Citigroup (NYSE:C) In Denial on Economy as Recession Worsens

It's hard to believe that analysts and economic commentators even use the terminology of a double-dip recession, or we're going to enter into a period of "modest gains," but that's what Citigroup (NYSE:C) analyst David Thurtell stated.

Thurtell said, "All the signs are that for the US economy, the fast part of the recovery is over, and it is now making modest gains. The gains are simply not enough to reduce unemployment.

"There are concerns about the flow-on that will have on the equity markets, so that is helping gold," he said. "There are also more signs, perhaps, that the Fed will have to do some more quantitative easing."

Amazingly, Thurtell won't even admit an economic slowdown, he only calls it a period of modest gains.

Even with the gargantuan stimulus thrown into the U.S. economy, there was never a period which could be identified as "the fast part of the recovery," which Thurtell asserts is now over.

If there was ever a fast part of a recovery, I wonder where all the job creation in that fast part was, and how long those jobs lasted.

Why do the majority of economic commentators and analysts make these outrageous comments? They fail to, or refuse to, take into account the hundreds of billions poured into the American economy, which they apply to the GDP.

Included in the GDP is government spending. So anyone that wants to create an illusion of recovery simply throws enough money at it to prop it temporarily up.

So when you read the data, the approximate $1 trillion spent by the government is identified statistically as growth. It wasn't, but it's on the books as such.

As the stimulus money begins to run out, as it is now, the appearance of a slowdown in the economy emerges, even though it never left.

Creating money out of thin air nobody produced something for, eventually must be paid back by someone, and when it's not the market creating the capital, it's hidden debt that generations far into the future will have to pay for, if in this case, they can survive the carnage coming from it.

Now we have a bigger problem because the national debt and obligations is so high it's close to impossible, if not impossible to pay for.

Not only that, but the trillion dollars did absolutely nothing to address the underlying problem, but instead has exasperated it.

Even worse, now federal government employees are paid over double what their private sector counterparts are. Who pays for those ridiculous and unearned wages? The productive workers in the private sector who will eventually be taxed to death, even worse than they are now.

The real wage gap isn't between executives and regulars, but between government workers and the private workers, who produce the capital to pay for these parasites.

In the middle of all this government failure, we have them and the Federal Reserve recently commiting to more quantitative easing if things continue as they are.

If $1 trillion doesn't solve the problem, how will more government spending solve the problem? It can't of course, and this is why the recession which never ended will continue on, and assuredly get much worse than it has been.

For Citigroup analyst David Thurtell to say we're even in a recovery, having just left one that had been growing fast, and then say will continue to be a modest recovery, shows the reasons why the banking industry itself collapsed.

If they don't understand these simple elements of the economy, how in the world can they given believable commentary and analysis about anything else?

We've been saying for months at Commodity Surge that we've never left the recession, and that it continues on. We stand by that assertion, and soon those reading this will find out we're right.

At minimum people and institutions need to have a contingency plan in place based on that possibility.

Consumer Sentiment Drops to 11-Month Low

A survey conducted by Thomson Reuters/University of Michigan named Thomson Reuters/University of Michigan's Surveys of Consumers, found consumer sentiment has fallen to its lowest level in almost a year.

This is an extraordinary turn of events over just a month, as last month the highest level of consumer sentiment had been reached in almost 2-1/2 years. When it is built more on wishful thinking and hope rather than realities of the economy, these types of huge swings can happen quickly, and it of course now has.

In June the numbers were at 76.0, while in July the plunged to 66.5. Economists had been looking for 74.5.

Director of the surveys, Richard Curtin said this, "Income and job prospects were extraordinarily weak and those bleak prospects have made consumers much more cautious spenders."

After the Democrat-controlled Congress stopped their irresponsible spending spree, the reality the economy wasn't growing but was rather being artificially propped up is setting in, and consumers are understanding we've never left the recession, and there hasn't been a recovery.

Consumers also said in the surveys that they aren't going to be buying any big ticket items like automobiles in the foreseeable future, showing again the hype about a recovery was largely reported by the mainstream media as a reality to prop up Obama and the Democrats, rather than hard reporting on the fact that we're still in a recession.