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Thursday, March 17, 2011

When 'recovery' propaganda becomes Insulting

~ A real $10,000 bill - Salmon B. Chase: Treasury Sec. under Lincoln

Today the stock market rose based on this--

Stronger economic reports help stocks rebound (AP) -- Signs that the U.S. economy is improving helped investors put aside fears over Japan's nuclear crisis Thursday... A gauge of manufacturing in the mid-Atlantic region jumped in February...new orders soared... The Labor Department reported that the number of people applying for unemployment benefits fell more than economists expected last week. Ongoing claims dropped to the lowest level since October 2008."

" "It's a reminder that the U.S. economy continues to gain momentum," said Alan Gayle, senior investment strategist at RidgeWorth Investments in Richmond, Va. "Economic growth leads to more spending, more production and ultimately rising profits," he said. "And at the end of the day, that's what investors buy: rising profits." "

~ "The economy gaining momentum.. Oh, Reeeealllyy?"

For 'fun' I keyworded the term 'spikes' on Google news search.  I wasn't looking for railroad spikes or people named 'Spike'.  No- I meant price 'spikes', so I was curious if the word was used in any recent economic stories...  this is what I found:

Spikes in food, oil costs boost wholesale prices (AP)  3/17 -- "Higher energy costs and the steepest rise in food prices in nearly four decades drove wholesale prices up last month by the most in nearly two years... The Producer Price Index rose a seasonally adjusted 1.6 percent in February, the Labor Department said Wednesday. That's double the rise from the previous month... Food prices soared 3.9 percent last month, the biggest gain since November 1974."

Oil price spikes on Bahrain unrest (Telegraph.co.uk) 3/16 -- "Brent crude jumped on Wednesday after Bahrain security forces attempted to clear protesters, raising tensions between Sunni and Shi'ite Muslims in the oil rich region."

Retail's biggest losers during oil spikes (CNN-Money) 3/14 -- "An oil spike has a way of making market watchers nervous, and retail investors are no exception... Surging gas prices have cast a pall over the sector, which is up just 0.7% so far this year... Every $1 increase in the price of a gallon of gas lowers consumer spending by $100 billion, according to Deutsche Bank analyst Mike Baker. If gas prices were to stay at $3.47 through the rest of 2011, resulting in a yearlong average of $3.41 -- a $0.67 increase from 2010 -- consumer spending would decline by $67 billion."

~ "Gee this doesn't seem too positive?  Hmm.. Still, I better keep Buying"

As fuel spikes, so goes airfare (CNN-Money)  3/17 -- "The reality is that the price of fuel isn't as big of an influence on fares as you might think. It's more of a scapegoat, and it's one that's not used well. In most cases, airlines simply increase fares because they can."

Component shortages, price spikes to follow quake (EE Times-Asia) 3/17 -- "HS iSuppli has warned that the powerful earthquake that hit northeast Japan on March 11 could trigger shortages of key electronic components and materials, as well as price increases for these devices. ''Components impacted will include NAND flash memory, DRAM, MCUs, standard logic, LCD panels, and LCD parts and materials,'' according to IHS iSuppli"   * That's PCs, iPads, HDTVs, etc...

Number of homeowners underwater spikes (AP) 3/9 -- "The number of Americans who owe more on their mortgages than their homes are worth rose at the end of last year... CoreLogic said Tuesday that about 11.1 million households, or 23.1 percent of All mortgaged homes, were underwater in the October-December quarter. That's up from 22.5 percent, or 10.8 million households, in the July-September quarter."

Trader 1:  I got Five!
Trader 2:  He's got Five..  Five fingers!  Give it up for the Man!

~  Its interesting--  I couldn't find Any recent news story that mentioned spikes in job hiring or rise in wages to meet up with the increased living costs. Couldn't find anything that mentioned spikes in home property values or increased buyers looking for a home.  Nothing on spikes in domestic manufacturing. Nor did I find any spikes in consumer confidence or belief in the government to fix the economy any time soon.

Just found a lot of negative economic reality- and one more piece of 'recovery' bullshit for traders to rationalize as the reason for investing today.

And lastly, if you're hoping the Federal Reserve will do something to keep this rising prices in line...

"Despite the slightly above expectations rise in January (in wholesale prices rising), the consumer inflation report tended to support the Fed's views that inflation remains too low." (Business Spectator) 2/18/11

Two Americas folks...

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