Archive for Cnbc
The Real Crash
Posted by: | CommentsPeter Schiff has been ridiculed by the Keynesian elites and their media mouthpieces on financial networks like CNBC. For years Schiff thorough interviews and his books rang the alarm loudly over the bubbles lurking under the economic waters.
This podcast with Lew Rockwell is well worth the listen. I especially love the part where Schiff describes the education bubble and how modern medicine does little for the patient. Enjoy!
A Recession Would Be An Improvement
Posted by: | CommentsThe CNBC headline screams “Stocks End Sharply Lower on Recession Fears”. In another article on the same page, Barclay’s Capital Managing Director, Larry Kantor, states that the US is not in a recession. All over the media we hear pundits arguing about whether the economy can avoid a double-dip recession.
The other morning while driving to work I listened to a segment of the Davis-Emmer show on Twin Cities Talk Radio. Bob Davis cut his co-host off in mid-sentence when Tom Emmer was trying to make the case for the economy being in a serious downturn. Davis claimed the objective definition of a recession as created by the National Bureau of Economic research has not been met ( two negative quarters in a row for GDP). What is objective about a group developing a subjective measurement. Furthermore, the calculation for GDP (C+I+G+X) includes government spending. When the “G” spends at light speed, then it is hard for GDP not to grow. With real unemployment hovering in the mid-teens along with stagnating wealth and production, does not one of the media parrots consider the possibility that the “objective yardstick” is out of calibration.
In 2008, I warned about the historical characteristics of financial bubbles and depressions. After the initial crash, an economic aberration makes it appear like the full blown calamity has been averted when the house of cards is reshuffled. But the debt that caused the calamity has not disappeared; it has only switched hands. Debt cannot be resolved with more debt. Central banks and Treasury Departments can only delay the economic inevitable.
At this point in time, one can only hope for a recession, which is a vast improvement from where we are headed.
CNBC Idiocy
Posted by: | CommentsAt the beginning of every quarter, I tell my class that by the time the term is over they will know more about economics than 99.99% of the politicians, journalists, and at least half of those with Doctorate degrees in the subject. Additionally, I pose the hypothesis that a person not relying on the mainstream media for their information has a better understanding of economics and the world than a person who does.
Perhaps no greater source of misinformation exists than CNBC. Today the financial news network, a term I use loosely, provided two examples of journalistic stupidity or outright falsehoods. First echoing the recent blunt assessment by Texas Governor and Presidential contender Rick Perry, Rick Santelli ask New York Times journalist Thomas Friedman and Steve “I am an economic moron”, Liesman of CNBC whether Social Security is a Ponzi scheme. The following video displays not only the dishonest answer to the question but the unprofessional retort of a person caught in a lie.
Return to the Gold Standard?
Posted by: | CommentsCNBC Poll: Do You Support a Return to the Gold Standard?
Know When to Fold Them
Posted by: | CommentsOne of my great criticisms of the media dedicated toward financial news, like CNBC in particular, is that their stories usually sound like propaganda for the industry itself. The latest in shoddy journalism comes from a story covered by CNBC about a Fidelity Investments analysis that shows the gains stock investors would have made if they held on to their portfolios during the fall of stock prices in 2008 and early 2009. According to Fidelity, portfolios of players that held fast would be up 50%.
But this analysis says nothing about the original of purchase. As several noted in the comment section to the article, gamblers that bought and held over the last decade would have an unrealized loss of roughly negative 6%. Or heeding my own words in late 2006 and early 2007 printed on this blog about the impending doom, I sold my entire stock portfolio and began purchasing gold and silver and commodity exchange traded funds (ETF), which have appreciated handsomely.
An individual that bought stocks in 1929 and held tight would not fully recover until some 25 years later. The scenario today in comparison is much worse. I noted several years ago after the lows in the stock market were made in March of 2009 that financial bubbles follow a historic pattern of a crash, a sizeable rebound, and then a death spiral that ends up 80 to 90% from the highs. This would put the S&P 500 at a level between 300 and 400 or 700 points lower than it closed on Friday. The Dow Jones Industrial Average will face a similar fate bottoming out around 4000.
When people with a vested interest in keeping you in stocks provide phony analysis that says hold tight, then it may not be a bad idea to get ready and fold the cards.
http://www.cnbc.com/id/44204393
One of theDumbest Questions Ever
Posted by: | CommentsA story on CNBC today asks the question; Why Do People Cheat on Their Taxes? They might as well asked the question; Why Do People Hide Their Valuables?
The answer to both questions is obvious except to journalists and a law professor that shill for collectivism.
People actually want to keep what is rightfully theirs. Now that is a novel thought.
Representative Knudson On Budget Reform Bill
Posted by: | CommentsIt’s a financial issue. CNBC story.
Toche` Representative Knudson.
A Snow Job
Posted by: | CommentsWhite house economic advisor Larry Summers stated in an interview with CNBC that the recent blizzards probably distorted the unemployment numbers due to be released on Friday morning. According to Summers, the mountain of accumulated snow halted construction projects and also temporarily closed many stores plus restaurants.
The White House reasoning quickly melts in the face of economic logic. Businesses make hiring or firing decisions based on the benefit that an employee brings to the table versus their cost. No doubt the weather kept people from eating out or shopping for a few days. But the dress that was not bought on Saturday because of the weather more than likely will be purchased after the roads have been plowed. The lobster whose life was saved by little snowflakes on Friday night will be boiled a week later for a delayed celebration.
The fact is that construction has hemorrhaged jobs for over a year. In a report authored by the Bureau of Labor Statistics and released at the beginning of February, the construction industry shed another 75,000 jobs, which was about the average monthly loss for the preceding 12 months. Currently, one out of four unemployed people came from construction. Read More→
Oxymoron of the Decade
Posted by: | CommentsHesdline from a story on CNBC :Obama Calls Intelligence Meeting Over Failed Attack
John Mackey – An American Hero?
Posted by: | CommentsI think so.. As much as I detest the Christian News Channel, aka FoxNews (btw, I detest CNN, MSNBC, and CNBC more) they do occasionally have some excellent guest appearances. One such appearance recently was John Mackey. Oh, the scum bags tag on this one is in reference to some of the members of the audience, and a couple of the clips of protesters, and, especially, the final segment where Stossel brings in another guy (didn’t get his name but is clearly an unapologetic socialist)..
Shrinkage
Posted by: Henry Patrick | Comments (0)Admittedly, I am a cynic towards government data. Government is about power and money. Bureaucrats and politicians retain their ability to keep both by making us believe they can solve any problem. When you are the controlling the data, you make anything appear possible.
On Friday, the government released its statistics on employment for the month of January. According to the report, the economy created 243,000 jobs and the unemployment rate dropped another couple of notches to 8.3%. The President took a victory lap claiming that his policies have put Americans back to work. Stock market gamblers cheered the news by throwing more money into stocks resulting in hefty gains across all major indices.
Instead of celebrating, some analysts dug deeper into the data behind the joyous headlines. What they discovered as best described by CNBC commentator and free market advocate Rick Santelli was “shrinkage”. The labor participation rate has steadily decreased over the last few months to a January reading of 63%. The unemployment rate is calculated by dividing the number of people actively looking for work by the sum of the people working and those actively looking for employment. The unemployment rate can be magically lowered by narrowing the definition of actively looking for work. Individuals giving up in the search for a job or returning to school are no longer considered looking for a job. And neither is an individual working part-time due to perhaps a lack of full-time jobs. It does not appear to be logical for the labor participation rate dropping to a historic low point while the employment picture shows improvement.
Shrinkage
1.2 Million Gone
Tthe folks at www.zerohedge.com do a good job of investigating the numbers behind the government statistics. The following summarizes a few treasures buried in the employment data.
• The labor participation rate implies that 1,200,000 dropped out of the job market in the month of January
• Tax withholding data prior to Friday’s release indicated an addition of only 40,000 jobs instead of the 243,000
• The discrepancy could be the result of low paying and part time jobs accounting for a good portion of the 243,000 added to the payrolls
• The numbers reported by the Bureau of is not raw data. The numbers are massaged for seasonal adjustments and the birth-death ratio. In other words, the employment figures are mathematically cleansed
Employment Report Buried Treasures
Read More→