More Bad News For Obama

Retail sales dropped by .2 percent in both April and May. This is not good news. It reflects the idea that the economy is NOT booming and contrary to what the President said "the private sector is doing good."  You can put lipstick on a pig, but it still is a pig. All the dressing up by the White House will not make things any different. This economy is a disaster and no one in Washington or on Wall Street knows what to do.

Every day we see the market either go down on news and then rebound 24 hours later on  stories which were exactly the opposite of the previous days news. This is ridiculous. Either the market is being fixed or Wall Street is manic.  We believe it is both.

As we saw in the Facebook IPO, small investors were not given the information that large wire houses gave their "A" clients.  Small guy gets stripped of his money while the big boys win. That is wrong. Although the market is supposed to be a level playing field, this example shows it is not and anyone playing the game, has to understand that. Unfortunately, most do not. The market is fixed against the small investor, period.

As far as being manic, there is way too much volatility in the market. It suggests to us that day traders and computers are in charge.  Bad news in Greece one day drops the market and the next day it turns around because the news is that Greece has solved its problems. No country can solve its problems overnight which suggests other things are occurring. We would suggest that when the bad stuff comes out, computers and traders dump stock only to turn around the next day and buy at a lower price.  It is just one manipulated market that has no sense of reality.

Agree? Disagree? We love to hear your arguments.

Conservative Tom

RETAIL SALES FALL AGAIN IN MAY

By: John Hayward 
6/13/2012 10:32 AM

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A new snapshot of economic collapse: The Wall Street Journal’s MarketWatchreports “U.S. retail sales fell in May for the second month in a row - the first time that’s happened in two years - as consumers spent less to fill up their gas tanks.”

This led to a 0.2 percent seasonally-adjusted decline in retail sales for May, while April was also revised downward to a 0.2 percent loss, instead of the initially reported 0.1 percent gain.  It’s funny how everything seems to get revised downward these days.

If gas prices are taken out of the picture, May saw the same kind of weak 0.1 percent increase that was first reported for April… at least, it will until the inevitable “downward revision” hits next month.  Much of this was driven by “strong demand at auto dealers and Internet retailers,” according to MarketWatch.  The automobile increase is a bit puzzling, because unit sales actually slid significantly in May.  This would, taken at face value, suggest that auto dealers are selling fewer cars for higher prices.

Poring over the data, MarketWatch detects “a potentially worrisome sign,” which is the loss of sales at “virtually all of the establishments that tend to rely on discretionary income — extra money consumers have left over after paying for bills and necessities.”  This fits with recent reports of declining family net worth, and the dramatic loss of full-time jobs, to be replaced by part-time and temporary work.

These figures illuminate the complex relationship between energy prices, inflation, and consumer demand – a delicate system resolutely ignored by Obamanomics and its suicidal “green energy transformation” ideology.  Gas prices are falling because retail gasoline demand is down.  That’s a very bad sign during the big summer-vacation driving season.  Economic malaise and unemployment anxiety are shifting the consumer economy into a dangerously low gear, as it struggles to climb a terribly steep “recovery” hill.

This news is also a stunning repudiation of the wild rhetoric flung around by the Obama Administration over the last few months, when it was panicking over gas prices, and desperately insisting they were somehow immune to the laws of supply and demand.  That’s why developing American energy resources supposedly wouldn’t affect the price of gas at all, while skyrocketing gas prices were blamed on evil “speculators” by the President.

The corresponding drop in wholesale prices very clearly illustrates the way fuel costs influence the cost of virtually everything we buy.  It also provides a clear warning about the disaster awaiting us, if we give clumsy, politically blinkered central planners ever more control over a high-performance economy they will never understand.  They only know what they want out of the American economic machine, and they’re prepared to alternately kick it and pump it full of unstable “stimulus” and “bailout” fuel until it lives up to their expectations.