Kong Sez:

    What Is Truth? People hear and see the truth, but scales are upon their eyes. They don't want to know the truth...otherwise, they have to give up something and change.

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Read What Dr. Gary North, Ph.D.,
Reports on his Member Only Website About:
Truth

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Lunacy in Financial Reporting: It Just Gets Worse
Gary North
May 30, 2009

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    To keep from getting ruined in what is to come, you had better be able to spot the misleading reports from the media. The reports are written by people who cannot think straight.

    Let me take an example. It was published yesterday on Bloomberg's site.

    First, the two trends that need explaining.

Confidence among U.S. consumers rose this month to the highest level since September, while business activity shrank at a faster pace than forecast as the auto slump rippled through the economy.

    This reads like a head-on collision is in the offing.

    How to sort it out?

"The worst of the recession has passed, but it will take some time before we will see anything close to normal conditions," said David Resler, chief economist at Nomura Securities International Inc. in New York.

Rising confidence limits the risk that consumer spending, the biggest part of the economy, will peter out after increasing in the first quarter.

    Consumer spending will not peter out. Really? When business activity shrank? Why are businessmen so pessimistic, if consumers will be spending? Which figure are we supposed to believe?

    I believe businessmen's assessments of the future of the economy. Their money is on the line.

The Commerce Department also reported today that the economy shrank at a 5.7 percent pace in the first quarter, less than the government estimated last month. Following the 6.3 percent pace of decline in the last three months of 2008, the drop capped the worst six-month performance in five decades.     Pay attention to this.

Consumers' spirits are being buoyed by the improvement in stock markets and also because gasoline costs are down nearly 50 percent from July highs and mortgage rates are near historic lows, trimming borrowing costs for homeowners.

    The oil price is up over the last 3 months by almost 100%. July 2008 is irrelevant. That was the peak of the commodities bubble, when oil was $140. Why talk about July 2008? Because, oytherwise, the explanation is illogical: rising confidence because of lower prices. Gasoline prices have risen by 20% in one month. Mortgage rates have risen in the last month.

    Why is this good for consumers? Why is this the source of rising confidence?

"Consumers are looking at things like the rise in stocks, they are listening to reports talking about 'green shoots' and they believe it," Chris Low, chief economist at FTN Financial in New York, said in an interview with Bloomberg Television. "They believe that a recovery is coming but they don't see it in their current job prospects." Exactly! Consumer confidence is a lagging indicator historically.

Household wealth is being eroded by lower property values, and the economy has lost 5.7 million jobs since the recession began in December 2007. Economists predict the unemployment rate, at a 25-year high of 8.9 percent in April, may average 9.6 percent next year.

    All of which indicates that consumers' confidence is misplaced.

Automakers' woes may cause more plant closures, production cuts and job losses. General Motors Corp., the world's largest automaker until its 77-year reign ended in 2008, may file for bankruptcy protection on June 1, people familiar with the matter said yesterday. Chrysler LLC filed for bankruptcy on April 30.

    This is a cause for confidence? With Ford next?

Some executives have expressed optimism. Global capital markets have improved "dramatically," General Electric Co. Chief Executive Officer Jeffrey Immelt said this week.

"The worst is over" for the economic downturn, Immelt said in a speech in Tokyo. Improved liquidity and the ability to raise equity in capital markets have stabilized the economy, producing "green shoots." As a result, he's more confident now than any time in the last nine months, he said.

    He has been reading the financial press. He has not been looking at the underlying numbers.

    Green shoots are rhetoric used by the media to mask the reality of falling housing, rising commodity prices, and Federal Reserve inflation.

Kong Sez:

    Our environment is crumbling before our eyes...yet many do not even know it.

    Without the oceans, from which we get our life; or the rainforest, which help control weather patterns, life as we know it goes down.

    Even now, as we write this, there is a patch growing in the Pacific Ocean, twice the size of Texas, consisting of (mostly) plastic debris. The gyre (a circular or spiral motion or form; especially: a giant circular oceanic surface current) is between Hawaii and California. It goes from one inch to 300 (current measurements) feet down. It is devoid of marine life and it kills the aquatic life. Ships have to spend, if caught in that area, precious fuel in going around The Great Pacific Garbage Patch.

    Hmmmm....have we been good Stewards of the Earth. The Killing Mechanism is up and running!

The Second Ammendment!

Learn This...Memorize This...Let It Become a Part of You! Bring It Back When The Terrible Chaos Is Over...If There Is Something To Come Back To.

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Mr. Ugly Will Show Before Long.

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