Optimism Bias

Watch Lakshman Achuthan defend himself with facts against the optimism bias from yet another financial journalist.

I think optimism bias is a nice euphemism for what is in fact a massive propaganda campaign by Wall Street to shift risk onto Main Street at artificially elevated prices. As this piece on bias says:

Man, all those stories too about the US economy recovering, enough already. The US ain’t going anywhere forward without Europe, and Europe is moving backwards if at all. Economic growth at unemployment rates of 25% in Greece and Spain and what is it, 14-15% stateside (?!), is not a viable thing. Our optimism plays games with us, and so do our politicians, to the extent that we come to think it’s actually possible, though we know we should know better, to pay off our debts with more debt. Blinded by the light inside.

Quite. Today’s manufacturing PMI indicates contraction. Watch out for employment numbers later in the week if you are bullish, I suspect that they will not be pretty given the bump up in jobless claims. And don’t talk about Sandy – claims started rising before Sandy. Now Twinkies – that’s real and that’s 18,500 jobs right there, thrown under the bus by the union to avoid setting a precedent.

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