1.) GOVERNMENT REPORTS ON THE WALL STREET STRESS TESTS WHILE IGNORING $5.4 TRILLION IN OFF-BALANCE-SHEET ASSETS STILL UNREPORTED BY 19 TESTED BANKS.
CHECK.
On Thursday, May 7th, we received the results of the so-called Wall Steet Stress Tests: 10 of the 19 banks tested are required to obtain approximately $75 billion in additional capital over the next six months. Funny thing that since, just four weeks ago, Treasury Secretary Geithner was reportedly on the verge of asking Congress for another $300 to $500 billion in bailout funding for the exact same purpose. Nouriel Roubini and the International Monetary Fund ("IMF") say the real amount(s) are still trillions shy of concluding this mess in: "We Can't Subsidize the Banks Forever."
2.) GOVERNMENT CONTINUES TO OBFUSCATE ACTUAL UNEMPLOYMENT REALITIES.
CHECK.
On Friday, May 8th, the US Labor Department's Bureau of Labor Statistics ("BLS") presented quite dubious (I'm being quite kind here, frankly they were nothing short of misleading, IMHO) unemployment numbers to the public.
3.) GOVERNMENT, WHILE OBFUSCATING UNEMPLOYMENT STATISTICS, IGNORES HISTORICAL FACTS WHICH CONTRADICT THEIR LASTEST UNEMPLOYMENT REPORT.
CHECK.
Over the weekend, we learned that the government hadn't reported an improvement in the employment picture, comparing the March results to those in April, in 29 years--since 1980. But, somehow--in the midst of the worst economy since the Depression and the worst unemployment cycle since the end of World War II--miraculously, we're supposed to believe that in April, 2009, for only the second time in 29 years, unemployment actually declined at a slightly slower rate than it had for the previous six months?
4.) LEADING MANAGER'S OF OUR NATION'S ECONOMY CONTRADICT ONE ANOTHER.
CHECK.
Now, today, Monday, May 11th, the Chairwoman of President Obama's Council of Economic Advisors, Christina Romer, is telling us: "Obama Adviser Sees Unemployment Rising Until 2010."
Ms. Romer may not have realized it, but as a byproduct of making these statements, she has just told us:
a.) the Stress Tests were useless--"worst-case scenario" unemployment statistics used in the test don't even come close to the realities we're going to face in 2009 as Ms. Romer now projects herself--and most of the banks' government-mandated, additional capital requirements will be insufficient to see Wall Street through the tough times ahead as a result, so they'll require significantly more government financial support than the $75+/- billion that was mandated by Treasury Secretary Tim Geithner just last week, and,
b.) the Recession will not be over until sometime in 2010, at best; despite her (and others such as Geithner and Bernanke) apparent comments and assurances to the contrary concerning an upswing in our G.D.P. by year's end, and in an effort to ameliorate her pronouncements today, because she's simultaneously ignoring a reality established by the National Bureau of Economic Research that--despite popular belief otherwise--has specifically stated in year's past that unemployment is not a "lagging indicator" of recovery from a recession, but is, in fact, a leading indicator of the onset (and continuation) of it. This is especially interesting when you read Ms. Romer's Wikipedia bio:
...Professor Romer is co-director of the Program in Monetary Economics at the National Bureau of Economic Research,[13] and was a member of the NBER Business Cycle Dating Committee until she resigned from this position on November 25, 2008.[14]...
And, the reason Ms. Romer's words about things 'improving' by year end--despite unemployment continuing to sink until 'sometime in 2010'--are interesting is due to this comment and observation from Shadow Stats Publisher John Williams on May 4th, which clearly contradicts Ms. Romer's knowledge of this matter due to her very close association with the National Bureau of Economic Research:
Employment Conditions Remain Dismal. Contrary to some recent stories in the popular press, employment is a coincident indicator of broad economic activity, not a lagging indicator. As such it is used by the Conference Board as one of its coincident indicators in the series of leading, coincident and lagging economic indicators taken over from federal government reporting, some years back. The National Bureau of Economic Research (NBER) -- official arbiter of U.S. recessions -- also uses payroll employment as one element in setting the precise timing of the onset of a recession. Perversely, however, the NBER ignored ongoing employment contractions in order to call early ends to the 1990/1991 and 2001 recessions, and such may have become the basis for citing employment as a lagging indicator.
(NOTE: Mr. Williams' Flash Updates are available by paid subscription, only, therefore I cannot provide a link to the above paragraph.)
Here's the link to the Christine Romer story, running in today's (Monday's) NY Times: "Obama Adviser Sees Unemployment Rising Until 2010."
Obama Adviser Sees Unemployment Rising Until 2010
By JOSHUA BRUSTEIN
Published: May 10, 2009
President Obama's chief economics forecaster said on Sunday that the nation's unemployment rate was likely to keep rising until 2010, even if the economy begins growing later this year.
--SNIP--
Speaking on C-SPAN, Christina Romer, chairwoman of the White House Council of Economic Advisers, said that she expected the economy to begin growing in the fourth quarter of this year. Ben S. Bernanke, the Federal Reserve chairman, made a similar prediction last week.
But Ms. Romer also said that she expected unemployment to rise even after the economy turns, saying that gross domestic product has to grow at a rate of about 2.5 percent before unemployment will fall. Before that happens, she said, it is "unfortunately pretty realistic" that the unemployment rate could reach 9.5 percent. It was reasonable to estimate that the G.D.P.'s growth rate in 2010 would be 3 percent, she said.
--SNIP--
But the "big dollars," she said, would come from fundamental changes in the health care system.
"When you actually look at that budget going out in time, the thing that is going to bankrupt us is government expenditures on health care," she said.
Lastly, this tie-in with healthcare expenditures, which is spot-on, in terms of its assessment, dovetails with another piece in today's NY Times: "Industry Pledges to Control Health Care Costs Voluntarily."
Industry Pledges to Control Health Care Costs Voluntarily
By ROBERT PEAR
Published: May 10, 2009
WASHINGTON -- Doctors, hospitals, drug makers and insurance companies will join President Obama on Monday in announcing their commitment to a sharp reduction in the growth of national health spending, White House officials said Sunday.
The officials said the plan could save $2,500 a year for a family of four in the fifth year and a total of $2 trillion for the nation over 10 years. That could make it less expensive for Congress to enact comprehensive health insurance coverage, a daunting challenge facing the Obama administration.
At this point, administration officials said, they do not have a way to enforce the commitment, other than by publicizing the performance of health care providers to hold them accountable.
By offering to hold down costs voluntarily, providers said, they hope to stave off new government price constraints that might be imposed by Congress or a National Health Board of the kind favored by many Democrats.
Voluntarily?
They "...hope to stave off new government price constraints that might be imposed by Congress or a National Health Board of the kind favored by many Democrats."
Democrats? Isn't that the party that is in control of our government right now?
Quick Mr. President, do something! Have a press conference! Talk about how great this initiative is. I mean, we can't have the party in control actually calling the shots!
If we did that, it'd mean that we'd have to focus on Main Street instead of Wall Street when it came to allocating our national bailout expenditures! And, we'd have to actually follow Congress' lead and/or a National Health Board's lead when it came to setting the agenda for a national healthcare intiative!