Friday, February 25, 2011

Morning Update/ Market Thread 2/25 - Psyops Edition

Good Morning,

Equity futures are bouncing higher this morning. The dollar is higher after getting very close to long term support and note the usual correlation of dollar up/ stocks down is not happening so far. Bonds are higher too, oil and gold are up slightly, and most food commodities are higher following losses yesterday.

The first revision for Q4 GDP came out much weaker, falling from the previously contrived number of 3.2% to the still ridiculous 2.8% “growth.” This comes on expectations that it would be revised upwards to 3.4%. The weakness is in exactly the areas I pointed to when this report first came out – but let’s face it, this report is overstated by huge amounts – I’m guessing our actual GDP is 40% (or more) less than what we spin to the world. Keep in mind that as the quantity of money grows, the GDP APPEARS to grow, but that does not mean that we are actually producing more goods and services. Here’s Econoday spinning the party line:

The fourth quarter turned out to be not as strong as initially estimated. Fourth quarter GDP growth was revised down to 2.8 percent annualized growth from the advance estimate of 3.2 percent. The new figure fell short of analysts' forecast for 3.4 percent. However, the fourth quarter was still marginally healthier than the third quarter pace of 2.6 percent.

The downward revision to the percent change in real GDP primarily reflected an upward revision to imports (less negative) and downward revisions to state and local government spending and to personal consumption expenditures that were partly offset by an upward revision to exports.

Notably, demand numbers were revised down somewhat. Final sales of domestic product were bumped down to 6.7 percent from the initial estimate of 7.1 percent. Final sales to domestic purchasers (takes out net exports) were nudged down to 3.1 percent from the original estimate of 3.4 percent for the fourth quarter.

Separate from the direction of revisions, some components in absolute strength are relatively healthy. PCEs came in at an annualized 4.1 percent, compared to 2.4 percent in the third quarter. Nonresidential fixed investment gained 5.3 percent in the latest period, residential investment rose modestly, and net exports improved sharply. In contrast, inventory investment slowed significantly, slicing off 3.7 percentage points from GDP growth. And government purchases declined slightly.

Year-on-year, real GDP in the fourth quarter is up 2.7 percent, compared 3.2 percent in the third quarter.

On the inflation front, the GDP price index was little revised, coming in at 0.4 percent, compared to the initial estimate of 0.3 percent. The market median forecast was for 0.3 percent. However, the recent spike in oil prices makes the fourth quarter numbers basically irrelevant.

Today's report is a disappointment as equity futures eased a bit on the news though remained notably positive. The still moderate growth in the economy certainly explains currently sluggish growth in employment. But more recent monthly data show the recovery continuing, albeit at a moderate pace.

To me this report is just a flat out lie. It is disinformation on behalf of private banks. The disinformation in economics has become so extreme that it’s just embarrassing – fraud is everywhere you look. In the case of GDP, we let financial engineers create phony paper and debt, and we count that as today’s production. But the truth is that debt should be subtracted from GDP because it is an obligation, and “production” based upon it is borrowed from the future. Also, the GDP deflator vastly understates inflation which overstates productivity. And so the spin by manipulating this number leads people to believe that we are far more productive than we actually are.

And that makes the disinformation nothing more than a marketing tool to convince people to borrow and spend even more. The result is massive misallocation of resources. Phony GDP reporting is just one level of disinformation, it permeates all of our economy.

And we’ve become a terrific society at marketing – that is our real strength. Almost all new technology feeds marketing and visa versa – just look at Google, the world’s largest advertising company. That’s exactly what they are, they are not a technology company, all their revenues come from advertising.

But where, exactly, does marketing cross the line? I mean at some point marketing crosses over to influence people’s minds in ways that are not healthy for society, much less the individual being influenced. Every aspect of our society is now permeated with this false façade of marketing, even our social experiences.

The influence of greed and the pursuit of money has distorted our reality. My eye opening experience to the way the world really works was when I was in the Air Force. As a pilot I was ordered to take a series of six Anthrax vaccines. The story line was filled with blatant disinformation – “If you knew what we knew you’d willingly take it!” “Veterinarians have taken it for years.” “It’s safe, has limited side effects, and is FDA approved.” All lies. All marketing. But it was far worse than that in the real world, it definitely crossed the line into what the military calls “psyops.” That’s influencing the way people think by planting thoughts and ideas into their heads that are not true.

In the case of the Anthrax vaccine, it was all about the money too. A member of the Bin Laden family who lived in Europe bought the only manufacturer of Anthrax vaccine, Bioport, Inc. of Lansing, Michigan, and then gave former Chairman of the Joint Chiefsof Staff, Admiral Crowe, 11% of Bioport stock if he would go to the Pentagon and lobby to have the vaccine made mandatory for all military personnel, even the 90 pound pregnant female working the desk at McChord AFB.

This despite the fact that no person in any military in the history of the planet had ever been exposed to anthrax – ever. And much less in a weaponized form. The end result is that many people were injured from the shot. Many refused and legal battles ensued. I resigned over the issue without taking a single shot, thus forfeiting any retirement benefits, as did approximately 25% of my then reserve unit who could afford to. I felt very sorry for those who could not exit and were forced to take it against their will. And I felt very sorry for the collapse of morals and ethics of those who were dispensing the “Kool-Aid” like the military medical profession who should have known better yet went against their own Hippocratic Oath of doing no harm.

Then, once the program was challenged and it was learned that their propaganda was all lies, suddenly real anthrax began to circulate in the mail, killing several people, and even winding up on Senator’s desks. We still do not know who did this, but recently a lab worker “committed suicide” and the FBI is trying to pin it on him. I pin it on greed. This was a blatant attempt to legitimize the threat of anthrax so that Bioport would profit. That’s why the Senators were targeted. It is blatant, and it’s a for real conspiracy that’s still ongoing. It was psyops that turned onto outright terrorism.

That is my Air Force example of psyops, the spinning of reality to achieve a money related goal.

And that’s why I’m not surprised to learn this:

Another Runaway General: Army Deploys Psy-Ops on U.S. Senators

The U.S. Army illegally ordered a team of soldiers specializing in "psychological operations" to manipulate visiting American senators into providing more troops and funding for the war, Rolling Stone has learned – and when an officer tried to stop the operation, he was railroaded by military investigators.

Psyops used against politicians to get money? Taxpayer paid employees using psyops to get more money, more employees. Think about that.

And I think back to my young days as a new pilot knowing how illogical "use it or lose it" budgeting was. Ordered to do so despite objections, I flew hours and hours in empty airplanes using it, all quit unnecessarily.

And we wonder why we spend more on defense than the rest of the entire world combined. And we wonder how it is that we are a bankrupt nation.

We are a broken nation. We have crossed the line between marketing and psyops – way crossed the line. The GDP report is the same exact thing. As are most of the economic reports I see day in and day out. They are not real. They are designed to separate you from your money.

And the psyops has an impact. “Consumer” Sentiment just came out higher to go along with the inflated supply of money – 77.5, up from 75.1. Still depression era levels, but come on… come join the party everything is “growing!”

Well, except for things that exist in reality, like new homes. Where just yesterday it was reported that New Home Sales fell to only 284,000, one of the lowest numbers in modern history, and well below the previous month and expectations as well. That’s because expectations are based on psyops, homes exist in reality.