Kevin Phillips, noted political strategist and economics commentator has a new article in the Huffington Post that is tantamount to damning evidence about our current economic State of Affairs.
Billionaire California bond manager Bill Gross calls it "a haute con job." Bloomberg News columnist John Wasik describes it as "a testament to the art of economic spin." More and more shoppers and consumer simply disbelieve it.
The subject of this scorn is the federal government's vaunted Consumer Price Index or CPI. Americans are now beginning to understand that this indicator has its own share of gimmicks not unlike a sub-prime mortgage or the six pages of fine print that accompanies your credit card agreement.
How does Mr. Phillips say this? He says just at the price of commodities, Oil and food have skyrocketed - 80% and 40% respectively, and in my estimation yet wages are completely flat as well. He points to the financial press, such as Bloomberg amongst others who quietly point out how foreign investors are suspicious of the dollar.
But what can we do about it? In a perfect world Mr. Phillips suggests: In theory, a vigilant Congress might want to hold hearings, but in practice I suspect not. Democratic presidents (notably Bill Clinton) have been involved in the numbers game along with Republican administrations. Neither party has clean hands. Far more likely that any serious investigation will be mounted clandestinely by central banks or sovereign wealth funds in places like China, Singapore and Saudi Arabia as part of their ongoing study of just how much longer they can continue to support a deteriorating U.S. dollar. It is not a happy prospect. Sphere: Related Content
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