The Fed’s Market Myth is Unraveling Before Our Eyes… Bloodbath Coming

By: Graham_Summers

So much for the narrative.

The latest myth being promoted in economic circles is that median income growth exploded higher last year. The people promoting this myth obviously didn’t bother reading the actual report and don’t understand what the word “median” means.

A big hat tip goes to John Williams who actually DID read the report and found that the Census has adjusted its methodology to include what interest income WOULD be if rates were not at zero.

In this manner, the Census was able to claim interest income INCREASED 111% during a period in which the US interest rate was 0.25%.

By the way, the White House controls the Census. It must be complete coincidence that during an election year suddenly the data got so much better based on fantastical assumptions.

Regardless, the report is just the latest in politically driven economic propaganda. This includes the jobs data.

We are lead to believe that jobs are strong and that the US is “fully employed.” Setting aside the fact that 94 million people are out of the workforce, and 46 million are on food stamps, let’s focus on the notion of “jobs.”

When someone gets a “job” that person begins to pay “income tax.” The Government loves this because it funds revenues. Which is why it’s rather off that if employment is indeed rising, income taxes being withheld have FALLEN for the last two years.

Either those “jobs” don’t actually pay income… or the “jobs” don’t actually exist.

H/T Bawerk.net

The data continues to fall apart here as well. The Rockefeller Institute of Government just released a report showing that state personal income tax revenues are rolling over aggressively.

State personal income tax revenues grew only 1.8% year over year in the first quarter of 2016. The second quarter’s preliminary data shows a decline of 3.3%.

If jobs are being created and personal incomes are growing, income taxes should be RISING. They’re not. This suggests that REAL economic growth is in fact MUCH lower than the mainstream financial media narrative.

Stocks have yet to adjust to this. Stocks believe the hype that the economy is growing rapidly and that we are in a recovery. When stocks finally adjust, we’re in for a rude awakening.

Indeed, we believe the global markets are on the verge of another Crisis, triggered by a crisis of faith in Central Banks.

2008 was Round 1 triggered by Wall Street banks. This next round, Round 2, will be even worse as faith in Central Banks collapses.

If you’ve yet to take action to prepare for this, we offer a FREE investment report called the Financial Crisis “Round Two” Survival Guide that outlines simple, easy to follow strategies you can use to not only protect your portfolio from it, but actually produce profits.

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Best Regards

Graham Summers

Phoenix Capital Research

http://www.phoenixcapitalmarketing.com

Graham also writes Private Wealth Advisory, a monthly investment advisory focusing on the most lucrative investment opportunities the financial markets have to offer. Graham understands the big picture from both a macro-economic and capital in/outflow perspective. He translates his understanding into finding trends and undervalued investment opportunities months before the markets catch on: the Private Wealth Advisory portfolio has outperformed the S&P 500 three of the last five years, including a 7% return in 2008 vs. a 37% loss for the S&P 500.

Previously, Graham worked as a Senior Financial Analyst covering global markets for several investment firms in the Mid-Atlantic region. He’s lived and performed research in Europe, Asia, the Middle East, and the United States.

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