Washington DC -- (ReleaseWire) -- 08/04/2014 --Even a Machiavellian U.S. Government can't hide the financial truth says Dawn Bennett, CEO of Bennett Group Financial Services, in her latest warning to investors.
In the United States government today, there is a sense that there is very little agreement about what is considered right and wrong. There is a Machiavellian system in place that suggests the ends matter more than the means. We believe it's because they no longer believe in the same values and principles that our Founding Fathers taught us, which is a free people cannot survive under a guiding Constitution unless they remain virtuous and morally strong.
The most promising method of securing a virtuous people is to elect virtuous leaders in every department. Samuel Adams, one of the Founding Fathers of the United States, once said, "Neither the wisest Constitution nor the wisest laws will secure liberty and happiness of a people whose manners are universally corrupt. He, therefore, is the truest friend to the liberty of his country who tries most to promote its virtue, and who will not suffer a man to be chosen into any office of power and trust who is not a wise and virtuous man.
"If Samuel Adams was alive today, he would see that from politics to the economy, it just seems like the ends matter more than the means.
Given what's happened in the last 10 years, one wonders how the U.S. government will ever regain citizen trust, but it seems it doesn't need to. Through the media and other forms of communication, call it propaganda, government officials believe the American people think that they are doing their job, and that citizens never lost trust in them. They believe citizens blissfully buy into everything they tell us, especially when it comes to the state of the U.S. economy, which I believe is one of the greatest propaganda coups of our time.
Does Washington think we are idiots? Does the government's failure to admit their mistakes undermine their credibility? Whether it's the Bureau of Labors statistics or the White House, they have simply fleeced the American people in broad daylight and convinced us to believe all is well in the U.S. economy, except it isn't. Bernanke, now Yellen's experiment in market central planning in which a central bank's balance sheet is far more important than fundamentals, has been one of the greatest investing perversions to ever emerge in the U.S. markets.
Yes, there's been no downside risk for the last five years, and this is all courtesy of the Federal Reserve, where stock returns have been disproportionately skewed to the upside, and economic numbers they put forth, just tell us that we're in recovery. However, we are starting to see a modest warning shot across the bow of what may be coming down the line.
This past week, July 21, 2014, the Dow Jones Industrial average had its biggest decline in seven weeks starting with the four percent decline index, which lowered its full-year revenue forecast quite substantially.
Next Amazon reported their ugliest earnings in years, which caused the stock to tumble 10 percent and weighed heavily on the NASDAQ index.
First it reported an earnings-per-share loss of $0.27 versus the $0.15 they were expecting, which was a net result of $126 million in net income. The operating loss was only $15 million, compared to what they were expecting, of $64 million.
However, this appears to be the result of pulling forward revenue into second quarter, since the company also announced at the same time that the third quarter loss would be a whopping $410 million to $810 million, which would be their biggest operating loss in years. But according to the propaganda spin that came out immediately in the media after they announced, this bad news was due to the weather and it had absolutely nothing to do with the state of the U.S. consumer. Yeah right.
Next came Caterpillar’s earnings, the bellwether industrial company. Starting in December 2012 and continuing through today, Caterpillar has reported 19 consecutive months of declining global year-over-year retail sales. The last and only time it had 19 consecutive months of such a decline was the period starting in October of 2008, just when Lehman filed for bankruptcy.
So this great financial recovery we are supposed to be in feels more like the great financial crisis. Too many American investors are being too easily manipulated into believing what others want them to believe. Investors need to avoid becoming investment victims and look at the reality. They need to ask who can be trusted?
All market data references are sourced to Bloomberg terminal database.
Bennett Group Financial Services LLC, based in Washington, D.C., is a comprehensive financial services firm committed to providing opportunities to clients’ as they seek long-term financial success. Its customized programs are designed with the potential to help grow, lower overall risk and conserve client assets by delivering a high level of personalized service and skill.
For more information, call 866-286-2268 or visit http://www.bennettgroupfinancial.com
Securities offered through Western International Securities Inc. (WIS), member FINRA/SIPC. BGFS and WIS are separate and unaffiliated entities.
About Dawn Bennett
Dawn Bennett is CEO and Founder of Bennett Group Financial Services. She hosts a national radio program on called Financial Myth Busting http://www.financialmythbusting.com. She discusses educational topics and events in the financial news, along with her thoughts on the economy, financial markets, investments, and more with her live guests, who have included Rock Legend Ted Nugent, as well as Steve Forbes and Grover Norquist. Listeners can call 855-884-DAWN as well as take podcasts on the road and forums for interaction. The show is a great complement to Dawn’s monthly investing seminars that take place at Tysons Corner in McLean, VA, where she discusses in vesting.
She can be reached on Twitter @DawnBennettFMB or on Facebook Financial Myth Busting with Dawn Bennett or dbennett@bennettgroupfinancial.com