Why the Government Is Lying to You – And What You Can Do About It

by Andrew Zatlin June 09, 2023 11:00 am ET

On Tuesday, I dropped a bombshell:

The U.S. government is lying about key economic data.

Today, I'll tell you why it's being dishonest – and how we as investors can profit from it.

Why the Government Is Lying to You – And What You Can Do About It

Earlier this week, I showed you evidence that May's payroll data was falsified.

I took you down the rabbit hole of mechanics and gave you a look at how we're being shown a much rosier picture than what's really going on.

Today, I'll tell you why this picture is being painted, and what investors like us can do about it. But first...

Year-Round Deception

It's important to understand that the government didn't just massage payroll data last month. It's been doing it all year.

Let me show you:

This is official seasonally adjusted payroll data for the high-tech sector dating back to January 2022.

Based on this chart, the government is telling us that things aren't great for high tech, but they're not terrible, either. According to this data, about 35,000 jobs have been cut since December 2022.

The thing is, based on news stories and company releases, we know that 200,000 high-tech jobs have been cut so far this year. Where did they go? Why aren't they reflected in the chart above?

Simple: The government has been spiking – oops, I mean "seasonally adjusting" – the data.

In fact, look at this...

How the Data Gets Massaged

These charts show how drastic the seasonal adjustment in the tech sector has been over the past few months – including February:

In March:

And in April:

This is how the government can take a 200,000 job-cut epidemic and pass it off as a situation that's merely "meh."

Why all of this deception?

Is Biden Behind This?

Consider this: If payroll data wasn't as encouraging, the Federal Reserve wouldn't be in position to keep interest rates as high as they've been, let alone continue raising them.

So that leads me to wonder: Who benefits the most from having higher interest rates for longer?

There are several theories. But my favorite has to do with President Joe Biden's efforts to remain in the White House.

You see, next year is an election year. And sitting presidents don't get re-elected when the economy is bad. If you're Biden, why leave things to chance? Why not manufacture a bullish economy in 2024, when all eyes are on you?

That's possible. But to do it, it means forcing a recession now to set up the boom times next year.

That's the key. If interest rates remain high, the economy will continue to slow down and contract. That will trigger a recession, which can take effect at the right time to allow for a headline-worthy rebound next year. The result? 2024 will be the Year of the Bull.

What You Can Do About It

The theory I mentioned above is merely that – a theory. But no matter the real reason, we need to take action as investors.

We know the economic downturn is coming. So it's time to get defensive. Two weeks ago, I told you to be opportunistic and buy during the manufactured debt ceiling crisis – the "nothing burger."

Now, consider taking some winnings off the table. It may feel too early, but wealth is often preserved by selling too early. That's how you sidestep the biggest losses.

If you're a "Pro" subscriber, I'll give you another idea (hopefully you took advantage of Tuesday's recommendation) on how to get positioned for this.

We're in it to win it. Zatlin out.