Magic Growth Numbers
Paul Craig Roberts
December 26, 2014
Everyone wants good news, so the government makes it up. The latest fiction is that US real GDP grew 4.6% in the second quarter and 5% in the third.
Where did this growth come from?
Not from rising real consumer incomes.
Not from rising consumer credit.
Not from rising real retail sales.
Not from the housing sector.
Not from a trade surplus.
The growth came from a Bureau of Economic Analysis survey of consumer spending on services. The BEA found that spending on Obamacare drove the US real GDP growth to 5% in the third quarter. http://www.zerohedge.com/news/2014-12-23/here-reason-surge-q3-gdp
In America, unlike in other countries, a huge chunk of medical spending goes to insurance company profits, not to health care. Another big chunk goes to paperwork, which has a variety of purposes such as collecting personal information on patients and combating fraud (probably the paperwork costs more than fraud). Another chunk goes for tests and procedures in order to justify further procedures. For example, if a doctor thinks a patient’s diagnosis requires a MRI, he must often first order an x-ray to establish that a cheaper procedure does not suffice. If a cancerous skin growth needs to come off, first a biopsy must be done to establish that it is a cancer so that a needless removal is not performed. And, of course, medical practicians must order unnecessary tests in order to protect themselves from the liability of relying on their medical judgment.
To regard any of these expenses as economic growth is farfetched.
There are sampling and other problems with the survey of personal consumption, and apparently Obamacare spending was all dumped into the third quarter. Why the third quarter?
Exposed – Dangerous 2015 Ahead As Global Governments Plan To Steal Money
Today a 40-year market veteran sent King World News an incredibly important piece that exposes global governments and their treacherous plan to steal people’s money. This piece exclusively for KWN also cautions readers around the world to expect a wild and dangerous ride in the coming year.
By Robert Fitzwilson of The Portola Group
December 29 (King World News) – In mid-December, the U.S. Treasury finalized the rules for what looks like a fairly innocuous addition to the retirement plan menu, the so-called “myRA”. We say “finalized” with a wink as we all know that what has been promulgated is simply the proverbial camel nose under the tent. It looks benign and even positive, but the program clearly has the agenda of redirecting the retirement savings away from the current IRAs and other plans enjoyed as the primary savings vehicle for most Americans.
The target has to be the near $20 trillion of retirement assets in the United States. The final incarnation of this retirement model will most likely be adopted globally by other governments, so those living outside of the U.S. should pay heed as well….