The Durk Pearson & Sandy Shaw®
Life Extension NewsTM
Volume 11 No. 1 • January 2008

Shadow Government Statistics: Tells You Much More About the Economy Than What the Government Tells You

Ever wonder whether the rate of inflation is really what the feds say it is or whether their “Consumer Price Index” is an accurate picture of prices consumers are paying? This Web site is John Williams’ Shadow Government Statistics at You get information such as what inflation looks like using the old method of government estimation as compared to the modifications put in to reduce the communication of data on price volatility. For example, under the new rules, food and energy prices are not counted in the calculation of the Consumer Price Index. (You show us somebody who doesn’t buy food or energy and we’ll show you a dead body.) This Web site is a great source of corrective information to help you maintain a grip on economic reality.

According to Mr. Williams’s calculation, using the old government rules, inflation is now about 10%, much worse than the feds are admitting. The Federal Reserve is pumping immense amounts of money into the economy via Federal Reserve banks that lend money to other banks. This new money, however, does not represent any actual goods or services. More money chasing the same or fewer goods and services results in higher prices. A 10% rate of inflation means that, unless you can find something to put your money into that will give you a return of 10% after taxes, you are better off spending the money right away on tangible things that are likely to hold their value better than the dollar.

Find out who is lying and why by visiting this site.

From the Flash Update, December 28, 2007:

  • Help-Wanted Advertising Plunges to Lowest Level Ever

From the December 2007 edition:

  • Actual 2007 Federal Deficit Topped $4.0 Trillion
  • Fed Allows Strongest Money Growth in 36 Years

D&S note: Money growth is known as M3. The M3 amount was given out publicly by the Federal Reserve Board in its usual reports until last June, when M3 was running at about 9%. M3 was increased to 14% after June, when M3 had disappeared from the Federal Reserve Board reports. The Fed claimed that it discontinued reporting M3 to save $14 million a year. Of course, the economic decisions people have been making in the absence of a clear picture of the increase in the money supply (and its effects on prices) are likely to result in costs to the public from economic miscalculations far in excess of $14 million a year.

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