"There are two sorts of wealth-getting, as I have said; one is a part of household management, the other is retail trade: the former necessary and honorable, while that which consists in exchange is justly censured; for it is unnatural, and a mode by which men gain from one another. The most hated sort, and with the greatest reason, is usury, which makes a gain out of money itself, and not from the natural object of it. For money was intended to be used in exchange, but not to increase at interest. And this term interest, which means the birth of money from money, is applied to the breeding of money because the offspring resembles the parent. Wherefore of modes of getting wealth this is the most unnatural."

- Politics, Aristotle, 350 B.C.

"The Jew alone regards his race as superior to humanity, and looks forward not to its ultimate union with other races, but to its triumph over them all and to its final ascendancy under the leadership of a tribal Messiah."

- Goldwin Smith, The Jewish Question, October 1881

“I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated governments in the civilized world. No longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and duress of a small group of dominant men.”

- President Woodrow Wilson 1916

“We are grateful to the Washington Post, The New York Times, Time Magazine and other great publications whose directors have attended our meetings and respected their promises of discretion for almost forty years. It would have been impossible for us to develop our plan for the world if we had been subjected to the lights of publicity during those years. But, the world is now more sophisticated and prepared to march towards a world government. The supranational sovereignty of an intellectual elite and world bankers is surely preferable to the national auto-determination practiced in past centuries.”

- David Rockefeller, Baden-Baden, Germany 1991

“It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”

- Henry Ford 

“The real truth of the matter is, as you and I know, that a financial element in the larger centers has owned the Government ever since the days of Andrew Jackson.”

- Franklin D. Roosevelt, letter to Col. House, November 21, l933

“One of the least understood strategies of the world revolution now moving rapidly toward its goal is the use of mind control as a major means of obtaining the consent of the people who will be subjects of the New World Order.”

- The National Educator, K.M. Heaton

"We Jews, we, the destroyers, will remain the destroyers for ever. Nothing that you will do will meet our needs and demands. We will for ever destroy because we need a world of our own, a God-world, which it is not in your nature to build."

- Maurice Samuels, You Gentiles, 1924

“We are on the verge of a global transformation. All we need is the right major crisis and the nations will accept the New World Order.”

- David Rockefeller 

“Today, America would be outraged if U.N. troops entered Los Angeles to restore order. Tomorrow they will be grateful! This is especially true if they were told that there were an outside threat from beyond, whether real or promulgated, that threatened our very existence. It is then that all peoples of the world will plead to deliver them from this evil. The one thing every man fears is the unknown. When presented with this scenario, individual rights will be willingly relinquished for the guarantee of their well-being granted to them by the World Government.”

- Dr. Henry Kissinger, Bilderberger Conference, Evians, France, 1991

How to Think Clearly

"Never argue with stupid people. They will drag you down to their level and then beat you with experience." –Mark Twain

If you want to begin to understand and appreciate the work of Mike Stathis, from his market forecasts and securities analysis to his political and economic analysis, you will first need to learn how to think clearly. For many, this will be a cleansing process that could take quite a long time to complete depending on each individual.

The best way to begin to clear your mind is to first move forward with this series of steps:

1. GET RID OF YOUR TV SET (at least cancel your cable)


3. DO NOT USE A "SMART PHONE" (or at least do not use your phone to access the internet)


The cleansing process will take time but you can hasten the process by being proactive in exercising your mind.

You should also be aware of a very common behavior exhibited by humans who have been exposed to the various aspects of modern society. This behavior occurs when an individual overestimates his abilities and knowledge, while underestimating his weaknesses and lack of understanding. This behavior has been coined the "Dunning-Kruger Effect" after to sociologists who described it in a research publication. See here.

Many people today think they are virtual experts on every topic they regard with relevance. The reason for this illusory behavior is because these individuals typically allow themselves to become brainwashed by various media outlets. The more information these individuals obtain on these topics from the media, the more qualified they feel they are in these subjects, without realizing that the media is not a valid source with which to use for understanding something. The media always has bias and can never be relied on to represent the full truth.

A perfect example of the Dunning-Kruger Effect can be seen with many individuals who listen to talk radio shows. These shows are politically biased and consist of individuals who resemble used car salesmen more than intellectuals. These talking heads brainwash their audience with cherry-picked facts, misstatements and lies regarding relevant issues such as healthcare, immigration, Social Security, Medicaid, economics, science, and so forth. They also select guests for interview based on the agendas they wish to fulfill with their advertisers.

Once their audience has been indoctrinated by these propagandists, they feel qualified to discuss these topics on the same level as a real authority, without realizing that they obtained their understanding from individuals who are employed as professional liars and manipulators by the media.  Another good example of the Dunning-Kruger Effect can be seen upon examination of political pundits, stock market and economic analysts on TV.  They talk a good game because they are professional speakers. But once you examine their track record, it is clear that these individuals are largely wrong, but they have developed an inflated sense of expertise and knowledge on topics for which they continuously demonstrate their incompetence.

One of the most insightful analogies created to explain how things are often not what you see was Plato's Allegory of the Cave, from Book 7 of the Republic.

We highly recommend that you study this masterpiece in great detail so that you are better able to use logic and reason.Although we recommend you read and study The Allegory of the Cave, you can get a flavor for its meaning by watching the following video. 

If you can learn how to think like a philosopher, specifically one of the great ancient Greek philosophers, it is highly unlikely that you will ever be fooled by con artists like those who make ridiculous and unfounded claims in order to pump gold and silver, the typical get-rich-quick or multi-level marketing (MLM) crowd.

STOP Being Taken

“Beware of false prophets, which come to you in sheep's clothing, but inwardly they are ravening wolves.”

King James Bible - Matthew 7:15

"It's easier to fool people than to convince them that they have been fooled." –Mark Twain

All Viewpoints Are Not Created Equal Just because something is published in print, online or aired in the broadcast media does not make it accurate.  In fact, more often than not the larger the audience, the more likely the content is either inaccurate or slanted. The next time you read something about economics or investments, you should ask two main questions in order to assess the credibility of the source. Is the source biased in any way?   That is, do they have any agendas which would provide any type of benefit accounting for their views? Most individuals either sell ads on their site or are dealers of precious metals or securities. That means their views are biased and cannot be relied upon.

Is your source is credible?  

Most people associate credibility with name-recognition. But more often than not, name-recognition serves as a predictor of bias if not lack of credibility because the more a name is recognized, the more the individual has been plastered in the media. And every intelligent person knows that individuals who have been provided with media exposure because they are either naive or clueless. The media positions these types of individuals as “credible experts” in order to please its financial sponsors; Wall Street. 

Instead of name-recognition or media celebrity status, you must determine whether your source has relevant experience on Wall Street as opposed to being self-taught. But this is just a basic hurdle that in itself by no means ensures the source is competent or credible. More important, always examine the track record of your source in depth, looking for accuracy and specific forecasts rather than open-ended statements. You must also look for timing since a broken clock is always right once a day.  Finally, make sure they do not cherry-pick their best calls. Always examine their entire track record. 

“Beware of false prophets, which come to you in sheep's clothing, but inwardly they are ravening wolves.”

King James Bible - Matthew 7:15

The above questions require only slight modification for use in determining the credibility of sources that discuss other topics, such as politics, healthcare, etc.We have compiled the most extensive publication exposing hundreds of con men pertaining to the financial publishing and securities industry, although we also cover numerous con men in the media and other front groups since they are all associated in some way with each other. There is perhaps no one else in the world capable of shedding the full light on these con men other than Mike Stathis. Mike has been studying the indistry for well over a decade. Alhough he has published numerous articles and videos addressing this dark side of the industry, the entire collection can be found in our ENCYCLOPEDIA of Bozos, Hacks, Snake Oil Salesmen and Faux Heroes
At AVA Investment Analytics, we don't try to pump gold, silver or equities like many others you see because we are not promoters or marketers. And we do not receive any compensation whatsoever (including from ads) from our content. We provide individual investors, financial advisers, analysts and fund managers with world-class research, education and unique insight.

Media Lies

If you listen to the media, most likely it is costing you hundreds of thousands of dollars in lost money at minimum over the course of your lifetime. The deceit, lies and useless guidance from the financial media certainly is a large contributor of these losses to the sheep you pay attention.

But a good deal of lost wealth comes in the form of excessive consumerism which the media seeks to impose on its audience. You aren’t going to know that you’re being brainwashed or that you have lost $1 million or $2 million over your life time due to the media, but I can guarantee you that with rare exception this is the reality for those who are naïve enough to waste time on the media.

It gets worse. By listening to the media, you are likely to also suffer ill health effects through the lack of timely coverage of toxic prescription drugs or through the ridiculous medical shows, all of which are supportive of the medical-industrial complex.

And if you seek out the so-called "alternative media" you might make the mistake of relying on con men like Kevin Trudeau or Alex Jones. This could be a deadly decision. As bad as traditional media is, the so-called "alternative media" is even worse.

Why Does the Media Air Liars and Con Men?

The goal of the media is NOT to serve its audience because the audience does NOT pay the bills.

The goal of the media is to please its sponsors, or the companies that spend huge dollars buying ads, and in order for companies to justify these expenses, they need the media to represent their cause. The media does this by airing idiots and con men who mislead and confuse their audience.

By engaging in "journalistic fraud," the media steers its audience into the arms of its advertisers because the audience is now misled and confused, so in the case of the financial media, it seeks the assistance of Wall Street brokerage firms, mutual funds, insurance companies, precious metals dealers. This is why advertisers pay big money to be promoted in the financial media.

We see the same thing on a more obvious note in the so-called "alternative media," which is really a remanufactured version of the so-called "mainstream media." Do not be fooled. There is no such thing as the "alternative media." 

In order to be considered "media" you must have content that has widespread channels of distribution. Thus, all "media" is widely distributed and the same powers that control the distribution of the so-called "mainstream media" also control the distribution of the so-called "alternative media."

The claim that there is an "alternative media" is merely a sales pitch designed to capture the audience that has since given up on the "mainstream media."  The tactic is a very common one used by con men.

The same tactic is used by Washington to convince naive voters that there are meaningful differences between the nation's two political parties. In reality, both parties are essentially the same when it comes to issues that matter most (trade policy, healthcare and war). Anyone who tells you anything different simply isn't thinking straight.

On this site, we expose the lies and the liars in the media. We discuss and reveal the motives and track record of the media’s hand-selected charlatans with a focus on the financial media.  

Why Stathis Was Banned

No one has generated a more accurate track record in the investment markets over the past several years than Mike Stathis. Yet, the financial media wants nothing to do with Stathis.

You aren't even going to hear him on the radio being interviewed.

You aren't going to see him mentioned on any websites either.

You won't read or hear of his remarkable track record unless you read about it on this website or read his books.

You should be wondering why this might be. Some of you already know the answer.

The media has banned Mike Stathis because the trick is to air clowns so that the audience will be steered into the hands of the media's financial sponsors - Wall Street and gold dealers.

And as for the radio shows and websites that either don't know about Stathis or don't care to hear what he has to say, the fact is that they are so stupid that they assume those who are plastered in the media are credible. And since they haven't seen or heard Stathis in the media, even if they come across him, they automatically assume he's a nobody in the investment world simply because he has no media exposure.

Well, if media exposure was a testament to knowledge, credibility and excellent track records, Peter Schiff's clients would be a lot happier when they looked at their account balance.

Others only care about pitching what’s deemed as the “hot” topic because this sells ads in terms of more site visits or reads. This is why you come across so many websites based on doom and conspiratorial horse shit run by con artists looking to cash in on ads.

We have donated countless hours and huge sums of money towards the pursuit of exposing the con men, lies and fraud. We continue this mission but we cannot continue it forever without your assistance.

We have been banned by virtually every media platform in the U.S and every website (mainly because we expose the truth about gold and silver).

We have been banned from use of email marketing providers.

The fact is that the Jewish Mafia has declared war on us because we have exposed the realities of the U.S. government, Wall Street and corporate America.

Note that we only began discussing the role of Jews in criminality by 2009, three years AFTER we had been black-listed by the media, so no one can say that our criticism of the Jewish Mafia has led to being black-listed, not that it would even be acceptable.

You can talk about the Italian Mafia, and Jewish Hollywood can make 100s of movies about it...


We rely on you to help spread the word about us. Just remember this. We don’t have to do what we are doing.

We could do as everyone else and focus on making money. We are doing sacrificing everything because in this day and age, unfortunately, the truth is revolutionary. It is also critical in order to prevent the complete enslavement of world citizenry.   

Rules to Remember

On Exposure: No one who has significant exposure can be trusted because those who are responsible for permitting such exposure have allowed it for a very good reason, and that reason does not serve your best interests.

On Spotting Frauds: Whenever you wish to know whether someone can be trusted, always remember this golden rule..."a man is judged by the company he keeps."

This is a very important rule to remember because con men almost always belong to the same network.

You will see the same con artists referencing each other, on blog rolls and so forth.

  • How to Think Clearly
  • STOP Being Taken
  • Media Lies
  • Why Stathis Was Banned
  • Rules to Remember
  • X close

Filtering Through the Noise

Note: this article has been provided for free to give readers an indication of what they will receive when our premium content subscriptions are rolled out. You should check the archives and Critical Reads for more examples of what to expect as a premium member. More details about enrollment will be posted in the future.

Early last month, the Commerce Department released the latest GDP data. For Q2 of 2010 the GDP growth came in at 2.4%, missing the consensus estimate of 2.5%.

The Commerce Department also released its latest revisions to 2007-2009 GDP data. As I had predicted, the economy shrank more than the previous estimate of 2.6% versus the 2.4% data recorded last year. That made it the largest drop in GDP since 1946.

Moreover, the revisions in August indicated 0% economic growth for all of 2008 versus the previous estimate of 0.4%.

Finally, in 2007 the economy grew by only 1.9% versus the previous 2.1% figure. Overall, since the recession began in December 2007 through June of 2010, GDP has declined by 4.1% according to the latest revisions by the Commerce Department.

Fast-forward to a month later. On August 27, the Commerce Department revised the Q2 2010 GDP data downward. From April to June (Q2) the GDP was revised down to 1.6%, from the initial 2.4% estimate. This latest data has strengthened the growing consensus that the “recovery” is weakening.

I have continued to insist that the initial GDP data would be revised down significantly. This is precisely what we are now seeing. By now, you should understand that there is no recovery in progress. The recession is alive and well, now entering its 34th month.  This is a fact which no one who is familiar with the economic environment can legitimately refute. Let me be crystal clear.


As I predicted would be the case in America’s Financial Apocalypse (2006), we are in the midst of America’s Second Great Depression. The current recession is just one component of the socioeconomic depression that will be recorded in history books long after it has ended. 

Amazingly, most people still have not read this book, despite the fact that it still represents by far the most accurate and comprehensive look at America’s problems. If you are unfamiliar with this book, you can blame the media. They wanted to make certain to hide the realities from the people. Thus, it was the media who ultimately caused you to lose your life savings. If you pay attention to the media, you only have yourself to blame when you lose money.

Wall Street and Washington hacks scattered throughout America’s media monopoly continue to mislead the public, with debates about a double-dip recession as if this terminology has legitimacy. Understand that anyone who uses this bogus term has NO CREDIBILITY, as I have previously discussed.

Sadly, everyone who enters a discussion about the economy has chosen to adhere to buzz words created by hacks without bothering to question whether they’re applicable. This includes the perma-bears and gold bugs. They’re all followers in thought. They’re all behind the curve. 

Understand that the revisions in economic growth have not yet been adequately factored into the stock market in my opinion. Perhaps the reason accounting for this is because investors fail to realize these downward revisions represent a future trend. Once they realize this fact, the stock market is likely to take some big hits.

I’ve been forecasting major moves in the stock market with near 100% accuracy over the past four years, so I think I have a good idea where the market is headed down the road.

As you can see from the table below, the cheerleaders are going to be embarrassed yet again once final GDP data is tabulated (and revised) for 2010. According to virtually every hack organization out there, the U.S. economy is forecast to grow at or over 3% for 2010. Even with the help of numerous tax subsidies and the ARRA, this forecast is ridiculous, as I’ve mentioned in the past.

Based on what I see currently, the official growth will be 1.5 to 2.1% for the year once all data has been completely revised. Depending on the timing of how this data is revised downward, it could potentially cause some big problems for the U.S. stock market. But as you know, this game is one of a relative nature. Thus, continuing problems in Europe could neutralize the full impact of the economic situation in the U.S.


As you can see from the 2011 data, the hacks have come down a bit knowing that the stimulus will be all but exhausted. As a result, they have forecast 2.9% growth for 2011. This too is ludicrous. Without additional stimulus packages, I am confident productivity won’t exceed 1.3%. It’s likely to come in below 1% once the data has been fully revised.

If the proper adjustments were made, GDP since 2001 might be less than 1%. I made this same argument through 2006 in America’s Financial Apocalypse, when the “experts” claimed the economy was doing great.

There’s no way on earth productivity can increase with unemployment so high. The length of time the unemployed have remained without work is going to add to the nation’s chronically high unemployment rate.


If there’s no real consumer demand, there’s no demand by companies to hire more workers. It’s as simple as that. Even Washington shills expect unemployment to remain high for quite some time. Yet, they continue to inflate productivity estimates.

Upon seeing the wave of worsening economic data roll in, the White House’s economic cheerleader, Fed Chairman Bernanke rushed to downplay the severity of the recession, as he has done since it began. In a statement flooded out by the media, Bernanke flip-flopped from statements made just a few months ago when he proclaimed the “recovery” was advancing even more rapidly than expected.

According to Ben’s latest outlook, the current pace of economic growth is "somewhat less vigorous" than expected, but he remained optimistic for improvements in 2011. He added that the central bank is prepared to provide additional "unconventional measures" if the outlook were to "deteriorate significantly."

Incidentally, the timing of Bernanke's statement couldn't have been better, as the Dow was flirting with the critical support around 9900.

As lost as Bernanke remains as to the extent of the economic collapse, the nation’s “leading” economists appear to be equally confused. In a recent survey, 38% of economists believe the nation's current fiscal policy is "about right." However, 64% support an extension of unemployment benefits for up to two years. As well, the majority of economists surveyed stated that none of the existing tax cuts on individual income, dividends and capital gains should be allowed to expire. The fate of more than 100 tax breaks will be decided over the next several months.

This illustrates just how misguided the majority of U.S. economists remain. Extending the duration of unemployment benefits will surely reduce the incentive of millions to find gainful employment. With unemployment at a stand-still, Congress has already extended unemployment benefits a whopping seven times over the past two years. It sure sounds like a great time to be unemployed; that is if you don’t feel like working. No doubt, Congress will pass more unemployment extensions over the next few years, along with additional subsidies and other desperate attempts to create false demand.

The National Association of Business Economists (NABE) recently stated that 75% of its members feel that promoting economic growth is more important than reducing the national deficit. However, the same number of economists doesn’t feel another stimulus package is necessary. The majority believe that policymakers should do more to boost job growth, but they don’t seem to have any answers. I discussed the solutions in the January 2010 issue of the AVAIA newsletter.

So what are they saying? If they don’t want another stimulus, how do they propose to stimulate economic growth?  These are the same economists who support America’s unfair trade policies which continue to export millions of jobs overseas. These economists are clearly confused.

For the past several years, the U.S. has only been able to promote economic growth by flooding money into the banking system so as to create bubbles. Current trade policies do not permit viable economic growth in the absence of excessive credit. Meanwhile, the U.S. relies on foreign nations to finance Washington's ridiculous spending sprees. But China will only continue to hold dollars if U.S. consumers keep buying their goods. 

Washington and the Federal Reserve have clearly established a Ponzi scheme, and have labeled it economic growth. Regardless how much U.S. Treasuries foreigners agree to buy, it will not lower America's massive national debt.  

Ever since Fannie and Freddie were bailed out, I discussed the fact that there would be many more bailouts. This is exactly what we have seen. And ever since the ARRA was passed, I predicted this would be only one of many more economic stimulus packages to come over the next several years.

I have not changed my opinion. It should be clear that several additional stimulus packages and subsides will be passed because creating false demand through debt-spending has become the primary manner by which to create the impression of real economic growth in the U.S. This keeps the Ponzi scheme going.

But we all know that all Ponzi schemes come to a very brutal end. Bernie Madoff mitigated the losses to his investors when he turned himself in. If he had waited until he was discovered, there probably wouldn’t have been any funds remaining.  Will Washington finally admit the fundamental problems embedded within the U.S. economy, or will they remain arrogant, thinking they can keep up this scam forever?

With the Q2 earnings nearly finished, more than 80% of companies that have reported have beat earnings estimates, while around 70% have beat revenues expectations. Sounds pretty good right?

First, keep in mind that estimates were understated so as to not disappoint. Second, most corporations have focused on aggressive cost-cutting measures in order to boost profits. This is why revenues are down relative to earnings. 

Finally, forward guidance from many companies has not been particularly encouraging, even from the blue chips and tech giants. As revenues continue to show signs of decline and margins continue to shrink from record highs, many of the giants have turned to acquisitions as a way to enter new markets. Instead of recognizing these transactions as acts of desperation, investors have hailed them as indicators of future earnings growth.

Much of the reason for the boost to the U.S. stock market has been due to Europe’s problems. Investors are looking for a safer place to hide. However, for non-professional traders the safest place to be is in cash. As of late, it would appear that Wall Street has recently extrapolated earnings data through the rest of 2010. This is going to prove as a big mistake. 

Also in August came the highly anticipated news that for the first time ever, China surpassed Japan as the world’s second largest economy. However, China’s per capita income remains stuck at about $3,800. The low wages in China is already creating many problems, from labor protests to suicides.

Some of America’s largest multinational giants have already begun to pull out of China because they see the end of the cheap labor gravy train. Imagine what higher wages in China will do to the U.S. and Chinese economy. Now combine that with the continued (although gradual) removal of the Yuan-Dollar currency peg. There is no doubt that systemic risk is building in China’s economy.

The hacks have created the perception that the troubles in Europe are subsiding. Last month, earnings from many of the large European corporations surprised even the most optimistic forecasts from analysts. As well, the economic data was a bit better than expected. However, much of this positive data was restricted to Germany and France. As you might imagine, the problems in Europe are far from over.


It doesn’t really matter whether Germany and France are showing some (short-term) signs of improvement. One reporting period does not mean much. Moreover, what’s important is the state of the European Union taken as a whole.

To imply that the problems in Europe have subsided based on upbeat data from Germany and France is like saying that the U.S. is improving because the economic data in Texas and New York came in better than expected. 

A rather surprising recent trend has been the huge international demand for emerging market debt. Even more surprising is that investors have been willing to buy Brazil’s bonds at yields at about 150 basis points above comparable U.S. Treasuries. This means that the spread between the two bonds (150 basis points) represents the risk of default. Apparently, there was nowhere near enough of these bonds to meet investor demand, as the new issues outpaced demand by a factor of seven.

As much as I like Brazil's future economic growth, to me that’s just crazy. Brazil’s economy, just like China’s, has been largely propped up by U.S. economic policy and the global credible created by the Federal Reserve. Thus, any problems in the U.S. will adversely impact Brazil, China and the other emerging markets.

Even Chile, which has a lower credit rating than Brazil, sold bonds at just 90 basis points above U.S. Treasuries.

Now there is speculation that soon, Argentina, a nation that defaulted on its debt just ten years ago (2001) will soon auction bonds.

In July, the cost for emerging market governments to issue dollar-denominated bonds fell to its lowest since early May, or 279 basis points over U.S. Treasuries, according to JPMorgan's EMBI+ index.

In part, this rush to buy emerging market sovereign debt has been catalyzed by the much better economic performance seen in these nations, not only since 2008, but for several years prior to that. But when you see yield spreads between emerging sovereign debt and risk-free U.S. Treasuries that low, it tells you institutional investors have no idea what’s going on. It’s truly shocking.

As well, with global uncertainty growing by the day, it is likely that many of these investors, which represent pensions and insurance plans, will want the more certain returns bond coupons provide. However, the current spreads simply fail to account for adequate risk.

I am willing to bet that over the next few years, many emerging market bonds being issued today will be trading with significantly higher yields in the secondary market, due to the economic volatility and increasing risks building in China. What that means is that investors lining up for these bonds are making very foolish decisions.

At the very least, if these record-setting levels of emerging debt issuances increase, a bubble could be formed in this market, albeit a few years down the road. Remember, the U.S. is in a unique position, having its economy and thus debt financing linked to oil. Thus, it has a much better ability to take on large levels of debt without a commensurate impact within the U.S.

Perhaps you recall the Federal Reserve’s analysis and forecasts for the economy a few of months ago. The Federal Reserve stated that the pace of the so-called economic recovery in the U.S. was faster than they had anticipated. As a result they raised their forecasts for GDP growth. The World Bank and IMF followed suit, as you would expect from any syndicate, issuing similar forecasts for the “global recovery.” Of course, I mentioned this was all hogwash in my newsletter.

Recently, the Fed lowered its estimate for economic growth in the U.S. for 2010. That should confirm once again that to listen to the Federal Reserve, Washington, the World Bank or the IMF is similar to handing your money to liars and thieves.

The Fed now predicts the economy will grow between 3% and 3.5% for 2010, down from their previous forecast of 3.2% to 3.7% made in April. 

Sorry, but they’re still delusional. Growth will come in at 2010 well-below 3% when all numbers have been revised. And still, much of this growth will come as a result of the various stimulus plans and other actions taken by Washington and the Fed.

From an absolute sense, it is likely that the U.S. will register maybe about 0.5% growth for 2010, once all appropriate factors have been adjusted. The problem is that neither Washington nor the Fed ever makes these adjustments. Of course, you will never hear mention of this by Washington or the media because they want to keep the Ponzi scheme going.

Even after the Fed announced a more downbeat forecast for the so-called economic recovery, Fed Chairman Bernanke remains loyal in his role as a political cheerleader. Accordingly, he continues to downplay any chance of a double-dip recession, which as I have discussed isn’t even applicable. It’s truly a huge dog-and-pony show. And it’s getting very old from where I stand.

This is just more evidence that you cannot take what Washington says at face value. Yet, the media focuses on these incompetent fools. 

Why am I bothering to point this out? Because I want you to understand how the game is played. Sentiment is largely determined by the media because the media is presumed to present an objective assessment of the economy.

However, the problem is that the media is highly irresponsible because it presents the views of cheerleaders like the Wall Street analysts, the Fed and university economics professors.

And when they want to present a counter punch, they only air extremists who ultimately end up looking like fools. This is specifically why these men have been inducted into the media club. In the end, by providing the public with extremists, the media repositions credibility back towards Wall Street and Washington because real experts with excellent track record and without bias are never interviewed. This explains why investors get blind-sided when reality hits. They can’t win either way. That’s why it’s impossible to win by listening to the media. This is how the game has been designed.

However, if you understand the real picture in advance, you can model appropriate levels of risk into your investment strategy. And when the shoe drops, you’ll have cash to buy in at the lows, while most are stuck watching their portfolios crash and burn. 

Please do NOT forget what the clowns have been saying. You need to keep a journal so you will know who to trust and who to ignore. After searching for numerous years, I’ve not found anyone who is reasonably consistent with their forecasts.

The list of wrong forecasts and misguided investment advice over the past three years would fill the contents of a very large book, from the perma-bears who kept their followers out of the biggest stock market rally in decades, advised them to short the market by 200% leverage as of November of 2009 (apparently, Robert Prechter went all out to make sure this story was removed from the public domain so as to hide his horrendous track record, which stretches as far as the eye can see), continue to insist the dollar is headed to zero, and gold will top $10,000; to the perma-bulls who have made claims that a new bull market began in August of 2009, and who insist that the recession ended last summer.

The list of ridiculous forecasts is endless, as anyone who has kept a written tally can confirm. The blame ultimately lies with investors because most fail to document track records. They fail to do this because they are lazy and they associate media exposure with expertise and credibility. As we have seen, this is not at all the case.

For instance, Liz Sonders of Charles Schwab was one of the many hacks that claimed the recession was over in the spring of 2009. Abby Cohen stated that a new bull market began in August 2009. In contrast, the gold bugs and perpetual doomers told investors to stay out of the stock market ever since it bottomed in March of 2009. As a result, Main Street has largely missed out on the biggest rally in decades. This is in contrast to subscribers of the AVA Investment Analytics newsletter.

Some have performance records that make you think their purpose is to cause you to lose your money. If you want to make money and avoid losses, you need to start waking up and realize you’re being misled by a circus show designed to misinform you. 

The ringmasters of this circus show are the various financial media outlets, who intermingle perma-bulls with perma-bears into the act. All of them are extremists. Most of them are idiots. The rest are liars. They all have agendas and they all have terrible track records. That is precisely why the media has selected them as their designated "experts."   

If you aren’t documenting what the media’s “experts” are saying; if you are blindly listening to the views provided by the media, you are walking into a financial landmine.

The first rule of thumb to remember is that analysts and strategists working for discount brokers are clueless. If they had a clue they wouldn’t be working for discount brokers. They merely follow what Wall Street strategists are saying, much like the financial bloggers follow what the extremists in the media state. Of course we cannot assume that Wall Street has much more credibility. All Wall Street strategists were claiming the recession was over by early to late summer.

The second rule of thumb is to avoid any rhetoric from those who have agendas, such as that found from those who sell securities or gold. 

And remember, when you hear or read of anyone mention buzz words like double-dip recession or green shoots, you need to run like hell because that confirms they have no idea what they’re talking about. They are merely followers of the media Macarena.

What that means is that you aren't going to find many individuals out there who have a clue.


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