Sunday, October 17, 2010

The Feds Are Cooking the Economic Statistics Books

That is the premise underlying this article by Terrence Aym at and I'm not a bit surprised. Aym relates how John Williams of American Business Analytics & Research, LLC, publisher of Shadowstats, has analyzed the numbers on inflation, unemployment, money supply and several other key indicators of economic health, employing the same methods in use by the government up until 1994. His conclusion; we are in as bad shape as we were in the Great Depression. Real inflation is near 10%, not zero, and unemployment is actually closer to 23%, not the official 9.6%. And the dollar? It is worth about 50% of what it was in 1985 in terms of purchasing power. Finally, GDP growth is not the positive 2% to 3% being reported. In real terms it collapsed by 6% in 2009 and is running at negative 1% to 2% now.

If this is all true, then what the government is doing is truly criminal. This just contributes even more to the general economic uncertainty that is paralyzing the economy now. It is hard to see how this can get turned around when we can't even accurately assess the extent of the problems because we can't get good information.

Read the whole thing.

(h/t Jeff Smith)
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