Make Believe

"Guangzhou is a chemical weapons plant masquerading as a fertilizer plant. We know this. The Chinese know that we know. But we make-believe that we don't know and the Chinese make-believe that they believe that we don't know, but know that we know. Everybody knows."
--Travis Dane (Under Siege II)

As world markets sell off this morning, the media is pointing at a miscalculated Chinese leading indicator series as the primary culprit.

Because any measure contains error, some random and some systemic, data that form a series should be viewed with some skepticism. Aggregate economic series generated by government sources are even more likely to be jaded due to political motivations to do so.

As such, it never ceases to amaze me a) how much faith collective markets seem to place in the numbers released by Washington et al. and b) how much 'surprise' markets express when admission of error inevitably surfaces.

position in SPX