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Do figures lie, or do liars figure?

August 7, 2019
Lehigh Acres Citizen

To the editor:

It is more than a little disturbing to observe the sales tactics, and the source of the information being used by stock brokers to create dramatic fluctuations in the U.S. stock market. First and foremost, their motive is monetary. Stockbrokers only earn money when stock is being bought and sold, both on the way up and again on the way down. This makes it in their best interests to repeat this process as frequently as possible. When one "churns" milk or cream, one makes butter. When one "churns" stock, one makes large commission checks.

What is more than a little scary is to delve into the techniques used by our government, specifically the U.S. Department of Labor Statistics.

It "churns" out the monthly national unemployment rate and monthly estimate of new job creations, both considered to be important benchmarks for stock price movement. The unemployment data is gathered by conducting a telephone survey of 60,000 randomly selected households during the week of the 12th of each month by 1,500 surveyors. They are reported to be "highly trained and experienced Census Bureau employees." This data is then fed into a computer that, via some ingenuous program, extrapolates it into a percentage (%) value! Amazed? I certainly was. Not exactly rocket science, more like government salesmanship to sell flawed information to perpetuate flawed policies.

So much for employment data. Let's review the unstable rise in price levels for goods and services more commonly known as inflation, another major influence on the stock market. The chairman of the Federal Reserve takes great pride in reporting to Congress (monthly), an unrealistically low monthly rate of inflation. His report is what the Fed refers to as "core inflation." This is the actual total inflation minus food and total energy consumption such as gasoline, diesel fuel, heat, electricity, etc. Inflation minus food and energy -amazing! This rate is true only to people eating no food and using absolutely no energy. It would be more appropriately named should it be called a cold-walking-and hungry index. It is outrageous to think we have stockbrokers and heads of major corporations touting this as the final word when making financial and management decisions. It appears as though our government demands we believe the impossible and practice the unfeasible - not unlike it does continuously.

What is most alarming is the fact this approach to mislead the general public works for those involved on a perpetual basis. Or perhaps there really is a tooth fairy?

Robert E. Workman

Cape Coral

 
 

 

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