posted on Jul, 10 2009 @ 01:44 AM
When all governments decided to abandon the gold standard due to more practical expansion of money supply that would encourage dynamic investment, the
economists were taken to the task to devise a set of indicators that would measure how the economy is performing and whether it needs more money or
less money to keep realistically performing.
But the governments have taken advantage of the new system of creating money supply mainly through excessive borrowing and the result was a
destabilization of the economy where cyclical deviations were gaining amplitude heading toward boom and bust cycles. The amplitude and the frequency
of these economic oscillations is a direct result of the effort to patch the economy by other means than fiscal restraint, which could lead to changes
in the basic rules according to which goods and services are exchanged. A sign of “socialization” of the economy has been already observed.
Since the principles of the capital investment hasn’t gone through dramatic changes, an economic outlook is essential in making a decision when and
where to invest; the increasing rate of investment creates business opportunities and assures a healthy economy. In order to usher this conditions,
the US government decided to falsify the economic outlook to fool the investors into action, as the following economic outlook clearly indicates.
The red curve of the predicted growth sets 2009 as the bottom of the economic downturn. Then the curve steeply rises in violation of the way it
arrived at the bottom. This is not an optimistic outlook; this is a fraudulent manipulation of the parameters that draw the business cycle curves. The
truthful, realistic projection is given by the green curve bellow.
The acceptance of the red, fraudulent curve as a reliable outlook would prompt an investor to make a move in the wrong time and lose a good portion of
his investment. For those “too big to fail,” the option to ask the taxpayers for help to offset the losses would be the only solution. Are we for
another round of big-time bailouts?
The government took a big gamble to woo investors into acting in order to get the economy out of the hospital. If this gamble fails, the consequences
would turn really severe.
By manipulating the economic indicators, the US agency responsible for such an act further eroded the trust of the people in the government. I always
regarded the idea that we never landed on the moon as a result of mental impairment on the part of those individuals responsible for such a claim. But
now, looking at the doctored economic projection, I’m not that convinced that the moon landing wasn’t a hoax.
At least the guys at NASA are honest enough to predict another economic downturn around 2013.