facing the US.”
He continues: “With a Presidential election coming up in 2012, I believe we are at the beginning of a REAL bull market in economic/ political nonsense. The massaged data, nonsensical proclamations, and other shenanigans we’ve seen over the last decade are JUST the beginning.”
As for the disconnect between the image and the reality, Summers is more negative than either Robert Reich or Richard Eskow. In his words: “Instead, we’re going to see economic data become even MORE divorced from reality, assertions that the economy is back on track, and that at worst there is the specter of a ‘double-dip‘ recession looming. Heck, even these fears are sugar-coated… literally (making an economic nightmare sound like an ice-cream sundae is a GENIUS marketing move).”
Of course, Summers is also selling his own services. But he has a clear and well-defined point of view, supports it with data, and concludes that if keep consuming this steady diet of bull, one of these days we are going to get very sick.
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