Over the years, I have learned to become suspicious of government facts, financial reports, and financial data.
Economists are polled about their opinions. The resultant “guesses” are factored together to reach a consensus.
Depending upon the governments agenda, the results are added and subtracted, published and publicized then interpreted to reflect a positive or negative slant, with conflicting opinions excluded as irrelevant, if they do not support the desired agenda.
Last week, ( the end of August 09) the Gross Domestic Product( GDP) for the 2nd 1/4 of ’09 fell , according to the government, by 1%. The polled economists had predict a 1 1/2 % fall.
The market was encouraged by this ” less bad” news , took it as a sign of improvement, and continued the rally which had been underway since March.
Ben Bernanke, was hailed as savior of the economy, by President Obama, during his reappointment a Chairman of the Fed.
The truth is that they are attempting to create a new bubble to pull the economy out of the recession. Sadly the balloon has sprung several leaks, and the only way to keep the bubble inflating, is by pumping air at record deficit rates.
Don’t stop pumping or the bubble will deflate faster than it did in October of 2008.