John Ransom
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Okay, so you can call me the glass-is-half-full-of-it kind of guy.

But don’t say that I didn’t warn you.

That second-half rebound that economists were talking about in the first half of the year? Well, it hasn’t materialized.

Like you I’m shocked.

My shock, however, has to do with the fact that the media gets snookered year after year with the “consensus” forecast from analysts, stock pickers, QE types and economist on the government dole, who say that in the second half, the economy will be much brighter than it was in the first half.

Durable good orders just came out for the first month of the second half—a month also known as July-- and boy, did the data stink.

“The Commerce Department said Monday that orders were down 7.3% in July from the previous month,” reports the Los Angeles Times, “the first drop since March and the biggest falloff since August 2012. Orders had been up a revised 3.9% in June. Analysts had projected a 4% drop last month.”

And with a government so compelled, seemingly, as the Obama administration is, to cook the books for every number, forecast and data point, one has to wonder whether the data for July was as good as the bad estimate that the Commerce Department just released.

Remember: I’m a glass-is-half-full-of-it kind of guy.

Good is bad and bad is good especially when it comes to goods, durable or otherwise.

You good on that?

Good.

Because, most assuredly, the stock market is good on it.

Durable goods are just the latest bad data point that the stock market will adore. They'll adore it because it means that quantitative easing (QE) could go on for quite a bit longer.

Behind the scenes, Federal Reserve regional presidents are bickering about the necessity and wisdom of more QE. Today the risks associated with QE, like inflation, for example, are beginning to outweigh any possible short-term benefit that QE supposedly brings.

That’s because – I’ll say it again folks – our problems are not economic; our problems are political.

That problem that we have where the economy is only creating part-time jobs? That’s a political problem, not an economic problem.

That problem where we enjoy an all-time high money supply, yet that money isn’t circulating in the economy?

That’s a political problem, not an economic problem.

That problem that we have where banks can make more money by doing nothing-- or doing something in the stock market-- rather than loaning money to people on Main Street?

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John Ransom

John Ransom is the Finance Editor for Townhall Finance.
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