While we’re on the topic of fake news… how about we assess the fake economy of the last eight years?
President Obama at one point claimed that those who questioned the strength of the recovery were “peddling fiction.”
It’s an interesting claim given the entire recovery, at least post 2010, has been built on fake economic data to perpetuate a fake narrative of growth.
A few key items…
There is no way on earth that the real unemployment rate is less than 5%. Over 45 million people are on food stamps and over 94 million people are out of the work force. Claiming unemployment is at 5% in the context of these two other data points is like claiming you’re in incredible shape provided you don’t count body fat or cardiovascular health.
Then there’s GDP growth…
The US has yet to achieve a single year of 3% GDP growth in the last eight years. Unfortunately even these weak growth numbers were fake. The US’s economic reality stripped of accounting gimmicks is in fact much worse.
The most obvious gimmick is that of using a low deflator measure for inflation.
Let me give you an example. According to the latest GDP numbers, the latest GDP deflator was 1.11%. This means that inflation was supposedly only 1.11% during the last quarter.
At the same time, the official inflation measure for inflation, the CPI, is 2.4%.
Put another way, inflation is supposedly at 2.4% until it comes time to calculate GDP growth at which time it magically falls to 1.11% so that GDP growth looks larger than it really is.