Government Lies Prop Up Stocks

Today's commentary entitled "Hitmen Contracts To Bust COMEX," by Jim Willie says to "give credit to the USGovt statrats in their busy laboratories. They decided to ramp up the Q2 Gross Domestic Product by including all USGovt rescue funds for the big banks, including the diverse funds from the many liquidity facilities. All those funds will go directly into the GDP for Q2 as a special line item. Expect a miraculous economic recovery in the second quarter, based in vapor. The stock rally since March was based in accounting fraud. These are true American innovations, but too bad they are not exportable! They are not, since they have no value."

Translated, what he is saying is that the government bailout money given to the banks was included in Gross Domestic Product statistics making it seem as though the economy is more robust than it actually is.

This is the equivalent of me taking out a loan of $50,000 from a bank and then including that $50,000 as income on my loan application. Sure makes me look a heck of a lot better than I really am!

And it is based on this type of accounting that investors are jumping back into the stock market thinking the worst is over. As soon as this myth is exposed, look for the next down leg of the market to be a real doozie.

Got gold?