What is it about the mainstream media?
What is it about the mainstream media and the American economy? Why are they always looking for slowdowns, soft patches, double dips or whatever? If anybody bothered to look under the headline 3.1 percent GDP report yesterday, they’d see that 1.5 percentage points were lopped off because of the $660 billion increase in real net imports. But that’s a sign of strength. Consumer and business activity is strong, that’s why they’re buying foreign goods.
If you put the import number back into GDP, you get a 4.5 percent quarterly gain. The same thing happened in the first quarter. The first estimate was 3.1 percent. It was below the 3.5 percent consensus. And the headlines screamed slowdown. But the final number came in at 3.8 percent, a much better picture.
So, history is repeating itself.
If the mainstream media wants to pick on lousy economies, why don’t they go after Western Europe or Japan, where growth is less than 1 percent.
Core private growth in the U.S. is actually over 5 percent in the past year. Today’s personal income report shows another big gain. Year-on-year, wages and salaries are rising nearly 6 percent. Entrepreneurial proprietors’ income is up 9 percent. And the core inflation rate is only 1.7 percent. Meanwhile, profits are rising at 19 percent in the first quarter, compared to a consensus estimate of only 10 percent.
Profits drive business. And business drives the economy. Which, by the way, is strong, not weak, with historically low interest rates.
I don’t know what the media has against the American economic machine. But once again, I’m here to report that the state of our low tax, low inflation, deregulated, high productivity, and technology-streamlined economy is quite healthy. And is likely to remain so for a good long period ahead.
If you put the import number back into GDP, you get a 4.5 percent quarterly gain. The same thing happened in the first quarter. The first estimate was 3.1 percent. It was below the 3.5 percent consensus. And the headlines screamed slowdown. But the final number came in at 3.8 percent, a much better picture.
So, history is repeating itself.
If the mainstream media wants to pick on lousy economies, why don’t they go after Western Europe or Japan, where growth is less than 1 percent.
Core private growth in the U.S. is actually over 5 percent in the past year. Today’s personal income report shows another big gain. Year-on-year, wages and salaries are rising nearly 6 percent. Entrepreneurial proprietors’ income is up 9 percent. And the core inflation rate is only 1.7 percent. Meanwhile, profits are rising at 19 percent in the first quarter, compared to a consensus estimate of only 10 percent.
Profits drive business. And business drives the economy. Which, by the way, is strong, not weak, with historically low interest rates.
I don’t know what the media has against the American economic machine. But once again, I’m here to report that the state of our low tax, low inflation, deregulated, high productivity, and technology-streamlined economy is quite healthy. And is likely to remain so for a good long period ahead.
posted by Money Politic$ at 4:09 PM
163 Comments:
Bottom line, although 3.1% was lower than expected, it was still OK. Remember the 1994-1996 mid-cycle economic slowdown? Its happening again. And do you remember the 1994 market funk? Its happening again in 2005. Do you remember the market launch of 1995? That happens next year.
And Greenspan can take a breather. The yield on the 10- year T note just bought him a ticket to Cabo San Lucas.
Head-line of the day: Bush proposes cut in Social Security Benefits!
Bad news of the day: Greenspan cashes in ticket to Cabo...Has 5 more rate hikes to accomplish.
it's laughable that you people think the economy is good. there is little wage growth and little job growth compared to the average recovery. they have no savings, we're running HUGE twin deficits, the dollar is falling and we have bubbles in stocks, bonds and real estate. Americans have never had less equity in their homes in decades.
add to that, the boomers are retiring and haven't saved enough.
the economy is built on an unsustainable foundation of debt growth fueled by low interest rates and consumers overconsuming.
it's funny the difference between what you here kudlow say, and the headlines:
Car shoppers drown in debt
According to a recent Kelley Blue Book study, six out of 10 new-car shoppers, in an effort to cope with mounting sticker prices, opt for a longer-term loan with lower payments instead of taking on a smaller debt overhang.
http://www.marketwatch.com/news/story.asp?guid=%7BEDDAAA82%2D6044%2D49FA%2DB00E%2DA7EDDDD12990%7D&siteid=mktw&dist=
just wait till they're underwater on their house.
After us will come the flood...
Don't worry John Law, Hillary Clinton will save us.
John Law: I'd suggest you run for the hills and stuff your money in a mattress.
Stocks overvalued? Dow is at 17.53 times earnings and S&P is at 18.99...we aren't OVERVALUED...overvalue are when these indicies are above 22 times earnings.
I'll give you this...GM is way overvalued to future earnings.
17 times isn't cheap by any means. look at the dow/gold and dow/silver ratios and you'll also get the same picture.
what about the dow/copper? Dow/Oil?
Like I said Law...go for the hills, stuff your cash in your mattress, and fish up there.
it won't be dollars I'd stuff in there, I'd rather have yen and euros...you know, appreciating currencies.
hahaha
Q1 corp. profits up over 19%, 10-year T note yield at 4.20%, 12 mos foreward earnings for the S&P now estimated at close to $77, oil price showing fatigue along with many other commodities, $5 trillion parked on the sidelines, Greenspan off to Cabo...stocks are underpriced relative to bonds by some 35%.
Back up the truck. Big caps put their bottom in last week, smaller caps have some downside risk to possibly lower lows--but not much lower. As they say on the Street, BUY ON ANY WEAKNESS!
Monica, grab my pole. We're goin' fishin'.
uhh Larry it sells papers thats why. Watch your local news -- the murders get all the ink not the feel good story about the kids visiting the nursing home.
its a reality of our times not a conspiracy ...sometimes you just need to accept things just arent going your way. SOme other cheerleaders like yourself but at my kids high school just shed a few tears and hug each other --maybe you should try it?
Yeah Larry, the glass is half empty. What the hell are you so upbeat about? Look out, here comes another chunk of sky, duck. Didn't you ever hear of Post Election Selection Trauma, or PEST...want a hug Larry?
P.S. For the arithmetically challenged, the current S&P of 1157 divided by 77, it project earnings 12-months out, is 15X not 17X. DHUUUUH!
Hugs and kisses, Larry. Take 2 asprins and call me in the morning.
Great program, Larry! Democrats just WANT Bush to fail in his policies and in the abscence of bad news, the liberal media manufactures them. Gone are their claims about the inaability of the Bush presidency to create jobs. Bush's fiscal stimulus, "benign neglect" of the US dollar and Greenspan's monetary stimulus saved us from the mess that Clinton handed over to Bush. We are well on our way to a multi-year economic expansion that is propelling corporate profits and personal incomes to unparalleled heights. Go Bush! Go Larry!
I'll say it again: There wasn't much mention of alternative fuels. In fact, there seems to be little emphasis on this silver bullet. I believe that while congress limits the use of alternative fuels, our economy will continue to slow. The proposals for use of ethanol are far too conservative. We have had bountiful harvests year after year and less and less exports due to a rise in the self sufficiency of foreign countries. There is no time to waste, get tanked on ethanol!
http://www.ethanol.org/talkingpoints.html
http://www.ethanol-gec.org/memgov.htm
Alex Tabarrok is an Ivory Tower FOOL! The price of Gasoline doesn't matter. Personal Accounts don't matter. His Tenure matters. BS, bs, bs
Larry,
Your getting your hip replaced in July. Did you see 60 Mintues last week and Dr. Vijay Bose in India who does hip resurfacing. The doctor claims it's better then replacement and he does it for about $6,000. Heck, most of the doctors in this country are from India so why not get a better surgery for less and take a vaction.
kudlow has no shame. when GDP is high, it's great. when it's lower, STILL GREAT. when you exclude just about everything that is possibly going up, CPI is low. lower than low!
The MSM has been harping on anything negative in the economy since Bush took office. When the MSM can't find something negative, they do as dannyboy and cbs did with the TANG memos, they will create it by adding or omitting facts.
During the last election, the MSM continued to harp on their "created negative" economy, all in hopes of discouraging the American public, creating a real drop in the economy and thus pushing kerry into The White House.
On a global scale, the MSM basically hates US owned companies. Their choice would be to see all major companies in the US bought by foreign companies; companies that would eventually change the "capitalist driven" US economy.
The best way to describe the MSM is Organized Hatred of GOD, Country and the Capitalist Economy.
(During the last election, the MSM continued to harp on their "created negative" economy, all in hopes of discouraging the American public, creating a real drop in the economy and thus pushing kerry into The White House.)
it wasn't the fact that it was the worst recovery in almost 70 years? or the fact that this economy is a house of cards based on ultra-low interest rates and extraordinarily high debt/GDP?
The MSM has lost all credibility a-la 60 Minutes--they are toast and irrelevant.
With 14 consecutive quarters of GDP growth , and the last 8 quarters fluctuating between pretty darn good and dynamite, they did America a diservice--they helped keep some 49% both stupid and poor. We have all-time record-high household net worth, employment, corporate profits, household incomes, consumer spending, home ownership, and the terrorists on the run. The Bush boom is only getting started; stocks are near record low valuations and are building the bottom for a 2006 lift-off.
The MSM crowd is a dumb crowd that only talks to themselves while blowing smoke up each other's ass. This sorry glass-half empty bunch is losing the battle for the heart and soul of America--we own 2006!
We have all-time record-high household net worth, employment, corporate profits, household incomes, consumer spending, home ownership...
You forgot to mention all-time high record exports.
coupled with huge trade deficits. of course corporate profits are good, Americans are overconsuming on a massive scale. we run trillion dollar deficits. we're in debt over 300% of GDP. we have no savings. for crying out loud, we've got people underwater on their car loans.
if the US economy is so great, why does it need to be financed so much by the saving of other nations? why do we have so much debt? why don't we have any savings?
You are beginning to contradict yourself John Law! You want Americans to save more money? Okay! How about BIGGER TAX CUTS and Social Security Savings Accounts! How about if I get to keep more of my dollars so I can open a second or third ING Account.
( How about BIGGER TAX CUTS and Social Security Savings Accounts! )
that will just make things worse.
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because of the $660 billion increase in real net imports. But that’s a sign of strength.
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Great idea; let's have a $15 trillion increase in real net imports just to show we're the baddest boys on the block.
Who really believes this stuff?
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although 3.1% was lower than expected, it was still OK.
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Wow; looks like you didn't understand your own post regarding higher order derivatives.
Can't say I'm all that surprised, just disappointed.
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Gone are their claims about the inaability of the Bush presidency to create jobs
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Technically, I guess you're right since he's probably created 2 jobs, not 1 job.
The really depressing thing is that as long as the Republicans are convinced everything is peachy, nothing will be done to undo the damage they've done to this country.
You're living in 1928, and you guys love Hoover.
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How about BIGGER TAX CUTS
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Perfect; let's totally eliminate the FICA tax.
Republicans should eliminate the filibuster, pack the courts, slash social spending, force through additional tax cuts for the rich, impose creationism on our public school systems, and cut SS benefits.
Then in 2006 they can run against Democrats as obstructionists who stood in the way of their utopia.
Larry -- maybe you should try to talk a lot louder and jam more ideas down your viewers throats. the viewers are all stupid anyway-- thats why you have to march guest after guest and person after person who agrees with you.
Your viewers cant think for themselves and wouldnt benefit from hearing the other side of things. Like Larry Summers said and you agreed with -- women especially dont have the aptitude to understand certain subjects. And when things go wrong be sure to blame the MSMedia, Congress, DEMOCRATS, and heck even Greenspan ( he's not on the team.)
I really like it when you phrase your questions as a long-run on statement filled w/ hate towards democrats and then ask your hand-picked guests "isnt that right ?"
Thats the way to make change in this country --your the best and very patriotic. It must be tough though to get people who agree with you constantly but keep up the good work. People who disagree with you are bad people. Like the time when you had Deepak Chopra on the show --that was a colossal disaster.
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And business drives the economy.
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I always thought it was consumers who drove 2/3 of the economy; businesses just respond to consumer demand. No demand, no businesses.
But putting that aside, let's assume your statement is true; what are the repercussions for the US if the businesses you allude to are in China?
Why is it that Republican politicians seem to think the economy is going gangbusters while Republican CEO's are cutting business spending?
Curious, no?
Oh, and to the comment about job creation: how many private sector jobs were created in four years of the Bush administration?
Not a stat we see much on cnbc or Faux News.
Larry, who are some of these people commenting here? Youa re on TV and they are not. i wonder why that is??
I wrote a piece in my blog today about Robert B. Reich and said that He is sounding more Kudlowesque! I love your stuff.
Havew a look at my piece. I am not that great a writer, though.
http://madjaymon.blogspot.com/
Just out of curiousity; wouldn't cutting benefits give SS an even worse return on investment?
I guess the SS ROI isn't a top priority for Bushco.
From ThinkProgress:
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Bush is now defining people who are "better off" as anyone earning over $20,000/year. When selling his tax cuts, he defined people who were the "lowest income taxpayers" as anyone earning under $100,000.
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Also, isn't it funny how estate taxes are decried as immoral while defaulting on the SS trust is A-OK with the Bushists.
And here I thought they were against moral relativism.
I THINK 89er AND LAW ARE THE SAME MOOONBAT POSTERS....I SIMPLY CAN'T BELIEVE THAT 2 DIFFERENT FOLKS COULD POSSIBLY BE SO EQUALLY STUPID.
Republican CEOs cutting capital spending: "Take me to your leader, our space craft has just landed from Mars."
Stay short the Qs and start drilling for oil, MOONBATS! BBWWAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
The notion that imports should be added into GDP is ridiculous. It's DOMESTIC PRODUCT. Maybe you could figure out a way to calculate the American foreign subsidies. However, Kudlow's claim is still ridiculous. He;s always looking for some obscure reason to make up for the fact that the economy is much worse than he always makes it out to be.
THIS IS THE SILVER BULLET!
There wasn't much mention of alternative fuels. In fact, there seems to be little emphasis on this silver bullet. I believe that while congress limits the use of alternative fuels, our economy will continue to slow. The proposals for use of ethanol are far too conservative. We have had bountiful harvests year after year and less and less exports due to a rise in the self sufficiency of foreign countries. There is no time to waste, get tanked on ethanol!
http://www.ethanol.org/talkingpoints.html
http://www.ethanol-gec.org/memgov.htm
Larry, who are some of these people commenting here? Youa re on TV and they are not. i wonder why that is??
I wrote a piece in my blog today about Robert B. Reich and said that He is sounding more Kudlowesque! I love your stuff.
Havew a look at my piece. I am not that great a writer, though.
http://madjaymon.blogspot.com/
Hey Glenzo, you don't have the power to cut Larry's taxes, so he doesn't give a damn about you or your blog.
FARMER JOE; thanks for a "CONSTRUCTIVE" comment. People talk about no new refineries being built. THEY IGNORE THE TWO (2) "NEW" ETHANOL REFINERIES being built in Illinois, alone.
No new gasoline refineries are being built, because; they ARE NOT NEEDED!! We have not had a "Shortage" of Gasoline in the United States since the oil embargo.
Goldman and the Speculators are playing us like violins on this one.
Farmer Joe said:
THIS IS THE SILVER BULLET!
Labelling any solution as a "silver bullet" is a sure sign that it's either a scam, or overhyped, or both. At the very least, you're guaranteed to put off people who might otherwise be tempted to take you seriously.
Oh, and I'm in the "both" category as far as ethanol is concerned. Overhyped because it's not cost-efficient enough for practical consumption, or cheap enough to overcome massive switching costs for consumers; and a scam, because agriculture lobbyists keep pushing for it while ignoring that fact.
Unbeliever, you might want to go to the web-sites the Good Farmer put up. They deal with the cost of Ethanol. BTW, we used 500,000 bushels of corn in the production of Ethanol last year. The number will almost certainly continue to go up.
Look, it you're long oil, That's Fine. You might be on the right side of the trade. A lot of people think you are. BUT, DON'T DRINK THE "KOOL-AID!" Be ready to bail if common sense tells you the trade has gone south.
I dreamed of the future last night. It's 2010 half way through Hillary's first term and the evil, ugly Bush economy is nearly a memory. John Law, Howard and ol' 89 have come out of their caves where they weathered the final days of Bush. Blinking at the sunshine they busily dug up the thousands of mayo jars where they buried their cash and now, like PINKY & THE BRAIN, they are ready to TAKE OVER THE WORLD!!!!
Then I awoke and realized that actually those brave little typers just wrote negative horse hockey all day long on Mr. Kudlow's blog comments and didn't do anything about their finances. They stayed long when they should have been out. They were out when the rally started. They bought oil stocks when they were sliding and they got poorer and poorer and blamed it on Bush, Cheney & Larry. Whining daily-- doing nothing. And Rufus et al, don't worry, Prez Hillary was just an undigested piece of pizza that caused my nightmare.
Was she wearing a black leather slit-dress and 4" Spikes?
You must quit eating pizza for dinner, or get on the Prilosec. Dreams like that just aren't healthy.
Rufus: "We have not had a "Shortage" of Gasoline in the United States since the oil embargo."
Actually, we import refined gasoline. Which if you stop to think about it is an amazing thing. We definitely need to build more refineries and we need to relax the boutique recipes for different gas blends. That would help on the margins. Ethanol is a welfare program that has more to do with winning the Iowa caucases every 4 years than good science. It costs more to make and handle than it can be sold for and is a part of driving up the cost of gasoline.
MoneyDarts; It's not "Amazing." It's cheaper to produce (refine) Gasoline in Mexico (for example) than it is in the U.S. As for price; you were right 5 yr.s ago, but the economics have changed.
Again, I "STRONGLY" recommend you go to the two web-sites Farmer Joe listed. I mentioned the two Ethanol Refineries going up in Illinois, but they are springing up like weeds all over the U.S. The game is slowly (or, maybe, not so slowly) changing. BTW, Ethanol gets a $.05 (five cents) break on the Federal Excise Tax. That's not much of a Welfare Program.
Blogging comments leave alot to be desired.
Blog commentary needs to have a structure like message boards with features like threads and ignore. Otherwise it becomes just another waste of internet time trying to filter through to intelligence.
89 seemingly wants to dominate with multiple comments essentially consisting of inane commentary directed, near as I can tell, to himself.
john law seemingly wants to dominate the discussion by ignoring reality, i.e. facts, which conveniently allows him to spew his leftist hatred of the US psychosis.
It is real shame. Because LK has been proven to be highly accurate in his economic commentary on CNBC and K&C. This forum could have been an excellent means of expanding our wisdom. Maybe a web page rather than a blog might work better for LK.
Other thoughts: GM is infected with a severe case of the Japanese virus. Its sick, inefficient, unprofitable manufacturing division is being subsidized by the Bank of GM. As long as the subsidy continues the necessary fixes will not happen.
The only viable solution I see is GMAC and GM separating. Otherwise, GM can stumble and bumble along for another 20-40 years losing auto market share, waiting for all those un-layoff-able UAW workers to retire, and closing plants. The only real question under that scenario is whether the Bank of GM can maintain enough profitablity to cover its manufacturing losses. Or will the entire structure collapse before they either become an efficient profitable manufacturer or cease manufacturing altogether?
Here's the thing, MoneyDarts; I don't think the "Oil-Bulls" are wrong. THEY'RE JUST EARLY! They're early in the same way Qualcomm investors were 5 yr.s ago, and ETHANOL investors were 8 years ago.
Even though I don't think $55.00/gal is the right price, today; it will be the right price in the (maybe not too distant) future. It looks to me like Ethanol really comes into it's own at that price, and, to some extent, starts to put a floor under the price of gasoline.
Hence, it seems like a really good time to start cultivating (in more ways than one) better relations with Brazil.
Who is the largest oil derivatives trader in the world?
Goldman Sachs.
Who forecat an oil spike to $105?
Goldman Sachs
Name one Wall Street firm that has been on both sides of the same trade?
Goldman Sachs
Could a $105 oil-spike projection by a hired hand give an oil derivative trader an advantage if he knew it was coming out of a powerhouse firm?
DHUUUUUUUUUUHH
I'll place my bet with Lee Raymond, CEO of Exxon-Mobile who recently said that "the present high price of oil can not be justified were it not for speculation."
Meanwhile, oil inventories are surging to new record levels every day--a very reliable inverse indicator of the prospective price of oil.
MY LOCAL NEWSPAPER'S LEAD EDITORIAL MADE 7 REFERENCES TO
"CUTS" AND "REDUCTIONS" IN S.S. BENEFITS AS PER THE NEW BUSH/POZEN PLAN.
I wrote the editors a letter of congratulation if their intention was to keep their readers both stupid and poor. There are no benefit "cuts" and "reductions" in the Bush/Pozen plan, just a slowing in their future rate of growth. And this very same slowing of the rate of benefit growth might be offset by participation in American capital markets via private accounts.
My newspaper's solution for saving S.S. was to increase the retirement age to 68 while increasing the witholding ceiling to $100,000. I reminded them that collecting later and paying more for the very same benefits is more of a cut than reducing the rate of growth of said benefits.
My local newspaper made no reference to any faxes on this subject that it may have received from a Texas-based Kinkos.
The MSM has lost considerable credibility, and they will gradually lose advertising dollars. They are losing control of their monopoly on the production and distribution of information and news. And they are about to shrink as yet another relic of the Industrial Age that peaked out in the mid-1960s. They are going the way of the steel and auto industries, displaced by the age of technology, information and intellectual property. There is no turning back.
LET THE MOON SHINE IN!
http://www.e85fuel.com/
TOMORROW'S REFINERIES:
http://www.census.gov/prod/ec02/ec0231i312140.pdf#search='distilleries%20in%20the%20u.s.'
LET US NOW SING "MY OLD KENTUCKY HOME". LMAO
CG; My son is a young (29yr. old) professional person who is fairly well-informed. I'll bet you he hasn't read a newspaper in 5 years. Nor has he watched a news program on TV. He gets 100% of his news off the internet.
I don't think he's atypical of his demographic. Now, for the Bad News. Yahoo, where I'm going for more and more of my news, seems to be tilting a bit to the left itself. I've begun to notice a fair amount of editorializing-type comments in their "News Stories."
Now What?
Mr. K should revisit his economics lessons from Princeton U. I write this because, yesterday, when commenting on the release of disappointing first quarter GDP numbers, his ridiculous argument in favor of changing the way GDP is calculated, revealed a lack of understanding of what this basic economic statistic is attempting to measure.
In his words, "imports are not a bad thing" so why subtract them from GDP. As a result of his recalculation, Kudlow argued, with a straight face I might add, that the real growth rate of the U.S. GDP during the first quarter was in fact a far more robust 5.29%.
While it may be true that imports per se are not bad, it is also true that they have absolutely nothing to do with GDP which is precisely why their value is subtracted from the calculation in the first place. The concept of GDP is to measure the value of goods and services produced by a nation. Since all goods and services produced are ultimately consumed, the index is calculated by totaling the expenditures made by individuals, corporations, and governments, (I + C + G). However, since goods produced for export are not consumed domestically, the value of exports is, therefore, added to GDP. If this adjustment were not made, the value of such production would go unmeasured. However, since expenditures on imports do not reflect domestic production, the value of imports is therefore subtracted from the calculation. The net result is GDP, or Gross Domestic Product.
Also, Mr. K, being an inflationist at heart, seems to overstate a decline in the daily gold price, but ignores the fact that gold regained it's losses last week AND ROSE AGAINST MOST MAJOR CURRENCIES.
I wrote the editors a letter of congratulation if their intention was to keep their readers both stupid and poor. There are no benefit "cuts" and "reductions" in the Bush/Pozen plan, just a slowing in their future rate of growth.
Oh please. And when the Republicans were referring to the Democrats call to eliminate future tax cuts as a "tax increase", you were also writing letters to the editors?
What i find amazing is Bush is trying to solve a future problem where benefits will potentially need to be reduced by 30%. And his solution? Reduce benefits by 65%. Brilliant.
RED, ITS THE SAME IN MY FAMILY AS WELL. We all gave up on the MSM years ago, I glance at my local propaganda rag primarily to read the letters to the editor section (and sports). I read those letters just to be reminded how poorly informed, and outright stupid, the public really is. And we know who put them in that sorry condition; but they keep on going back for more.
Most recently, particularly as it relates to their anti-Bush/Posen plan, the MSM has reminded me of Orwell's 1984 "Newspeak" in which "more is less, less is more and some are more equal than others." The MSM's socialist agenda brings new meaning to words. I have no use for this, and that's why "I voted for it, before I voted against it."
No trout fishing for the past week, I'm getting cabin fever. Snow, snow and more snow!
For the those not suffering from MSM inducced brain damage, may I suggest:
"The Collapse of Big Media: Starting Over" by Terry Eastland as printed in The Wilson Quarterly. It can be accessed via Real Clear Politics with one simple click.
A great read on what went wrong with the MSM and how the blogosphere, cable and talk radio picked up the ball and ran...the end of a monopoly!
I learned more about Ethanol, and the role it might play, yesterday; following Farmer Joe's links, than I have in a life-time of following MSM.
Thought: Wouldn't it be great to have a blog site where intelligent people met to exchange and discuss IDEAS.
The trick would be to reach a tipping point; where thoughtful people began to out-weigh the KOOL-AID EMBIBERS (from both political sides.) On the other hand, all opinions would have to be tolerated (embraced is better.) I think it would be a Hoot.
READ THESE ARTICLES AND REALIZE THE YEARS OF MANIPULATION.
http://www.msnbc.msn.com/id/5829046/
http://www.greencarcongress.com/2004/10/flex_fuel_zooms.html
http://www.fueleconomy.gov/feg/flextech.shtml
3 more EXCELLENT LINKS, Farmer Man. Thanks a ton. I have to admit, it's eye-opening. While the politicians talk and dither, the free market gets it right.
Wholesale price of Gasoline, $1.50/gal. Wholesale price of Ethanol, $.90. Gentle-people, this is turning into a no-brainer. Watch for more states following the Minnesota lead ( mandatory 20% Ethanol.)
The obfuscating and obstructing oil companies aren't going to like it. Look for future articles in MSM connecting the use of Ethanol to various forms of Cancer, Genital Herpes, Impotence, Bad Breath, Poverty, and General Unhappiness.
This post has been removed by a blog administrator.
The "MSM" doesn't even mean anything. That's just an idiotic, paranoid construct. Start breaking it down a little into broadcast and print, into radio and TV, into cable and network, and THEN maybe you can start meaningfully examining what the hell the problem is with economic reporting.
Look. Economics is complex, the structure of info dissemination is complex, and Larry (excuse me, you're NOT part of the MSM??), you seem to want to simplify both into chewable, sound-bite-sized sized pieces with a little emotional charge on them. That's fine, and it's good fodder for guys like Melnick who don't really understand, but want to be able to keep going around sounding like (and feeling like) they do, but it's really not very instructive, is it?
The MSM? C'mon Larry, 'fess up. You use the snazzy-but-worthless "quote 'em" better than most. Sheesh.
HERE'S ANOTHER GOOD ONE FOR LITTLE LARRY KUDLOW FROM HIS FARMER FRIENDS. 'CAUSE WE LOVES YOUS, LITTLE LARRY!
http://journeytoforever.org/ethanol.html
YOU CAN TAKE THIS TO MAIN STREAM MEDIA, LARRY:
http://www.ilcorn.org/update/html/4-18-05.html
FarmerMan; the journeytoforever link is eye-popping. GREAT LINK! FarmerMan is onto something here folks. There's got to be a buck to be made here, somewhere.
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89 seemingly wants to dominate with multiple comments essentially consisting of inane commentary
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And Walt replies with his own unique observation that GM is a sick company.
What a novel insight; I believe we stand in the presence of greatness.
This Kudlow guy is such a rightwing tool. John Law is so right. If things are good, Kudlow says they're great. If they're bad, Kudlow blames the media for reporting it!
The f*#king right-wingers, any media outlet that doesn't say what we want is "liberal-controlled media", any judge who doesn't do what we tell him is "activist on the bench", anybody who disagrees with tax cuts for the superwealthy while everybody else gets trashed "hates America and our soldiers".
Why are you people so stupid? I understand if you're rich and you just want to rape the rest of America like Kudlow and the big money crew, but those of you who aren't rich, you ought to take a minute and think about whether these Republican f*#kers in Washington are doing anything, anything at all, to help your life.
If you want to know the origins of the MSM's business bias, go here:
http://www.bizzyblog.com/?p=138
Handouts?
Why do people want handouts? Have we become too lazy? Socialists encourage laziness...capitalists encourage the "go getter" attitude...
Ok, not all Dems are socialits and not all Reps are capitalists.
What side do you want to be on?
Me, no more handouts lets motivate...
Handouts?
Why do people want handouts? Have we become too lazy? Socialists encourage laziness...capitalists encourage the "go getter" attitude...
Ok, not all Dems are socialits and not all Reps are capitalists.
What side do you want to be on?
Me, no more handouts lets motivate...
CapitalGain; I think you just might have gotten "Lucky" in your youthful exuberance, and called the "Bottom." I'm not Buying, yet; but if we can keep "Oil" under $50.00/gal. and get a decent inventory report Wed.; I just might buy a few shares, myself.
LARRY: Let's get somebody on K+C to talk about ETHANOL. This "Oil" trade needs a little talking from the other side. I think there might be a "Quiet Revolution" taking place all over this country (world: Brazil, for ex.)
These Ethanol refineries that are popping up all over the country are small, privately-owned enterprises, and are not generating the publicity that they might deserve.
Remember, when I called for the April 20 bottom, I made that call for the bigger caps, not the smaller caps--they have more work to do...With Q1 profits up 19% versus the 7-8% consensus gain forecast as of last December, I think my ship is in--we should get a 2-month rally before Q2 earnings fears surface. The high-priced GURUS were off by only 150% with their Q1 earnings projections; they will likely be off by 75% for Q2. Financials, info tech and undust. earns. were up 18-25%--we didn't even need the oils.
Commodities are showing fatigue across the board. Gold is beginning to look a little like tapioca and the only place you are going to find $105 oil is on Wall Street.
Just remember, CG; The oil market is not trading "Rationally." If you get another Flakey inventory report like we did 2 wk.s ago, with draw-downs in both crude and Gasoline, it's time to go fishing. In fact, any quirkiness, whatsoever, in the report and it's time to hit the sell button.
I'm sure the refineries are operating off of their inventories; letting the price of oil drop before they step in and start buying. This should lead to another build in Crude. I think the double draw-down two weeks ago might have been connected in some way to the inversion in prices between Light Sweet and Brent. Just guessing.
The "Oil Bulls" are still out there, and they're awfully strong. You can bet you're going to see pictures of some burning, Iraqi, pipeline all over your TV screen in the next day or so (despite the fact that the pipeline in question hasn't carried any oil for 2 yr.s.)
Or that it carries oil to some local refinery that makes gasoline for Samarrah or some such place.
Of course, there will be the obligatory story about a looming strike in Nigeria, and a veiled threat by Chavez to sell his oil to Equador, or Antarctica, or Palau, or his grand-mother, or what-ever. LOL
The point is CG; Goldman Sachs is an EXTREMELY STRONG outfit. While they may not be powerful enough to completely "Repeal" the laws of "Supply and Demand," they are certainly capable of keeping'em "Bottled up in Court" for a considerable time. Be nimble!
If you look at our SPR and non-SPR inventories, they have gone straight through the roof. They are at exreme record highs and we are within 10 mil bar. of the SPR max of 700 mil bar. We will hit the SPR max in July and the monster SPR buying will be forced to conclude--the caves are full. More importantly, the price of crude has had a very powerful inverse relationship with the size of OIL inventory. Exxon CEO, Lee Raymond, is right--speculation has caused the recent spike, not demand. We are awash in oil. ITS GOING DOWN.
BE NIMBLE!! Rationality can get you broke in an "Irrational" market!
And as the world economy cools, that should take the edge off of oil demand in the short to mid time horizon.
And when the next up-cycle begins, we'll find out exactly how much oil reserves the world really has; if it's there, the next up-tick will pull it out of the ground.
If it's not, think I'll install a coal furnace. :-)
89'er: You haven't weighed in on Farmer Joe's Ethanol story. I'm surprised. What's your take?
My head starts to spin on ethanol (hmmmm, no pun intended); the republicans seem to hate it and see it as a boondoggle, some on the left like it.
There are a number of choke points; I read a report by a biologist that said there's not enough solar energy in the midwest to replace 100% of our oil use (ie, watts of sunlight * surface area of arable land * conversion efficiency of chlorophyll * fermentation efficiency).
We have water issues since a lot of our corn is raised by irrigation from deep aquifers, and we're aparently drawing them down faster than it's being replaced.
Farming is actually a fairly petrochemical intensive industry because of mechanization, fertilizers, etc.
Fermentation also produces lots of greenhouse gases like CO2.
So I guess I'd like it to be part of the long-term solution, and I'm cautiously optimistic, but I'd like to see a full and serious analysis by folks without an economic or political axe to grind.
But I don't know if people like that exist when you start looking at these hot-button issues.
I think our best long-term option is probably nuclear, as soon as we can find a ditch to bury the waste in.
Too bad cold fusion turned out to be less useful than we first imagined. They actually got room temperature fusion working last week, but it was negative net energy, and was only really useful as a compact neutron source.
Case in point, CG. Boone Pickens is on TV today calling for $3.00/gal. Gasoline this year. That would require $85.00/barrel oil. Everyone knows the old .....umm .. Speculator's wealth is hugely leveraged to the price of oil, but he'll be all over TV the next couple of days. The fact that his statement is TOTALLY OUTRAGEOUS guarantees that it will be played over and over.
AND, IT WILL AFFECT THE MARKET!!
T. BOONE FOUND MORE OIL ON WALL STREET THAN HE EVER FOUND IN THE PATCH...so I wouldn't be a bit suprised that some of his public statements to the media may be more than just a little self-serving. T. Boone is one of those very same speculators (along with the hedge funds) that Exxon's Lee Raymond was talking about.
But that won't make anyone right. I'll go with the long standing relationship between supply, demand, inventories and prices. And the massive inventory build that began in late-2001 is at the cusp of ending.
Take a look at some commidity charts--they look like they are in the 15th mile of an uphill marathon. THEY ARE SHOWING SIGNS OF GOING TAPIOCA ACROSS THE BOARD.
WHAT ARE YOU SAYING, 89'er?? That Politicians favor BIG OIL COMPANIES over small town Co-ops?? Absurd!! I've never heard of such a thing.
I don't think the most deranged Ethanol advocate would ever suggest that we could derive all of our fuel needs from Ethanol. However, knowing that you could drive your hybrid vehicle 45,000 (yes, I said 45,000) miles off of ONE ACRE of Sugarcane or 3 acres of Corn piques my interest. AND SAVE $ A THOUSAND DOLLARS DOING IT!
BTW, it doesn't take much energy (other than the human kind)to farm one acre of sugarcane. I really recommend those links that FarmerJoe put up. You have to type them in, but they're worth it.
Hmmm... falling commodities... flattening yield curve... decelerating growth in GDP... flat job market... lackluster ISM... and now we're even running a trade deficit for agricultural products.
Welcome to the Bush Boom!
Hmmmmmmmmmmmmmmm....looks familiar; I've seen this before--looks a lot like 1994-1996.
Hmmmmmmmmmmmmmm....wonder how the market did after it consolidated in 1994 and discounted the very normal mid-cyle slow down.
Hmmmmmmmmmmmmmm...Anyone have an old chart book lying around?
Hmmmmmmmmmmmmmm....
Well, CG, Boone has pushed oil up over $50.00 again. I'm telling you, those oil bulls are powerful. They're fighting for their lives. Fortunes are involved. We should be seeing the Burning Pipeline any time now.
FLASH: New Technology: A group of scientists at Ole Miss have perfected a way to make Ethanol from KUDZU by burning Water Moccasins.
Mississippi Rufus' home is now estimated to be single most valuable property on earth, exceeding the combined value of all Saudi oil fields by a factor of 1000.
Rufus states he is going to spend all of his new-found wealth to buy a new lap-top with approx. the same resolution as 89'ers.
re ethanol; I guess I'll be a true believer when I start seeing all of the industrial farming companies converting to ethanol.
Until then, I'll probably remain a bit sceptical.
DOE pdf on biodiesel
How many acres would America have to farm for corn to produce Ethanol toward satisfying our need for foreign oil, considering the fact that we import some 12 million barrels per day? And considering the amount of land that would be needed, do you think the radical environmentalist wouldn’t oppose Ethanol too. We are damn by them no matter what we do, oil or ethanol, domestic oil or import oil, clean coal or nuclear. They are not for the environment; they just want to undermine America. Radical environmentalist are just another branch of the ACLU, they want to weaken America on all fronts.
Larry,
I have no idea how you can look at yourself in the mirror and not be revolted. The level of dishonesty is amazing. Every other respected market news source (Bloomberg, Briefing etc...) all mentioned the possibility of a slowdown in the economy. Yet, you remain to your bullish story.
If the economy is so great, please explain why the market indexes down for the year? Are all those traders in the pits wrong while you are right?
Considering the US government is indebted 7.8 trillion, consumer debt now comprises 85% of GDP and has doubled in the last 4 years, mortgage debt is also up 100% in the last 4 years and mortgage debt is now a larger percentage than home owner equity on a national basis, how the hell can the consumer continue to spend? By the way, all those figures are available from the Federal Reserve Website. Feel free to label them liberal taking points and ignore reality for awhile longer.
What scares me is people actually think you know what you are doing. You still remain one of the greatest contrarian indicators in the market. Keep lying.
Read this article About ethanol and it can also be apply to biodiesel.
http://www.usatoday.com/tech/columnist/andrewkantor/2004-02-20-kantor_x.htm
We usa about 75 million acres for farming in American today, if we grow corn or soy for ethanol or biodiesel we would need to add some 270 million acres of land.