Government Statistics: The Emperor's New Clothes

How can government statistics keep showing improvements while the real economy keeps getting worse? US GDP apparently rose 5.7% in the last quarter of 2009 after a 2.2% rise in the third quarter. Quite astonishing considering that the number of people employed also dropped by 1.2 million. What the general public now have to grasp is that GDP is a very bad measure of the health of the economy. Indeed, in general, every social statistic is only useful until someone figures out a way to manipulate it. In the case of GDP, this statistic does not distinguish between productive and unproductive spending - it lumps together commercial activity and government spending. The recent rises are therefore just the manifestations of government spending such as the bailouts and the stimulus package. It is rather like a person dipping into their savings to finance their lifestyle and claiming that as extra income rather than as an expense.

The corporate media also like to point at the recovery on Wall St as a sign that things are improving. Firstly, the Dow is full of multinationals so has little to do with the health of just the USA - all of the Dow companies are in various global indices, such as the FTSE Multinationals. Secondly, the looting of public money by Wall St banksters continues with the population seemingly impotent to react en masse. I'd wager that European countries will see much more social unrest than the USA. The manipulation of the stock markets has been amply recorded. The pump and dump strategies that have led to two major bubbles and hundreds of short term bouts of effervescence are ways for Wall St insiders to try to claw back money they have lost. Investors should just look at the numbers and either ignore the news totally or assume it is just part of the entertainment industry.

The solution, according to EIR is to call the bankers' bluff, close down the Fed and show the world that the emperor indeed has no clothes. As the article says, this is the scenario that haunts the banksters and this is why so much government spending is going into the military and police so that the oligarchs can protect themselves if the people ever summoned the guts to start another revolution. I suspect a miraculous solution will be presented to the public just as the sound of gunfire starts to fill the air. A new world order with a new world bank, a new world currency and a new warm cell.

The Emperor's New Statistics by EIR.