We feel it appropriate to help distribute Karl’s video response to the currently in vogue effort of the government-subsidized media to discredit those AMERICANS who question current government policy and who suspect that the economy will get worse before it gets better:

Who wudda thunk it? Mish appears to have joined Dennis “The Recession is Over” Kneale.  Mish declares the “bottom is in” for GDP although hedging, calling it a “recoveryless” recovery and suggesting the possibility of a double dip later.  As more and more people throw in the towel and “buy in” to the recession is over mantra, the top of the bear market rally should appear.

Dennis “The Recession is Over” Kneale tries to shout down Karl Denninger when Karl soundly argues that Government spending , along with the BEA’s revisions, are the main reason for the GDP growth NOT being reported at around -5.0%.  We don’t thnk Dennis was very successful…He winds up falling back on the fact that the S&P is up as “proof” that the GDP report is accurate…  What do you think?

(ht The Big Big Bet)

CNBC’s Dennis Kneale declared the recession to be over…

then lambasted “cowardly anonymous bloggers” for jeering his declaration:

Karl Denninger, a not-so-anonymous blogger, calls Dennis an idiot, then:

OK, now on to the facts – your idiotic and utterly unsupportable “the recession is over” call.

There are two types of recessions, if you happen to know more about economics than you knew about options a year ago, when you were caught asking on the air “what’s the VIX?”

The types of recessions are inventory driven recessions, the most common, and credit driven recessions.

The last material credit driven recession was in the 1930s.  We called it the “The Great Depression.”

Recessions cannot end until the conditions that caused the recession are removed from the economy.  This is elementary logic and obvious to anyone with an IQ larger than their shoe size.

This is not about what I believe Dennis, this is about mathematical facts.  Real GDP has taken a 4.83% contraction already from consumers alone – now add into this the pass-through effects on manufacturing and service output from unemployment and the numbers are even worse.  It matters not what the government cooks up – what matters is what people actually do.

Finally, on your so-called “Golden Cross”; for it to be valid the 200MA and 50MA must be rising.  The 200MA is falling; ergo, it is a false signal.  Go look at some charts; this indicator is no better than a coin toss if the second condition, which you conveniently omitted, is absent.  Better yet, talk to a market technician that knows his butt from a hole in the ground.  I do a nightly technical video available on my forum and pointed this out several days ago.

We reckon the “debate” between government-subsidized CNBC and the “cowardly bloggers” will continue for some time, but we wonder how long the recession has to continue before CNBC must admit that it was wrong and throw poor Dennis under the bus…If we still have over 10% unemployment this time next year, can the recession still be spun as “over”… as of… now?  The clock is ticking.