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Bob Bronson takes a closer look at the 3.2% GDP growth recently reported, only to discover that statistical sleight-of-hand was used to hype non-existent growth (For a look at some interesting charts pertaining to growth and the likelihood of a double-dip recession click here, then click on one of the charts that comes up in your browser): "They’re at it again.  Permabulls and new bulls promoting the notion that a deep or sharp V-shaped recovery is well under way, using just-reported Q1 GDP data for support. Instead of noting that the headline figure of 3.2% annualized growth was down 40+%  from the Q4 growth rate of 5.6%, showing sharp deceleration in the so-called economic recovery, they’re saying that Q1 was the third consecutive quarter of positive growth following three quarters of negative growth, suggesting a picture of a balanced V-shaped recovery, precluding a double dip recession. "In fact, the GDP growth rate previously declined four quarters from its Q2 ’08 peak and six quarters from the NBER designated start of the recession in Q4 ’07.   Moreover, it declined seven quarters from the Q3 ’07 peak of what we define and carefully track as the core business cycle – see the first chart below. Still further, the shape of the recovery is much worse than suggested by even seven down quarters followed by three up quarters, since the rebound to date has retraced only 17% of the total decline, rather than the 42% suggested by a picture of a three-sevenths or greater retracement.   "Both permabulls and new bulls know, or should know, that a double dip recession, with its W-shaped bottom, starts with a V and is followed by a second V, so in any event the characterization of a V-shaped bottom doesn’t at all preclude much more complexly extended bottom formations.

Bob Bronson is a Colorado-based quant whose thoughts about the stock market and economy often go sharply against the grain.  He was the first guy we know of to predict the housing bust, and he tracked its development for more than a year before the pundits and mainstream media even acknowledged it. Here's a recent note from Bob: "The sovereign debt bubbles are another false Wall of Worry, like the supposed fear higher interest and/or inflation rates, for permabulls and new bulls to rationalize buying high (playing momentum) and/or not selling over owned, overvalued and overbought equities.  Massive net selling by insiders irrefutably demonstrates that they certainly don’t agree.  Bailouts of sovereignties, (countries, states and even counties and cities) is qualitatively different than bailing out overleveraged, and technically insolvent, private sector banks, especially mixed with too-big-to-fail and intermingled, and underregulated, shadow banking intermediators like AIG, in fractional reserve based monetary systems.  Greece, the PIGS et al, have plenty of assets, unlike CitiGroup and AIG, for example, to collateralize central bank loans at reasonably less than market interest rates.  The financial media’s hyped concern on this is nonsense and not a meaningful case for the bears, or the bulls, just entertainment value for non-institutional investors and observers."

For those who  believe Mr. Obama has put America on a destructive course, here are some rousing words from Canadian David Solway. Click here to access Solway's eloquent and passionate essay at FrontPageMag.com.

At www.blue-eyes.com, a terrific Web site created by one of my oldest friends, Rick Apt, our own Michael Johnston has weighed in with his picks for the Top 10 Worst Sinatra Reprise-Era Songs. Too bad the selections didn't cover the Columbia era ten years earlier, since that's when Frank cut a track that surely marked the bottom of his illustrious recording career.  I am referring, of course, to the infamous "Mama Will Bark," which Frank did as a duet with...Dagmar.

I took pains yesterday morning in the touts section of Rick's Picks to explain how we might exploit a potentially tradable development in June Gold. Although the opportunity did not pan out exactly as we’d hoped, it came close. I have analyzed the trade in detail in this 10-minute recording.

Our man on the scene, Jonathan Auerbach of Auerbach & Grayson, has eyes and ears everywhere -- including in Ghana, which he refers to as "the new African tiger."  Jonathan turned up there yesterday, lunching with a presidential advisor who knows all about the Boston Celtics.  Here's a summary of what he learned:  "Yesterday, Cadman Mills, Senior Economic Advisor to President of Ghana John Atta Mills stopped by for lunch and provoked us and entertained us for 2 hours as well as reminding me that he knew as much as I about the Celtics since he received his Ph.D at BC. You must think about Ghana as the new African Tiger. If you last heard that the Jubilee Field had proven reserves of 500 million barrels (official Ghana estimates) forget about it. When asked directly about reserves Mr. Mills allowed that Tullow Oil was now estimating 1.8 billion barrels in Jubilee and then he smiles and said, "We now think it's larger than that" He spoke at length about their role in delaying the Kosmos sale of their Jubilee interest to XOM plainly stating that there is a national interest on the development of their resources that was clearly overlooked (much of this occured during the recent electoral transition). "Look this country that spent $2 billion to import oil just 2 years ago will be an oil exporter in 2011 (maybe) and is now embarking on plans that will include infrastructure (rail, deep-water port, power grids), industrial, urbanization, agricultural, and resource (cocoa, gold, manganese, bauxite) development. Growth rates are projected up to double digits next year, the CEDI is firm, and interest rates while still high have been cut significantly lately.So let's go to the chart of the SE index (attachment above). Why does it look that way? The market is opaque

Another good-humored look at the world through stock charts from our friend and paid-up subscriber, Jonathan Auerbach.  Click here  for Auerbach & Grayson's latest technical report, which bears a title that recalls author Tom Clancy at his paranoid best:  The Sum of All Charts.

A recent Reuters analysis expands on the points made in today's commentary, which concerned the undiscounted market risks of a war between Israel and Iran.  Click here  to access the article.

Click here   for the latest "Special Alert" from my good buddy Garrett Jones.  His bearishness at the moment stems not only from his fine technical work, but from the old adage, "Sell in May, and go away."