Wednesday, August 25, 2010

US Employment Figures

After the Dow’s dazzling 77% rally from the lows of March 2009 to the recent high of 11,258 in March 2010, a little “give-back” was to be expected. But a lot of give-back was not expected…at least not by the legions of investors who believed that the Fed had vanquished the credit crisis for good, and had conjured a recovery out of thin air.

So now that this give-back has lasted an uncomfortably long period of time – and now that most economic data are coming in “weaker than expected,” the Dow’s nifty rally off the March 2009 lows begins to feel more like a deception than a validation...

“We may not have said it first,” we declared in the June 30 edition of The Daily Reckoning, “but we have said it repeatedly: The US economic recovery is a myth…a fairy tale.”...

Back in early March, however, most professional economic observer-prophets were still crowing about the end of the credit crisis and the resumption of economic growth. Today, the observe-prophets are trying to shake the fog out of their crystal balls. There is no recovery. Merely less catastrophe.

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