Economy

Ford's protracted sales slump continued in May, while every other major automaker showed gains:

DETROIT — Toyota Motor Corp.'s U.S. vehicle sales jumped 14.1 percent in May to its best monthly level ever and General Motors Corp.'s sales rose 9.7 percent, helping boost industry sales 5 percent, as both automakers credited in part the appeal of their more fuel-efficient offerings amid high gas prices.

For the second month this year, Toyota outsold Ford Motor Co., which saw sales fall 6.9 percent as it continued to cut low-profit sales to rental companies. Nissan Motor Co.'s sales gained 7.4 percent, DaimlerChrysler AG's sales rose 3.9 percent and American Honda Motor Co. rose 2.5 percent.

Even factoring in the change in sales to rental companies, the article goes on to say that Ford's retail sales were still down 3%.

As he did last month, George Pipas of Ford tried an advance PR stunt that fizzled, but left less-than-close observers thinking that the company might be doing better than it really is:

While the relatively narrow Dow Jones Industrial Average has been achieving alltime highs for a couple of months, it took until last week for the broader S&P 500 index to beat its previous record of 1527. The index closed at 1536.24 last week.

Instead of writing up the big winners in the 77% of companies that have brought the index back from its 2000 low, USA Today writer Matt Krantz looked for dark clouds in on otherwise blue sky, taking an opportunity to focus on the index's losers who kept the index's recovery of value from happening sooner:

S&P's run leaves Wal-Mart, other big caps behind

For a quarter of the stock market, the celebration about the Standard & Poor's 500's charge back to record levels for the first time in more than seven years is an example of history being written by the victors.

Even though the benchmark S&P index last week finally took out its old high from March 2000, investors who own 23% of its stocks have completely missed out. A total of 115 stocks in the S&P 500-stock index are still below where they were in March 2000, according to data from Bridge Information and S&P. They aren't down just a little, either, but off 45% on average.

"At any given time, you're going to have companies that have one-off issues," says James Paulsen of Wells Capital Management.

Yeah guys, and that's why investing in a broad-based index of stocks in an index mutual fund is often a good idea for investors who don't have the time to evaluate and keep up with either individual stocks or actively-managed mutual funds. Zheesh.

On February 28 (second item at link), New York Times business reporter David Leonhardt infamously wrote the following:

For Manufacturing, a Recession Has Arrived

The nation’s manufacturing sector managed to slip into a recession with almost nobody seeming to notice. Well, until yesterday.

To this day, Leonhardt appears to be the only one to "notice" a recession in manufacturing -- because it doesn't exist. In fact, the latest related report from the Institute for Supply Management (ISM) showed that the manufacturing sector expanded for the fourth straight month. That would include February, when Leonhardt made his "recession" call. The ISM reading of 55.0 (any reading over 50 indicates expansion) actually inched up a bit from the previous month's 54.7.

Though it's not possible to tell for sure because of the TimeSelect subscription wall, a Times search on "manufacturing recession" (not in quotes) shows no apparent retraction of Leonhardt's call, but does include plenty of references to other reasons why a recession might be possible.

Leonhardt's "less than perfect" reporting has apparently continued.

The three charts at the end of this post from the Bureau of Labor Statistics should be cause for concern.

They show the unemployment rates for Blacks (African-Americans), all teens, and African-American teens during the past 10 years.

Each low unemployment-rate point achieved in 2000, when the overall unemployment rate reached its low point of 3.8%, was much lower than it is currently. Specifically:

• The Black/African American unemployment rate is 1.5% point higher (8.5% currently, 7.0% in April 2000). The percentage of African-Americans who are unemployed is still 21% higher (8.5/7.0) than it was at its low point in 2000.
• The teen unemployment rate is 3.4% point higher (15.7% currently, 12.3% in June 2000). The percentage of teens who are unemployed is still 28% higher (15.7/12.3) than it was at its low point in 2000.
• The Black/African American teen unemployment rate is 10.4% point higher (30.4% currently, 20.0% in April 2000). The percentage of African-American teens who are unemployed is still 52% higher (30.4/20.0) than it was at its low point in 2000.

If the 2007 unemployment rates in the these categories were the same as they were in 2000, the overall unemployment rate would be about 0.3% lower, and much closer to its 2000 low.

It’s déjà vu all over again. Rising gas prices and oil companies’ “record profits” fuel an almost yearly call for investigations into “price gouging.” The media then complain of alleged wrongdoing and fail to ask intelligent questions about the issue.

Rising gas prices are “[k]inda suspicious,” according to CBS “Early Show” co-host Julie Chen on May 23.

Co-host Harry Smith agreed saying, “It makes you wonder at least a little bit.”

Update: SEE Editor's Note at bottom of post for related MRC content.

1Q07 Home Prices Up 0.5%, 4.3% Over 12 Months Ago

Those looking for a pervasive and severe nationwide decline in home prices are going to have to keep looking.

The Office of Federal Housing Enterprise Oversight (OFHEO) just released its House Price Index (PDF) for the first quarter of 2007. This most comprehensive of home-price reports shows that nationwide prices increased 0.45% (rounded to 0.5% in the announcement) in the first quarter of this year, and went up 4.25% (rounded to 4.3% in the announcement) in the past four quarters.

Core inflation during those two time periods was 0.6% and 2.5%, respectively. OFHEO says that inflation excluding only shelter costs only rose 1.6% during the past year.

Context (from Pages 4 and 5 of the report):

• From 1990 through 1997, reported four-quarter appreciation was less than the 4.25% just reported 28 out of 32 times.
• During that same time period, individual-quarter appreciation was less than the 0.45% just reported 14 out of 32 times -- including six nationwide quarterly declines.

I recall no discussions of pervasive real estate "bubbles" or fears of steep, widespread declines during the 1990s.

Update posted below w/link to NRO's Bench Memos.

"Over Ginsburg's Dissent, Court Limits Bias Suits," blared the May 30 front page headline by the Washington Post Supreme Court reporter Robert Barnes. While the 5-4 ruling in Ledbetter v. Goodyear Tire and Rubber Co. hinged on a plain and simple application of a 1964 federal law, Barnes front-loaded his article with the dissent of liberal Associate Justice Ruth Bader Ginsburg, buried the majority's rationale deep in the article after pro-Ginsburg feminist talking points, failed to include comment from Goodyear Tire, and gave readers an unbalanced portrait of the ruling focused on feminist reaction.

Let's take a look at how Barnes's bias unfolded, starting with the lede and second paragraph:

Politicians like Nancy Pelosi who carp about high gas prices and brood about gouging while simultaneously bemoaning global warming are hypocrites. That's the gist of Robert J. Samuelson's column in today's Washington Post. The actual title is A Full Tank of Hypocrisy, but the teaser headline for it on the online op-ed home page is "The Case for Gouging."

Samuelson in fact disputes that gouging, in the sense of collusion among oil producers/refiners, is taking place. He points out, for example, that concentration of ownership in the oil industry has been deemed low-to-moderate, "less concentrated than the auto industry, which is considered intensely competitive." But the long-time WaPo columnist does make the case than many politicians in the global-warming crowd are engaging in some have-it-both-ways hypocrisy on the issue of higher gasoline prices.

If you've been listening to the news, you might be surprised that the national average for gas is $3.20 - not $4 or more. Media hype of rising gas prices included predictions of $4, $5 and even higher national averages for gasoline.

MRC Business & Media Institute director and Newsbusters contributor Dan Gainor appeared on Fox's "Your World with Neil Cavuto" on May 28, 2007 to combat the hype.

"Nobody's saying gas prices aren't high. What we're saying is for the last couple years the media have warned us about $4 a gallon, $5, $6 - even $7 a gallon gas. It's never topped more than $3.22 and it's actually dropped in the last couple days," Gainor told viewers.

Video (0:39): Real (1.05 MB) or Windows Media (1.25 MB), plus MP3 (188 kB).

As global warming alarmists in the media and on tour buses enflame hysteria concerning a nonexistent climate crisis, there is an inconvenient truth they routinely ignore: carbon dioxide emission reductions will hurt economies across the globe while worsening poverty.

This seemingly immutable fact, which continually eludes the deluded such as soon-to-be-Dr. Al Gore and his band of not so merry sycophants, is understood by India which has up to this point refused to participate in any emissions requirements set forth by the United Nations.

As reported by Australia’s Herald Sun Tuesday (h/t Benny Peiser):

In an excellent investigative report last Sunday (may require free registration) that is part of a series on how "how businesses and investors seek to profit from the soaring number of older Americans, in ways helpful and harmful," the New York Times' Charles Duhigg exposed the despicable tactics of elder-scam artists and the "information services" companies that supply them the "sucker lists" they need.

He may not have known that he was simultaneously exposing information that could, and arguably should, damage the presidential campaign of Hillary Clinton.

Duhigg led with the truly sad story of 92 year-old Richard Guthrie:

..... He ended up on scam artists’ lists because his name, like millions of others, was sold by large companies to telemarketing criminals, who then turned to major banks to steal his life’s savings.

On the top right of Friday’s front page of The New York Times is a story headlined "Immigration Bill Provisions Gain Wide Support In Poll: Majority Favors Path to Legal Status for Illegal Aliens." Reporters Julia Preston and Marjorie Connelly wrote the story in a way that framed the poll like a memo to Congress, saying "Please pass the bill, the polling water’s warm."

The reporters claim the American public is "taking a pragmatic stand on a divisive issue," which could be interpreted to mean they change their answers based on how the poll question is phrased. It's so divisive individual voters have two different opinions depending on the pollster's lingo. But Preston and Connelly began by insisting: "As opponents from the right and left challenge an immigration bill before Congress, there is broad support among Americans – Democrats, Republicans, and independents alike – for the major provisions in the legislation."

On May 15, NewsBusters noted that the press were missing the seemingly obvious connection between higher gasoline prices and the federally mandated use of ethanol.

In doing so, they were also mysteriously passing on a fine opportunity to bash the Bush administration, something that obviously defied logic and precedent.

Well, it appears nine days later the folks at the New York Times recognized this oversight, and published a front-page business section article entitled “Oil Industry Says Biofuel Push May Hurt at Pump” (emphasis added throughout):

That's right. Bubble, shmubble, despite this picture from Matt Drudge, who got snookered on this one:

Fire sales, schmire sales.

The Chief Snookerer in the latest search for the elusive housing bubble is Martin Crutsinger of the Associated Press, with a significant assist from the Commerce Department (link is to a PDF), which inexplicably did not, and apparently does not, report the regional sales data needed for a more detailed look.

Crutsinger took Commerce's housing report showing a significant decline in the nationwide median selling price of a new home, both in the past month and year over year, and ran with it at an all-out sprint (bold is mine):

The American left loves to chant "no blood for oil." But those same liberals would eagerly sacrifice American interests in the name of . . . a cheaper Caesar salad.

Take this morning's report on CNN which came at about 7:35 am EDT. Entitled "Farm-Fresh Problems," the segment, narrated by CNN's Chris Lawrence, focused on the lack of illegal immigrant labor to harvest California's fruit and vegetable crops.

CNN REPORTER CHRIS LAWRENCE: California harvests about half the nation's fruits and vegetables and every summer, farmers need half-a-million workers to pick those crops. But the crackdown on illegal immigrants is keeping workers out of their fields, leaving unpicked fruit left to rot.

HENRY VEGA [California farmer]: They're definitely worried about being raided and deported.

View video here.

It has been over three weeks since the fundamental claim of the "Food Stamp Challenge" was debunked, first by Mona Charen in her syndicated column, then in more detail by yours truly (at NewsBusters; at BizzyBlog). Yet the "Food Stamp Challenge" has spread.

As noted in this NPR report from April 23, it all started in Oregon. That state's governor, Ted Kulongoski, joined in and put on quite a show, getting plenty of Old Media attention (Associated Press; New York Times [may require free registration]) as he tried to buy a week's worth of groceries with $21, because that was said to be what "the state’s average food stamp recipient spends weekly on groceries."

The Challenge's claim that the average Food Stamp recipient's benefit of $21 per person per week is all that beneficiaries have available for purchasing food is incorrect, as anyone visiting the USDA's web site could have learned very easily.

As I noted in late April, the Food Stamp Program’s "Fact Sheet on Resources, Income and Benefits" provides a table of "Maximum Monthly Allotments" (i.e., benefits), and says the following about benefit levels (bold is mine; I converted the Monthly Allotments to weekly allotments per person by dividing by the average number of weeks in a month [4.345], and then by the number of people):

Back on April 23, as NewsBuster Scott Whitlock noted at the time, ABC’s Diane Sawyer fretted about the supposedly sky-high stock market. “Is this the thrill before the meltdown?” she panicked. “What should you do this morning to protect your money?” ABC's on-screen graphic ridiculously wondered: "Is Unstoppable Market Good or Bad?"

Today, an Investor’s Business Daily editorial mocks Sawyer’s Chicken Little approach. “We’re still waiting for the ‘meltdown’ that ‘Good Morning America’ stock guru Diane Sawyer was warning us about a month (and 600 Dow points) ago, when she devoted a segment to what we should do ‘to protect our money.’”

It’s the age gap, stupid.

USA Today’s article on the “generation gap” in income and wealth has the power to revolutionize media coverage of “income inequality.” It’s not inequality between people in general that’s growing, Dennis Cauchon’s report said – it’s inequality between generations. Young people are delaying careers for more education, marrying later and even getting their inheritances later. Meanwhile, retirees are living longer and living off the payments of those same youngsters.

Don't you dare call Mika Brzezinski a mere newsreader. Beyond simply enunciating words off the teleprompter, the MSNBC host doesn't hesitate to share her [left-leaning] views with viewers, too.

Take a segment that aired at 3:35 pm EDT today on the topic of gasoline prices. Introducing the discussion, Mika expressed her shock and outrage that sales of SUVs have recently risen despite relatively high gas prices. Pouted Mika: "what's wrong with these people? Why do they need them?"

Mika's guest was Tyson Slocum of the liberal Public Citizen group, which is headed by Joan Claybrook, a former Carter administration official. Mika, of course, is the daughter of another Carter administration official, former National Security Advisor Zbigniew Brzezinski. A couple members of the extended Carter-administration family, having a friendly chat on a day the former president is making headlines for breaking the unwritten taboo on past White House occupants bashing the incumbent.

As Al Gore and his band of not so merry global warming alarmists in buses and in the press try to convince Americans that they need to alter behaviors in order to save the planet, an inconvenient truth is being cynically withheld: this is going to cost a lot of money.

Of course, one of the delicious hypocrisies is that these are the same people who decry the current economic boom as only helping the rich, and state regularly and fervently that the poor and middle-class are being left behind.

At the same time, such mid- to lower-level wage earners should be saddled with exorbitant additional expenses to shelter them from a wolf that might never come knocking at their doors.

Makes sense, right?

With that in mind, the Chicago Tribune’s Laurie Goering wrote a fabulous piece recently exposing some of the potential costs of this exercise that most media don’t want you to know (emphasis added throughout, h/t Benny Peiser):

Kimberley Strassel's OpinionJournal.com column about coal-mine operator Robert E. Murray of Murray Energy is important on a number of levels.

You haven't heard of Robert E. Murray? That's not surprising.

If there were an open dialog instead of continual blather about "settled science" when it comes to supposedly human-induced "climate change" and "global warming" (two concepts I like to collectively refer to as "globaloney"), Murray would have visibility. But, as Strassel writes, a different "climate," the political one, appears to be keeping him largely out of the public eye, despite his best efforts to break through.

You see, Robert Murray is a coal-company executive who has first-hand experience with what will happen on a much broader scale if the radical changes envisioned by Al Gore and others (whom I like to refer to as "globalarmists") ever get enacted:

There was a summit between Russia’s Vladimir Putin and the leaders of the European Union on Friday that yielded as little results as it did attention from America’s media.

One of the issues on the table was whether Russia is going to provide more energy resources to EU nations starved for such.

Didn’t hear about this?

Well, that’s not surprising, for in the midst of the media’s ongoing attempts to create global warming hysteria while pushing the U.S. to participate in the Kyoto Protocol, our press have little interest in reporting how energy politics across the Atlantic and Pacific oceans are threatening economies around the globe.

Contrary to most American media that ignored this dicey subject, the BBC covered the following Associated Press article Friday (emphasis added):

Although the Kelo v. New London Supreme Court ruling almost two years ago caused an outpouring of outrage that still resonates nationwide, what has happened in New London itself in the wake of the decision has, with rare exception, received relatively little coverage outside of the state of Connecticut or, in a few instances, New England.

It isn't as if there haven't been many noteworthy developments after the decision was handed down. To start, here is a rundown of events that ultimately led to last summer's settlement:

• Within a month of the decision, the New London Development Corporation (NLDC) notified the Kelo holdouts that since they had been living on land that they didn't own during the duration of the lawsuit, they were liable for back rents during that entire time, in some cases amounting to hundreds of thousands of dollars. This outrage, originally noted in local Connecticut weekly whose article link is no longer available, got no national attention until bloggers took note of it (here, here, and here, to name a few) and percolated it to the higher levels of the blogosphere (examples here [f-bomb warning] and here). Even then, Old Media, with few exceptions, one of them being this USA Today editorial, gave this shocking example of bureaucratic chutzpah little notice.

As gas prices are on a springtime upswing and the summer driving season is upon us, NewsBusters and the Media Research Center's Business & Media Institute have documented the media's persistent hype about gas prices.

But if the media really want a story about an economy running on fumes, they need look no further than Zimbabwe, where socialistic thuggery has resulted in a starving nation bedeviled with 3,700 percent annual inflation and electricity rationing.

Oh, things weren't always this bad. This time last year it was only at 1,000 percent inflation in Zimbabwe, and that's over 100 times worse than the single-digit "stagflation" that then-CNN contributor Andy Serwer feared just five months before the 2006 midterms.

Appearing on Good Morning America today, Geraldo Rivera claimed that illegal aliens in the United States are "law abiding." Is he right?

In a debate moderated by GMA co-host Diane Sawyer that began today at about 7:15 am EDT, Geraldo faced off against Glenn Beck. Rivera made a case for letting the estimated 12 million illegal aliens remain in the country.

GERALDO RIVERA: We have 12 million people who are gainfully employed; the vast majority of them are. I submit to you that these people are a vital part of the American economy. That they are doing jobs that essentially Americans don't want. Americans are fully employed. To lose these 12 million hard-working people, law-abiding, family people, socially-conservative people in many ways, I think would be a travesty.

When Beck challenged Geraldo's law-abiding claim, pointing to the three illegal aliens who were among the al Qaeda-inspired terrorists planning to attack Fort Dix, Rivera retorted that the fence Beck favors wouldn't have kept them out, since they came in through JFK airport.

In the unlikely event John Edwards is elected the next president of the United States, don't look for Dee Dee Myers twirling on the dance floor with him at the Inaugural Ball. Appearing on this morning's "Today," the former Clinton press secretary took some serious shots at the former senator from North Carolina.

At about 7:08 am EDT this morning, Meredith Vieira began a tour of the presidential horizon with Myers and conservative commentator and radio talk show host Laura Ingraham. Talk turned to Edwards, and Vieira framed the issue in a manner not particularly flattering to the ex-trial lawyer.

Interviewing Shell Oil's president on this morning's Today show, NBC's Meredith Vieira cited Democratic Senator Chuck Schumer's "Big Oil" conspiracy theory, worried America's "addiction to oil" was "dangerous," and altogether added fuel to the fire that oil company execs, "were a bunch of thieves." Appearing in the 7am half-hour, Shell Oil president John Hofmeister, for the most part, explained the basic economics of the oil business to viewers but that didn't stop Vieira from throwing out conspiratorial charges from left-field.

After asking if Hofmeister thought the price of gas was "reasonable," Vieira launched into the conspiracy theories:

Vieira: "Let's talk about the refineries for a minute because there's been a lot of controversy about them. Maintenance problems at refineries around the country. There are some people, consumer activists, some analysts and even some politicians like Senator Schumer here in New York, who believe that the oil companies are basically holding back the production of gas, they're slow on repairs of their refineries, to keep the price of gas high. Senator Schumer has not gone so far as to say that the oil companies are in collusion but he did say, quote, 'that they wink at each other and do the same thing.' First I'd like your response to that."

A cartoon in the May 13 "Sunday Briefing" on page F2 of the Washington Post furthered a left-wing talking point against "Big Oil" that a comprehensive study by the Federal Trade Commission (FTC) debunked last year: that oil companies artificially manipulate gas prices by squeezing supply.

A cartoon from the Newark Star-Ledger's Drew Sheneman depicts a man fueling his car asking a cigar-smoking "Oil Co." representative, "Why do gas prices always go up right before the summer vacation season?" "Coincidence," replies the oil executive, as he stands atop the fuel line, bottlenecking the gas on its way to the motorist's car. The price atop the pump reads $3.50.

The implication, of course, is that the petroleum industry artificially bottlenecks supply to jack up fuel costs.

But that's not true, previous probes into allegations of price gouging have determined, including a May 22, 2006 FTC study of post-Hurricane Katrina gas prices.

Among the major conclusions, the FTC post-Katrina found:

Perhaps you read this week that in April, the US Treasury reported all-time-record tax collections of $383.6 billion.

If you did, you didn't read it in the dead-trees version of the New York Times. The Old Grey Lady did not deem Thursday afternoon's news "fit to print" on Friday (requires free registration), even choosing not to carry the related Associated Press report that is the main topic of this post (even though the Time posted it online Thursday evening). A Times search on "April treasury" (not in quotes) shows no evidence of any other coverage since then, nor does Sunday's Business home page.

The Washington Post also carried that AP story and nothing else (also searching on "April Treasury," not in quotes).

So, unless you happened to read a brief report from MarketWatch (requires registration) or subscribe to the Wall Street Journal (requires subscription), odds are that anything you read or heard about April's Monthly Treasury Statement came from the aforementioned AP report, written by good old Martin Crutsinger (some previous examples of Crutsinger's demonstrated bias and ignorance are here, here, here, and here).

Crutsinger's full report is here. Before I get to his biggest oversight, here are the report's relatively minor (I'm not kidding) shortcomings:

"World News" anchor Charles Gibson promoted the costly green lifestyle, but ignored the hypocrisy of his cross-country flight to report on May 9.

Gibson traveled from New York, to San Francisco for the "Going Green" segment, which featured one man who has "no idea how much" carbon he emits; and another who drives a hybrid, uses solar panels and buys "squiggly" light bulbs.

The ABC anchor supported the choices of Peter Boyd (the one with the solar panels), but left out cost information about those lifestyle choices, and his own jet-setting behavior.

In fact, the solar energy situation in California is "a mess," according to the Los Angeles Times.