by
Jim
Karger
The Dollar Vigilante

Previously
by Jim Karger: When
They Come For Your Guns . . . You Will Turn Them Over

My grandmother
grew up in the backwoods of Arkansas.  She had a fourth grade
education and worked in the fields. When she was 12 years old she
threw down her cotton sack and took a train to Texas to live with
an aunt she had never met.  She lived a hard life, never had
much of a chance, and yet she was one of the wisest people I have
ever known.  

She taught
me many life lessons that have served me well, one of which went
like this:  “Jimmy,” she would say as she waved her finger
in my face, “most folks will lie even when the truth works better.”
Not a particularly rosy view of humanity, but it was, and is, deadly
accurate.  

Nowhere is
the truth of her admonition better seen than when man is collectivized
and given authority.  Whether government, corporate or union,
the simple fact is that most people are liars. Liars lie. Good liars
rise to the top. And when good liars are collectivized they lie
more frequently and more effectively.  When they have control
of the numbers, it makes their deceit more difficult to discover.
 When they can make up the numbers, it can make unwinding them
a near impossibility.

Take the recent
unemployment numbers that took the U.S. stock market to fresh three
month highs.  According to the U.S. Department of Labor, 163,000
new jobs were created in July, 2012. 

Sounds good
enough, but like most numbers, even if it is accurate, which it
is not, it creates an intended deceit.  

Looking at
the Bureau of Labor Statistics own tables reveals the following
startling fact:  The U.S. actually lost 1,204,000 jobs in the
month of July, 2012.  Don’t believe it?  Take a look at
the actual unadjusted
data from the Bureau of Labor Statistics.  

During July,
2012, the private sector added a net 27,000 jobs which represented
an added 76,000 goods-producing jobs less 49,000 jobs lost in the
service sector.  The other million plus were lost in the public
sector.  The 163,000 represents a number that has nothing to
do with reality, but rather represents a model that supposedly takes
into account the seasonality of certain jobs.  

In short, the
BLS report showing 163,000 added jobs is statistical wizardry by
bureaucrats with calculators following the demands of liars who
want the numbers spun.      

If you give
it some thought, it makes no sense that employment is expanding. 

GDP is falling,
in part because fewer people are working, which might also explain
why tax receipts per employee are also falling.  A contracting,
not expanding, workforce might also explain these numbers from the
ISM’s July Manufacturing Purchasing Manager’s Index (PMI)
report.  The PMI registered 49.8 percent, which was a contraction
in the manufacturing sector for the second consecutive month, following
34 consecutive months of expansion.  And, the New Orders Index
registered 48 percent, indicating contraction in new orders for
the second consecutive month.

A rising number
of unemployed might also be consistent with:

• ISM’s
  New Orders Index of 48 percent in July, represented a contraction
  in new orders for the second time since April, 2009.
• The Inventories
  Index registered 49 percent in July, 5 percentage points higher
  than the 44 percent reported in June. ISM’s Employment
  Index registered 52 percent in July, 4.6 percentage points lower
  than the 56.6 percent reported in June. 
• ISM’s
  New Export Orders Index registered 46.5 percent in July, 1 percentage
  point lower than the 47.5 percent reported in June, and represents
  the second month of contraction in the index since June, 2009.
• ISM’s
  Imports Index registered 50.5 percent in July, 3 percentage points
  lower than the 53.5 percent reported in June.

The employment
numbers are even belied by garbage, not just the government’s garbage,
but real garbage.  A
recent ZeroHedge blog interpreted Bloomberg numbers on the number
of carloads of trash being hauled by U.S. railroads.  “As Bloomberg
explains:  ‘One closely watched economic indicator is the rail
car loads of waste and scrap materials.’  Logically, ‘The more
we demand, the more waste is generated by that production.’

As the chart
of the day, courtesy of Bloomberg Brief, demonstrates, if garbage
is the benchmark, the US economy is now contracting faster
than it has at any one point in the past 3 years and is on pace
to recreate the economic collapse last seen after the Lehman bankruptcy.

Perhaps another
reason why central planners have latched on to stock markets and
will just not let go.

In the big
picture, the numbers still don’t add up.  The “civilian
labor force participation rate” is now at 63.7% of the total
workforce. The total employment to population rate is 58.4%.  
This puts these rates back to about 1982 (see where blue and red
lines intersect the black line).

See “The
Employment Charade Or Ignore The Headlines” by Jeff Harding
at The Daily Capitalist.    If participation keeps falling
precipitously, does it make sense that jobs are being added and
filled?  
From employment to GDP, government skews the numbers to the favor
of, well, government.  Obama does it, Bush did it, and the
next up in the liar’s list of America’s so-called ‘leaders,’ will
do it, too, and for the same reasons:  to keep the Sheeple
calm, or at least, less-violent.  

And, while
it appears government is lying to its advantage, in fact it is lying
when the truth would work better.  Why?  The lies upon
lies will soon become incredible.  The Sheeple will look around
and see that more, not less, of the people they know – their
neighbors and their friends – are unemployed, and one day the
published numbers will mean nothing anymore and the civil disobedience
will begin.  No doubt the truth would be taken hard today,
but the truth would provide a foundation for solutions that make
sense.  Relentless denial is rarely, if ever, the answer to
any problem.

A good starting
point for anyone interested in parsing government numbers is to
assume that any number publicized by government is a lie.  The
first question to be asked is, “to whose advantage?”  The second
question, “Where is the raw data?”  Then, combining common
sense with a little research you may still not get to the real number,
but you will get closer than the lies being fed to the willing by
the liars who lie even when the truth would work better.

“Getting
Your Gold Out of Dodge” is available here.  It is free
to TDV and TDV
Golden Trader subscribers or for a one-time price of $44.95
USD.  It may be the best use of your fiat Federal Reserve Notes
you’ve ever spent. Reprinted with permission from The
Dollar Vigilante.

August 11, 2012

Jim
Karger is a lawyer, and frequent contributor to The
Dollar Vigilante, who has represented American businesses against
incursions by government and labor unions for 30 years. In 2001,
he left Dallas and moved to San Miguel de Allende in the high desert
of central Mexico where he sought and found a freer and simpler
life for he and his wife, Kelly, and their 10 dogs. Karger’s website
is www.crediblyconnect.com.

Copyright
© 2012 The
Dollar Vigilante