Slowly but surely, the confident assurances of a fantabulous second quarter for the U.S. economy — one which is supposed to make the serious first-quarter contraction reported on Wednesday a distant memory — are crumbling.
Yesterday at the Associated Press, Martin Crutsinger, who just a couple of weeks ago had been relaying confident second-quarter predictions of annualized 3.5 percent and even 4 percent growth, quoted a still-optimistic economist who, in Crutsinger's words, "said strength in other areas (besides yesterday's weak consumer spending report — Ed.) should still lift economic growth to around a 3 percent annual rate in the current quarter." Today, in covering the University of Michigan's consumer confidence report, Christopher Rugaber, Crutsinger's dynamic duo buddy at the AP, brought the growth figure down to a level which won't even offset the dreadful first quarter:
On Thursday’s Today, NBC host Matt Lauer walked into trouble with the feminists by asking GM CEO Mary Barra if she could be a mother and a CEO and do both jobs well – causing every liberal to pull out the card “You don’t ask the males that.”
Charlotte Alter at Timeasked: “How’s this for a question: Can Matt Lauer be a good dad and host the Today Show? Let’s discuss.” (Video below)
My, those "this quarter's really, really going to be great" predictions can disappear so quickly these days.
Yesterday, in the wake of the government's third revision to gross domestic product showing that the economy shrunk by an annualized 2.9 percent during the first quarter instead of the previously reported 1.0 percent, commentators, analysts, and economists fell all over themselves insisting that the second quarter and the rest of the year will be fine. The reaction at Goldman Sachs was — get this — to raise their estimate for second-quarter growth from an annualized 3.8 percent to 4.0 percent. Today, in the wake of a particularly weak consumer spending report for May, the backpedaling — well, partial backpedaling — is under way, particularly at the Associated Press (bolds are mine):
The press, even in the wake of yesterday's awful reported 2.9 percent annualized first-quarter contraction, continues to regale us with noise about the economy's "recovery" during the past five years.
As P.J. Gladnick at NewsBusters noted yesterday, CNNMoney.com's Annalyn Kurtz, in giving readers "3 reasons not to freak out about -2.9% GDP," concluded her report by telling readers that "This recovery is underway, but it's choppy and still very slow." Actually, it may have resumed this quarter. At the Associated Press yesterday, Martin Crutsinger all too predictably wrote that"the setback is widely thought to be temporary, with growth rebounding solidly since spring." After almost five years of this nonsense, it's long past time that they start telling readers, listeners, and viewers that this economy bears more resemblance to the 1930s economy under Franklin Delano Roosevelt than it does any post-downturn economy we've seen since the end of World War II. Hard proof follows the jump.
Hooray! The Gross Domestic Product shrank by 2.9% in the first quarter of the year. "This recovery is underway."
Your humble correspondent was very careful to put the previous sentence in quotes because I don't want you to think I've taken leave of my senses. This amazing conclusion comes to us courtesy of CNN Money spinmeister Annalyn Kurtz who starts out on a rather gloomy note but manages to spin her way into economic joy:
Sounding a familiar theme at the Associated Press ahead of awful economic news, Christopher Rugaber and Martin Crutsinger prepared a column in advance of tomorrow's final report on the economy's first-quarter economic contraction reminding us, with far more certainy than is justified, that "A GRIM US ECONOMIC PICTURE IS BRIGHTENING."
Guys, before you "brighten," you first have to step out of the darkness. According to the wire service's dynamic duo of reporting on the economy (I guess I could add Josh Boak and call them "the three amigos"), tomorrow's report on the nation's first-quarter Gross Domestic Product is expected to show that it contracted by "nearly 2 percent" on an annual basis. AP reports a week ago didn't include "nearly." Bloomberg News is currently predicting a contraction of 1.8 percent. I'd like to be wrong, but I'm concerned that it might be significantly worse. But Rugaber and Crutsinger say, "Don't worry, be happy; the rest of the year will probably be fine" (bolds and numbered tags are mine):
In a Thursday New York Times op-ed, columnist Timothy Egan, who previously "worked for 18 years as a writer" at the Times, went after Wal-Mart as "net drain on taxpayers, forcing employees into public assistance with its poverty-wage structure." In his view, working at Wal-Mart and receiving its "humiliating wages ... certainly keeps you poor."
At the company's blog, David Tovar, Walmart's vice president for corporate communications, armed with a photocopy of Egan's op-ed and a red pen, ripped Egan's contentions to shreds (portion presented was reformatted to fit the available space; HT Instapundit):
Some readers here may have a tough time discerning why the economy's mediocre to stagnant performance isn't fully registering with the general public, which feels that things aren't going too well but still doesn't how weak the situation really is. The obvious answer is that the press overemphasizes any good news which appears and downplays marginal or bad news — while occasionally, as seen last night in Bloomberg's coverage of yesterday's largely miserable homebuilding statistics, pretending that bad news really was good.
Perfect examples of this problem came in two CNNMoney.com emails I received this afternoon. The emails has news which could be considered news, while leaving out some clearly bad news which delegitimizes their email's optimism:
There must have been a double delivery of Obama administration koolaid over at Bloomberg News this morning.
The business wire service, which ordinarily is slightly less imbalanced in its business and economics reporting than the Associated Press, somehow interpreted a 6.5 percent seasonally adjusted decline in housing starts during May and a nearly identical percentage drop in building permits — with both figures lower than May 2013 — as evidence that "the homebuilding industry stabilized after a first-quarter swoon." That's ridiculous. The first quarter was supposedly as bad as it was because of bad winter weather; so there should have been an overcompensating bounceback. It hasn't happened. Meanwhile, that second Bloomberg koolaid delivery must have been the one meant for AP, whose Josh Boak turned in a report noteworthy for its unusual sobriety (bolds are mine throughout this post):
You've got to hand it to Martin Crutsinger at the Associated Press. His Thursday writeup on May's disappointing retail sales result — a 0.3 percent increase compared to expectations of 0.4 percent to 0.6 percent — was infused with optimism. It's "unlikely to derail overall economic growth." There's been a "revival in consumer spending." We'll see "boosting incomes and supporting stronger consumer spending" as a result of more hiring."
But along the way, Crutsinger quietly downgraded his estimate of second-quarter and full-year economic growth. Just a few weeks ago, AP reports were predicting that the second quarter might come in at an annualized 4 percent, and that 2014 on the whole would surely come in at 3 percent or greater, even after the first quarter's annualized 1.0 percent contraction. Let's see how Crutsinger stealthily reported a far lower estimate after the jump (bolds and numbered tags are mine):
UPDATE [06/16]: Monday's Today offered a correction on Trump's claim that Blair Kamin had been "fired" from the Chicago Tribune. At the top of the 8 a.m. ET hour, news anchor Natalie Morales explained: "Well, in fact, that critic, Pulitzer Prize winner Blair Kamin, has been with the Chicago Tribune for more than twenty years and also spent the 2013 academic year as a Nieman Fellow at Harvard." See a transcript of the June 16 news brief below.
On Friday, NBC's Today and CBS This Morning touted Chicago Tribune architecture critic Blair Kamin hurling insults at Donald Trump's newest skyscraper in the Windy City, condemning the "brashness" and "egotistical overstatement" of the billionaire's decision to place his name on the building, even calling it a "wart" on the city skyline and comparing it to "Godzilla." [Listen to the audio or watch the video after the jump]
Reacting to the melodramatic declarations during a live phone interview on Today, Trump slammed Kamin: "This was started by a third-rate architectural critic for the Chicago Tribune, who I thought got fired. He was gone for a long period of time. Most people thought he got fired. All of a sudden he re-emerges, and to get a little publicity, he started this campaign."
On Tuesday, the Associated Press carried a regional story about the status of North Dakota's planting season. Readers will be pleased to know that 93 percent, 78 percent, and 92 percent of the state's wheat, potato and corn crops have been planted.
Of course, farm news is important in the Roughrider State. But so is the latest information on its stratospheric economic growth, as well as looking at last year's growth in the nation's other 49 states and DC as reported by the government's Bureau of Economic Analysis yesterday. But I could not locate a national AP story on state-by-state gross domestic product growth, and there have been almost no national-scope stories anywhere else. Perhaps that's because the country's top performers are predominantly deep-red states, while its significant laggards, at least based on who they supported for president in 2008 and 2012, are mostly blue.
At the Associated Press yesterday, Christopher Rugaber's writeup on the latest economic growth projections of the National Association of Business Economists (NABE) contained several glaring weaknesses.
Take the headline (quite possibly not his doing) and his opening sentence. The headline, "SURVEY: GROWTH TO PICK UP, HIRING STEADY," seems designed to ensure that those who only look at headlines in print or on their online devices will remain blissfully ignorant about the economy's first-quarter contraction. The fact is that following a quarter of shrinkage, economic growth first has to "return" or "resume" before it can "pick up."
After investing so much emotional energy in the idea that the weather-impaired contracting U.S. economy of the first quarter is going to give way to a super-duper awesome second quarter and strong rest of the year, it was foolish to think that Martin Crutsinger at the Associated Press, aka the Administration's Press, would backtrack after just one contradictory report on consumer spending, which "unexpectedly" fell 0.1 percent in April, confounding expectations of a 0.2 percent pickup.
And of course he didn't. What's remarkable is that Crutsinger's Friday report seemed to get even more aggressive with his second-quarter prediction, citing "some analysts" who believe that it will come in at an annualized 4 percent — quite the reversal from the first quarter's 1.0 percent annualized contraction. Meanwhile, the AP reporter missed a less buoyant report from his colleague Christopher Rugaber which punctured a bit of Crutsinger's premise. Excerpts from both items follow the jump.
In an apparent attempt to reach those who usually don't pay much attention to the economy, USA Today sent out a tweet Thursday afternoon in the wake of the government's report earlier in the day that the U.S. economy contracted by an annualized 1.0 percent — on its weather feed.
The tweet (HT Zero Hedge), plus evidence that the economy has somehow managed to "weather" previous cold and stormy winters, follow the jump:
In July 2013, the Associated Press's Christopher Rugaber finally noticed the meteoric rise in the number of temporary help service and other non-payroll personnel working at U.S. employers — a trend which at the time was about 2-1/2 years old. Rugaber noted that "temps and to a much larger universe of freelancers, contract workers and consultants ... number nearly 17 million people who have only tenuous ties to the companies that pay them – about 12 percent of everyone with a job." He also cited two likely contributors to that growth. First, "Some employers have also sought to sidestep the new health care law’s rule that they provide medical coverage for permanent workers. Second, "companies want to avoid having too many employees during a downturn."
This morning, the AP's Tom Raum did another report on the situation, and proceeded to blow the numbers, ignore Obamacare, and downplay the influence of the mediocre economy.
Last night (at NewsBusters; at BizzyBlog), I pointed to the track record of Dean Baquet, who has ascended to the hallowed perch of executive editor at the New York Times, and observed that "someone who has clearly been a troubling and disruptive presence is now in charge."
Two incidents spanning seven years support my contention. The first occurred in 2006 at the Los Angeles Times, where Baquet, then that paper's editor, petulantly refused to make budget cuts the paper's Tribune Company parent demanded, took his complaints public in the paper itself, metaphorically barricaded himself in his office, and dared the Trib to fire him (they did, two months later). The second occurred in April of last year, when Baquet, now at the New York Times, got into an argument with now deposed Executive Editor Jill Abramson, "burst out of Abramson’s office, slammed his hand against a wall ... stormed out of the newsroom ... (and was) gone for the rest of the day." Now we learn from David Carr at the Old Gray Lady itself that, in essence, Baquet did an "it's her or me" number on Abramson (HT Ann Althouse) to grease the skids for her firing.
The season finale of The Good Wife will air tonight (Sunday) on CBS. Last week’s episode included a quick pot-shot, from lead character “Alicia Florrick” played by Julianna Margulies, at legendary libertarian author Ayn Rand.
She declared Rand’s books are “awful,” snidely asserting: “A guy bombs a building, the rich go out on strike. It’s a 12-year-old’s view of the world. It’s like basing your philosophy on the books of John Grisham.”
A search at 11:00 p.m. ET tonight at the Associated Press's national web site on "Serco," the company with a five-year, $1.25 billion contract to process paper Obamacare enrollment applications, returned no results. That's absolutely pathetic, given that St. Louis TV station KMOV, based on multiple accounts from several current and former employees and contractors, has reported that the company has well over 1,000 people doing almost nothing all day simply because there are very few paper applications to process. KMOV, which carried five consecutive reports this week (here, here, here, here, and here), even noted in its later segments that its work had drawn national attention.
What's worse than AP not covering the story nationally? How about the wire service treating it as a local and regional story, even though Serco and the Centers for Medicare and Medicaid Services are wasting roughly $20 million per month of U.S. taxpayers' money, and even though calls for investigation have come from U.S. senators in at least two states? It would have been just as absurd if AP had treated bankrupt Solyndra, which failed to repay an Energy Department loan of over $500 million several years ago, as a California-only story because that's where its plant was. Excerpts from the AP's story, including a "This story is boring, so don't read it" headline, follow the jump (bolds are mine):
The Jill Abramson firing continues to gain wide attention in media circles. Buzzfeed released an exclusive story linking it to a 96-page internal memo about innovation. That memo showed the Times willing to consult with at least 354 people inside and outside the organization.
Along with one highly unusual choice – actor/model Fabio. Fabio, that’s right, Fabio. The Italian actor known to many for his “I Can’t Believe It’s Not Butter” commercials in the 1990s is nestled in the midst of some of the top names in journalism.
Is “The Gray Lady” that way because the sexist owners of The New York Times won’t pay her enough for a proper dye job? This and other delightfully schadenfreude-alicious questions are worth pondering now that the paper has “unexpectedly” fired executive editor Jill Abramson on May 14.
Abramson stepped into that role on September 2011, becoming the first female executive edtior at the Times, according to AdWeek. And according to several reports at least part of the reason was because she made a fuss about being paid less than her predecessor.
It looks like the "weather" excuse the press went to repeatedly to explain weak economic results in December, and January, and February, and March still has life in April. But this time, warm weather (which most of us would find "good," at least in April) is to blame. An early afternoon report (relevant portion saved here in graphic form) on the Dow's 200-point mid-day dip by the Associated Press's Ken Sweet claims that April's reported decline in industrial production was "possibly due to more bad weather" (while this post was prepared, the AP issued a 2:17 p.m. update which still had the "bad weather" excuse.)
That "bad weather" line is odd, because an earlier AP dispatch by Paul Wiseman exclusively about today's production release from the Federal Reserve didn't mention or allude to the weather at all. After the jump, I'll walk readers through Sweet's possible "warm weather was really bad weather (for the economy)" logic and critique Wiseman's longer coverage.
In early May, after the government announced that first-quarter gross domestic product growth came in at a barely perceptible annual rate of 0.1 percent — the equivalent of a business which grossed $100,000 in the previous quarter seeing its sales rise by $25 — reporters at the "essential global news network" were regaling readers with an air of assuredness that the rest of the year would be different. Specifically (both here and here), the wire service carried predictions that the economy would turn in annualized second-quarter growth of 3.5 percent, and that the entire year would end up at 3.0 percent. As seen after the jump, put a big "oops" on those figures (bolds are mine):
AP's tallest tale is in ascribing the four annual deficits of over $1 trillion incurred from fiscal 2009 through 2012 entirely to the "deep recession" and the need to "stabilize the financial system," when the truth is that huge increases in government spending not related to those matters are primarily what shot the annual deficits upward — and are still keeping them at historical highs. Excerpts follow the jump (bolds and numbered tags are mine):
If I didn't know any better, I might have thought, based on an Associated Press report tonight by business writer Bernard Condon prepared with the help of four others, that governments everywhere had reinstituted child labor for those as young as six years old.
That's the only way to support the claims Condon made about how the birth dearth in the developed world driven by the 2008 financial crisis is responsible for the current worldwide economic malaise. This desperate grasping at straws is apparently necessarily because the press will never blame the ineffectiveness of Keynesian fiscal policies and national banks' interventions in the developed world's economies, which are really the culprits. Excerpts from Condon's calamity follow the jump (bolds are mine):
In stark contrast to the celebratory "AMERICAN ECONOMY BOUNCES BACK FROM BRUTAL WINTER" headline Friday afternoon at the Associated Press, aka the Administration's Press, Ben White's "Morning Money" report at the Politico is notably concerned about whether Friday's "vexing jobs report" justifies the kind of optimism the AP conveyed with seeming finality in its headline.
To be fair, the underlying AP report by Chris Rugaber and Josh Boak pointed to several weaknesses in the jobs report. But to be appropriately critical, as I noted yesterday, they took it as a virtual given that the economy will turn in full-year growth of "nearly 3 percent." Achieving that result will require second-half annualized growth of nearly 4 percent — a level would likely cause the Federal Reserve to put on the brakes by raising interest rates to stave off inflation. In a separate post, I also criticized the AP pair for presenting economists's estimates of 3.5 percent annualized growth in the second quarter without telling readers that their prediction is premised on the first quarter's current 0.1 percent result getting revised downward into contraction.
This morning (at NewsBusters; at BizzyBlog), I noted that Friday afternoon's coverage of the government's jobs report at the Associated Press by economics writers Christopher Rugaber and Josh Boak carried predictions of "nearly 3 percent" economic growth this year. Those predictions ignore how difficult achieving that will be after the first quarter's miserable 0.1 percent annualized result and "most economists'" estimates that the second quarter will come in at 3.5 percent. Those two results require average annualized growth of 3.9 percent during the third and fourth quarters — something the economy hasn't seen in ten years. Additionally, it appears that if the Federal Reserve under Janet Yellen sees that kind of growth, it will put on the brakes by raising interest rates in the name of heading off inflation.
Since they were entertaining predictions about future developments, it's more than a little odd that the AP pair chose to ignore many analysts' predictions that the first quarter's GDP result will move into contraction when it gets revised in future months — especially since those downward revisions, supposedly reflecting deferred growth, partially justify their 3.5 percent second-quarter prediction. It sure looks like Rugaber and Boak were selective in deciding what they would report.
In a Friday afternoon dispatch issued in the wake of the government's jobs report earlier that day, Christopher Rugaber and Josh Boak at the Associated Press wrote that "most economists ... forecast a strong rebound in economic growth - to a 3.5 percent annual rate in the current April-June quarter. And growth should reach nearly 3 percent for the full year, up from 1.9 percent in 2013, they expect."
There are two problems with that prediction. The first lies in how strong the third and fourth quarters will have to be for the economy to get "nearly 3 percent" for the full year, given the tiny first-quarter annualized growth of 0.1 percent reported on Wednesday. The second and perhaps more crucial issue is that the full-year estimate significantly exceeds the "altered assessment" at the Fed concerning how fast it thinks the economy can grow without running the risk of igniting inflation.
In June 2006, the New York Times, over strident pleas not to from the Bush 43 administration, published details of how counterterrorism officials were "tracing transactions of people suspected of having ties to Al Qaeda by reviewing records from the nerve center of the global banking industry." According to the administration, the program had "helped in the capture of the most wanted Qaeda figure in Southeast Asia." Other outlets like the Wall Street Journal and the Los Angeles Times, which were apparently on the brink of breaking what the Times reported first, also chipped in with their own supplements. The stories received prominent network TV coverage, and reinforced the image of the Bush administration as secretive and far less than transparent.
So the details of how the government was monitoring the operation of the world's financial system to obtain clues to help catch terrorists apparently deserved full exposure. If that's fine, why has the press been barely interested in a far more troubling development, namely Eric Holder's U.S. Department of Justice using pressure on the financial system to conduct "a massive government overreach into private businesses that are operating within the law," which has been going on for at least a year? Welcome to "Operation Choke Point."
NPR sells itself as a voice of civility, an oasis away from the haters and the shouters. But many NPR stations run the show “Marketplace” from American Public Media. On Wednesday night, host Kai Ryssdalinterviewed author Zac Bissonette, author of the book Good Advice From Bad People.
Ryssdal raised eyebrows with this declaration: “Alright, we will start with a guy for whom I personally believe there is a special place in Hell reserved. His name is Donald Trump.”