Tuesday, January 3, 2012
When economic growth really isn't
What a bunch of (fill in the cuss word)!!
Thought it would be fun to briefly show how corporate media report such nonsense and where truth is actually buried in a story..
We start with the headline from AP:
Factories, builders boost economy at end of year -- "Factories hired more workers in December, saw the most growth in new orders since April and ramped up production. U.S. builders spent more in November on single-family homes, apartments and remodeling projects. The strong reports correspond with other positive signs for the economy. Consumer confidence is up, unemployment benefit applications have tumbled and the unemployment rate is at a three-and-a-half-year low."
Ahh.. Goebbels himself couldn't have written a rosier prognostication.
Just Wonderful... right?
After a lot of fluff quotes, in paragraph 15, the article says, "Construction spending rose 1.2 percent in November to a seasonally adjusted annual rate of $807.1 billion. "
OK.. now, here's the next sentence... "That's barely half the $1.5 trillion that economists consider healthy"
The market went up based on statistical data that represents less than 50% of what Healthy construction spending would be.. (fill in cuss word) Amazing.
Now paragraph 16: "Spending jumped 9.5 percent on home improvement projects in November. It rose 1.5 percent on single-family home construction and gained 1.3 percent on apartment building... "Spending on single-family construction still remains extremely depressed..." said Daniel Silver, an economist with JPMorgan Chase."
And why do people make home improvements? Either out of necessity, to try to create uniqueness to entice buyers when the home is unable to sell as-is, or more and more people realize they have No Chance of getting approved for a mortgage on a new home so they better enjoy and fix up the home they got.
From paragraph 18: " "It is hard to see the U.S. economy strengthening this year when the euro-zone is on the cusp of a potentially severe recession and when growth in Asia is set to slow," said Paul Dales, an economist at Capital Economics."
Notice how the truth is buried at the bottom of the article and all the rosy optimistic cheer froths up at the top where the news skimmers can find it?
And the market went up based on it.