Booms, Busts, and Recoveries Message Board

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Strategies & Market Trends : Booms, Busts, and Recoveries

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From: Haim R. Branisteanu	12/30/2009 3:22:43 PM
	Read Replies (3) of 74559

The delusion of the masses; The criminal conduct of the major US financial institution brought about the recent economic hardship and at present they continue with the same delusion tactics in earnest. The release of the Chicago PMI is heralded as a sign of recovery when in fact it is more a sign of stabilization and mild uptick in economic activity. The PMI is a relative number and not an absolute indicator of manufacturing activity. As an example if until now XYZ corporation was experiencing negative order growth of let say over a year and it is now operating at 60% capacity in absolute terms to 2007 the mere fact that the PMI increased by 10 points does not indicate that XYZ is working overtime at full capacity!! All it means is that there is an uptick in orders from 60% to 66% of capacity and the orders can be filled with the existing workforce – and therefore the employment indicator is slightly over 50% - meaning they do not fire more people – but the other 40% of the employees that where fired since 2007 are still in most cases looking for a job or work part time. In a nutshell today PMI is not an indicator of recovery but only indicated that manufacturing stabilized at a very low level. I only wonder why the BO administration is letting this practice of delusion continue unabated when they promised a CHANGE !! – be ready for the January employment numbers next week whereby the BLS will come out with a similar distasteful hogwash, trying to induce even more delusion. Fact is that if indeed much more people where working, - then retail sales would not be so disappointing – the read from latest retail sales report is simple – people, do not buy because the are unemployed or fearful for their job and very few feels secure to splurge and buy. The way the financial and media outlets are engage in the delusion of the masses is outright hideous and disgusting

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