“The government reported today that 15,000 more Americans joined the line for unemployment benefits. And despite back-to-school bargains, consumers were not in a spending mood in August. Major retailers reported sales were up just over 1 percent from last year.”
Minutes after Republican vice-presidential pick Sarah Palin finished her speech on Wednesday night, CNN’s Roland Martin and Jeffrey Toobin went on the offensive against the Alaska governor. Co-host Anderson Cooper first asked Martin for his reaction. He first stated that "she gave a solid speech" and then focused on Palin’s dig at Barack Obama being a community organizer in Chicago: "...[S]he mocked community organizers, and this audience laughed at them. Don't be surprised if Obama and Biden says, you know what, it's community organizers who are keeping people from losing their homes in [the] subprime crisis.... It's community organizers who are the ones trying to save your job. They're going to say the GOP does not give a flip about community organizers -- it means they don't care about you...."
Two minutes later, co-host Wolf Blitzer went to Toobin for his reaction. The senior legal analyst for CNN first complimented Palin: "Well, let's just start with an obvious point that I don't think anyone has made yet. This speech was a heck of a lot better than Joe Biden's speech. I mean, it just was much more dramatic, much more interesting, much more entertaining." He then continued with a more blunt analysis of the speech: "But it was also, I thought, very smug, very sarcastic, very cutting. And you know what? The Republicans had been trying to portray her as a victim for the last couple days. Well, she's not going to be a victim anymore. She's going to be a target..." As if she hasn’t been a target since John McCain announced her as his running mate?
Mercantilism [emphasis added]: An economic doctrine that flourished in Europe from the sixteenth to the eighteenth centuries. Mercantilists held that a nation's wealth consisted primarily in the amount of gold and silver in its treasury. Accordingly, mercantilist governments imposed extensive restrictions on their economies to ensure a surplus of exports over imports. In the eighteenth century, mercantilism was challenged by the doctrine of laissez-faire.
When Barack Obama talks—and talks—about the future, does he really mean "back to the future"? You have to wonder after reading the column by one of his economic advisors in today's LA Times. In Renewing America's 'contract with the middle class, Leo Hindery Jr. explicitly calls for a return to mercantilism, the discredited theory of economics popular during the 17th and 18th centuries. Hindery [emphasis added]:
It is imperative -- way past time, in fact -- for America to be as mercantilist as are our trading partners.
Anecdotal evidence is pretty much useless in science, a discipline steeped in empirical data. But that's no matter to the Associated Press or the Washington Post, which published an August 31 AP article about how "Scientists See Fewer Fireflies." The subheading quickly qualified that the "[e]vidence is anecdotal, but experts fault sprawl, pollution."
Of course some of the quoted experts in Casey's article aren't really experts, they're amateur scientists at best, with sprawl and pollution serving as coded language for faulting capitalism for allegedly raping the environment.
AP writer Michael Casey waited until the fifth paragraph of his Thailand-bylined article to confess that "[t]he evidence is entirely anecdotal but anecdotes abound" about a mass worldwide holocaust of the flying luminous bugs.
This after quoting one Preecha Jiabyu, a tour guide on Thailand's Mae Klong River, who dropped an unsubstantiated statistic for readers. "The firefly populations have dropped 70 percent in the past three years," insisted Preecha, whose entomological credentials Casey failed to establish for readers.
Reuters gets the award for the most misleading headline of the day with its Aug 28 story making it seem as if unemployment has wildly increased in New York State -- even calling it a "crisis" -- when there was really only a small increase. The headline would cause the casual reader to assume that the world is falling apart concerning employment rates and on top of that the badly worded headline also feeds into the Bush-ruined-the-economy meme. And we know how Reuters is always looking to smear President Bush whenever it can. Further, Reuters cites the work of the Fiscal Policy Institute without identifying it as a left leaning think tank.
Reuters headlines its New York employment piece Unemployment leaps over 20 percent in 25 New York counties. It is a shocking headline, to be sure, screaming that unemployment "leaps 20 percent." Such a wild headline would certainly cause a casual reader to assume that overall unemployment has risen by 20 to 25 percent. Contrary to the scaremongering of the headline, New York's unemployment did not "leap 20 percent" in over all numbers at all. In fact, the over all unemployment of the state has only gone up by .2 percent, from 5.2 in June to 5.4 in July. That is hardly a number to spark a "Crisis."
The department announced August 28 the economy grew at 3.3 percent in the second quarter of 2008, up from initial reports of 1.9 percent. The revised number exceeded expectations for growth, which economists had put at around 2.3 percent.
But to announce the good economic news - the growth was well above the 1.9-percent average quarterly growth over the last two years - would have undercut one of the main themes of Sen. Barack Obama's speech accepting the Democrats' presidential nominations: an economy in turmoil.
"We meet at one of those defining moments - a moment when our nation is at war, our economy in turmoil, and the American promise has been threatened once more," Obama told the crowd of more than 80,000 Democrats at Invesco Field in the Denver.
The second quarter Gross Domestic Product (GDP) was revised upward Thursday by the Commerce Department from the initially estimated 1.9 percent to a robust 3.3 percent, but neither the CBS Evening News nor NBC Nightly News mentioned the good news, while on ABC's World News anchor Charles Gibson, at Invesco Field, allocated 13 seconds to what he considered “surprisingly strong” economic news:
Other news, a surprisingly strong reading on the economy. The Gross Domestic Product grew at a rate of 3.3 percent in the second quarter, helped by those government stimulus checks and a jump in exports because the dollar is so weak.
NBC News veteran Tom Brokaw, however, was still presuming economic disaster hours after the new GDP number was released in the morning. Just past 2 PM MDT/4PM EDT on MSNBC, Brokaw asserted from Denver:
Beyond this arena, and this city, the American people are facing some of the greatest problems that they have faced, certainly in our lifetimes. Financial crisis, greatest since the Depression; energy crisis; two wars in two different countries; the Russian bear is crashing around in the woods again.
Sometimes the qualities that make a strong candidate in one pool make them a weak candidate in another pool.
Former Massachusetts Gov. Mitt Romney would hurt Republican presidential nominee Sen. John McCain as a running mate because of "vulnerability" stemming from his successful businesses and support for free trade, according to a reporter for The Washington Post.
"On the whole subject of trade deals and free trade agreements is that a vulnerability, a potential vulnerability on the side of Mitt Romney?" Andrea Mitchell asked Post reporter Chris Cillizza on the August 28 broadcast of "MSNBC Live".
"It absolutely is," said Cillizza, who writes "The Fix" blog at WashingtonPost.com. "And that's a calculation I think the McCain campaign has to make. Yes, Mitt Romney has great business bona fides. Built a business, he used that line many times in the primary: ‘I know why jobs come and I know why they go.'"
"The other side of that, however, is he worked for a company called Bingham Capital that occasionally engaged in leverage buyouts, that means shipping jobs overseas. That's not the kind of thing that's going to go over well in these rust belt states where McCain needs to perform well, most notably Michigan, Ohio and Pennsylvania," Cillizza said.
That “Made in America” sticker is looking more attractive.
Second-quarter (2Q) Gross Domestic Product (GDP) was revised up from 1.9 percent growth to a higher than anticipated 3.3 percent, according to reports on August 28.
Rising exports played a significant role in the expansion. According to the Commerce Department, real exports increased 13.2 percent in the 2Q of 2008, compared with an increase of 5.1 percent in the first. Real imports of goods and services decreased 0.8 percent in the first quarter and 7.6 percent in the second.
But on the August 27 "Mad Money," Cramer bucked his that trend and called for higher taxes for top income earners. On his "Mad Mail" segment, a n e-mailer asked Cramer if Democratic presidential candidate Sen. Barack Obama's plan to raise taxes on incomes higher than $250,000 and redistribute the money to lower income earners would be good for the economy.
"If Obama puts more money in the hands of the majority of the consumers in this country (who make less than $250,000), won't that be a big push for the economy, and in turn for stocks?" the viewer, "Laurence in Iowa," asked.
Thursday's edition of CNN's "American Morning" featured a "fact checking" segment on the claims former President Bill Clinton made about his accomplishments as president during his speech to the Democratic National Convention. The segment wasn't much of a "fact check" as CNN Business Correspondent Christine Romans mostly reminisced about the "glory days" of the '90's. But what she did find was that the worst part of Clinton's presidency was one of his more conservative actions: "He also signed into law a historic deregulation of the financial system,dismantling laws from the Great Depression that many say would have protected us against the current mortgage crisis."
Other problems the correspondent found with Clinton's presidency include: "the go-go days of the '90s also gave us the dotcom boom. And when that went bust, Allan Greenspan and the Federal Reserve lowered the interest rates to ease the pain. Dropping them so low, many now see the roots of the current housing mess way back in the dotcom boom. Plus, the '90s gave us this obsession with record home ownership with Clinton as a principal cheerleader."
In case traditional news outlets "forget" to tell you, Uncle Sam announced this morning that second-quarter Gross Domestic Product (GDP) growth was revised sharply upward to 3.3% from the late July's advance estimate of 1.9%.
Dude, where's my recession?
Y'know, the recession that Barack Obama claimed we "almost certainly in" back in mid-July?
Believe it or not, there are supposedly legitimate economists out there who, despite today's news, still insist that we are in a recession -- right now! -- and have been for some time. And of course, reporters are finding them, and quoting them.
Earlier this week, when it was clear that a significant upward GDP revision was in the works, "journalists" at MarketWatch and CNNMoney.com, with the help of their "experts," did everything they could to downplay its impending significance. One even called it a "mirage."
Just in time for Barack Obama's Greco-Roman Oration tomorrow night, two significant economic reports have gone or are about to go in a positive direction:
Earlier Wednesday, the Census Bureau reported that durable goods orders increased 1.3% during July, repeating June's performance; shipments of durables were up 2.5%; and unfilled orders were at their highest level since 1992. There are exceptions, but these companies are generally very busy.
Thursday morning, the pundits are predicting that second quarter Gross Domestic Product, originally estimated at an annualized 1.9%, will be significantly revised upward. Predictions that GDP will come in at 2.7% are at Reuters, Briefing.com via CNN, and MarketWatch. If you go to the links, especially the second and third, you will detect the distinct aroma of sour grapes; the headlines found there are "The economic growth mirage" and "Big revision in GDP won't mean much," respectively.
Don't count on these statistics to get much positive traditional media play while the Obama coronation is in progress.
But there's one other number that's even worse for the everyone's-a-victim crowd than those just noted. It is one that I can almost guarantee will remain invisible during tomorrow's festivities.
Former president Jimmy Carter told Harry Smith on CBS's "The Early Show" August 27 that he predicted "oil companies will hold down oil prices a little bit, you know, to try to help the Republican ticket."
Carter also said that the economy would be the most important issue, "as it was when Bill Clinton was elected the first time."
The former president also said it was "surprising and gratifying" when presumptive Democratic candidate Sen. Barack Obama, Ill., carried Georgia in the primary "over two attractive white candidates-Hillary Clinton and John Edwards."
Greg Hunter, a CNN correspondent for "Your $$$$$,"made the same prediction that oil prices would go down as the election nears on the June 16 broadcast. "[T]hey're going to drive that price down, they're going to pop the dollar up, they're going to drive the price down, they're going to work this, say, for the election," he said.
Former New York City Mayor and Republican presidential candidate Rudy Giuliani was interviewed on Wednesday's "American Morning" by co-host Kiran Chetry about Senator Hillary Clinton's Tuesday night speech to the Democratic National Convention. After Giuliani argued that Clinton never answered the "big question" surrounding Senator Barack Obama of whether he is ready to be Commander-in-Chief, Chetry asked: "Well, what I'm wondering though, you know, is the GOP trying to paint her into a no-win situation? If she started bringing up some of Barack Obama's weaknesses that she talked about in the primary, she would have been panned for that."
Giuliani responded by saying that Clinton wouldn't have to actually bring up anything she's said about Obama's readiness to lead during the Democratic primary, she could have simply "talked about how she's gotten to know him, how much she believes in him, his character, his strength."
Chetry then brought up the Democratic talking point that Senator John McCain's term as president would continue the last eight years of President George Bush's presidency. She mentioned that some McCain supporters claim the senator is a maverick on issues such as campaign finance reform. However, the co-host was not convinced. She asked: "But really, how will McCain show besides those things that he is different from the Bush administration?"
Partly because this story doesn't fit preconceived liberal storylines and partly because the Democratic Convention is taking up all the oxygen in the mainstream media, you can expect this story to remain buried in your newspaper and be given little if any attention on cable news networks.
From page 17 of today's Financial Times, "US drillers to get $1bn court award" comes news of how federal government red tape often holds up oil companies for drilling on leases they've already sunk billions of dollars into (emphasis mine):
A US federal appeals court ruled yesterday that 11 oil and gas companies should receive more than $1bn awarded to them in 2006 after the government effectively changed the terms of leases to drill off the California coast.
The US Court of Appeals was upholding a 2006 ruling that the government had breached the leases when changes in federal law materially interfered with the companies' efforts to develop the oil and gas reserves off California.
The case points to the difficulties US oil and gas companies have developing oil and gas resources in the US.
Reuters thinks that tax breaks and loopholes "costs" government its tax receipts. This is a perfect example of class hatred ginned up by the media to further class warfare between Americans. The absolute truth is that if people use the tax code to limit their tax burden they are not costing the government anything, but are using legal means to avoid a higher tax burden. Further, our money is NOT the government's property in the first place so a lower tax take is in no way "costing" the government anything. Yet, Reuters still uses this class warfare rhetoric to report its story revealing its attack-the-rich agenda.
The Reuters headline employs the class warfare rhetoric right off the top screaming, Tax loopholes seen costing billions annually. "Costing"? No, if tax receipts are lower it isn't because people are depriving government of due receipts. Again, it is because taxpayers are obeying the law and properly using the tax code as crated by Congress. If there are loopholes in the tax code they were placed there by Congress, whether wittingly or unwittingly, but still it’s the fault of Congress not “the rich.”
It seems like a no-brainer: Raising taxes is bad. It's a shame that Barron's is one of the few outlets to pick up on it.
An economic plan floated out by Democratic presidential hopeful Sen. Barack Obama, Ill., would raise taxes on incomes above $250,000 - with the highest rate at 39.6 percent - and redistribute the wealth to the poor and middle-class. But that would be a big mistake, according to an article by Jim McTague in the August 25 issue of Barron's.
"It's almost as if Obama wants to repeat the mistakes of Herbert Hoover," McTague wrote. "During the Great Depression, Hoover raised the top marginal rate to 63% from 25% and hiked corporate taxes, too, says Michael Aronstein, chief investment strategist at Oscar Gruss & Son in New York. The moves siphoned needed investment capital out of the markets and into the hands of bureaucrats, delaying the turnaround."
To find "experts" on a particular issue, ABC’s Chris Cuomo, first profiled a left leaning organization, but only cited them as "non-partisan." Beginning a series of in depth segments examining Obama’s stance on the issues, Cuomo offered what appeared to be a fair assessment of Barack Obama’s plan.
Although, the "Good Morning America" host featured some criticism of Obama’s plan and offered challenging questions to Obama’s economic adviser, Cuomo identified the Tax Policy Center (a division of the liberal Brookings Institution) as "non-partisan"only featuring them for expertise.
Cuomo featured a family earning $70,000 a year and cited the Tax Policy Center to claim they will receive an almost 50 percent reduction in taxes. That runs counter to the more conservative American Enterprise Institute which found Obama "would raise marginal tax rates for many middle-income tax payers."
So if a government program has been failing for decades, should you A) Privatize it, B) Get rid of it altogether, or C) Throw millions of dollars at it and hope that Americas somehow feel compelled to reenact scenes from "Some Like it Hot."
The answer is C if you were watching CNN this morning.
"American Morning" pointed out that high gas prices were the reason ridership on Amtrak was up 14 percent and then pushed for more funding for the government-sponsored program through a recent Senate proposal.
"The problem for Amtrak of course though is that they haven't had a single new passenger car since 1990," said personal finance editor Gerri Willis on the August 21 broadcast. "Their cars, even the locomotives are old and aging; they're asking Congress for help. Dick Durbin has introduced legislation into the Senate to try and do something about that. Interestingly he says that Thanksgiving is going to be a wake up call for Americans as we all try to go visit relatives for the holidays."
"What they need is new track, because every Sunday it's like this all the way up," said co-host John Roberts simulating a bumpy train ride with his anchor chair.
According the Associated Press, "Ask AP" is "a weekly Q&A column where AP journalists respond to readers' questions about the news."
Given how biased the wire service's news reporting is, you wouldn't expect "Ask AP" responses to be very different. They usually aren't.
Case in point (second question at link) -- Reader Cindy Garcia of Vista, California asked AP about the costs and benefits of illegal immigration:
I hear so many conflicting stories on illegal immigration. Please tell me if you can how much the illegal immigrants contribute to the economy and how much they use in free services. If they all got deported, how would it affect our economy?
Here is the sadly incorrect and incomplete answer from AP writers Laura Wides-Munoz in Miami, Jacques Billeaud in Phoenix, and Suzanne Gamboa in Washington (bolds are mine):
Perhaps it's the pied piper effect, but when Democratic presidential nominee Sen. Barack Obama speaks, the media follow right along in lockstep.
The word "disaster" can invoke images of the aftermath of hurricanes, tornados or tsunamis. But, on the campaign trail where there are political points to be scored - it's one quarter of a slight economic contraction followed up by two quarters of shallow economic growth, according to Obama.
"Then he started running ads saying oh, Obama's just going to raise your taxes and he'll lead to an economic disaster," Obama told his campaign audience. "Mr. McCain, let me explain to you, the economic disaster is happening right now. Maybe you haven't noticed."
When is an increase in consumer confidence bad news? When ABC reports it.
Network anchor George Stephanopoulos led off the news cast with this gloom-and-doom teaser: "Terrible Tuesday. Inflation surges. Stocks dive. And consumer confidence nears a record low."
But Stephanopoulos left out a key detail: consumer confidence increased according to the network's own measure. "U.S. overall consumer confidence rose last week, according to an ABC News/Washington Post poll released Tuesday," the August 19 Dow Jones Newswires reported. ABC never mentioned that in its report.
Amity Shlaes, a senior fellow at the Council on Foreign Relations, penned an August 18 Washington Post column examining five of the government's Depression-era mistakes that made financial matters worse. Shlaes, author of "The Forgotten Man: A New History of the Great Depression" cautioned today's lawmakers against following in those footsteps.
A study released today by the slightly left-of-center Project for Excellence in Journalism confirmed what many NBers have suspected for a while: the media's negative coverage of the economy affects public opinion.
According to PEJ, the public's concern about the economy as an issue has always outstripped that of the media. That's pretty normal considering that America's economy is one of the few large news stories that affects the average person.
Where things change, however, is in the public's perception. There seems to be a direct correlation between increases in negative media reports about the economy and lower amounts of public confidence in the economy:
The Land of Lincoln had a seasonally adjusted unemployment rate of 7.3% in July, up 2.2% from the previous year's 5.1%. That puts Illinois, along with California, in a tie for fourth place in the worst state unemployment rate derby, behind only Michigan (8.5%), Mississippi (7.9%), and Rhode Island (7.7%).
Illinois' 2.2% year-over-year unemployment rate increase is the third largest in any state, behind only tiny Rhode Island's 2.7% and smaller state Tennessee's 2.3%. Over 80% of Illinois' deterioration has occurred in the last three months, as its March unemployment rate was only 5.5%.
Perhaps the media's Obama lovefest isn't as infectious as previously thought - at least in some corners of the financial media. For the second day in a row CNBC's Michelle Caruso-Cabrera noted low taxes - a conservative economic ideal - trumps those of the left, both economically and politically.
"You know what I just love, Doug?" Caruso-Cabrera asked. "Everybody and their mother, whenever they want to endorse their tax plan - they want to cite the almighty Ronald Reagan, right? I mean, everybody wants to dump all over the Republicans, but when they want to tout their economic and their tax plan, who do they go back to? The guy who cut taxes and cut taxes."
It's not often someone in the media challenges the liberal point-of-view - especially on the issue of taxes when they become a means to redistribute income.
CNBC "Squawk Box" fill-in co-host Michelle Caruso-Cabrera wasn't afraid to buck the trend and challenge Democratic presidential nominee Sen. Barack Obama's senior economic adviser Austan Goolsbee.
Goolsbee appeared on the August 14 "Squawk Box" to defend an op-ed he wrote for the August 14 Wall Street Journal outlining Obama's tax plan. Caruso-Cabrera invoked the name of Milton Friedman, an economist who was a primary defender of free markets throughout the 20th century. Ironically, Friedman taught at the University of Chicago, where Goolsbee is a faculty member.
"WWMD, Austin - what would Milton do? Remember that," Caruso-Cabrera said. "Remember your roots - what got you to where you are."