Last week, we had gross domestic product (GDP) numbers for the last quarter as well as employment numbers for last month. While the GDP number was touted to be great, the employment numbers disappointed the uninformed.

GDP, which shows a country's growth trajectory, was claimed as strong, at 1.7 percent growth. Last quarter, the growth was at 1.1 percent and previous quarter was at 0.1 percent. As you can see, this is not the stuff champions are made of.

For the past two months, we have had a barrage of analysts buy into the story by the Federal Reserve that they will be reducing their bond buying beginning in September. I have never believed this story and have written to you about the whole 'tapering' story having no legs.

Now all the analysts are switching the story to say that tapering will now start in December. I do not believe that to be true either. With Fed Chairman Ben Bernanke riding off into the sunset in January, we will need to have the new chairman own the program, so I expect the tapering to be real, if it happens, by March 2014.

That will give enough time for the new government tampering to take hold.

Starting in July, the U.S. government started a new lie to pull wool over our eyes. They are revising how they calculate GDP and adding a bunch of dubious calculations just to show that the U.S. GDP number is healthy and that we are growing as a nation.

So how is GDP really calculated?

GDP = private consumption + gross investment + government spending + (exports − imports), or

GDP = C + I + G + (X - M)

The government has now made a significant change in the gross investment number (I), which now includes research and development (R&D) spending, art, music, film royalties, books and theatre. This change in GDP statistics has not been implemented elsewhere in the world. So the United States is the first to accomplish this rewriting of the GDP number.

R&D spending, which shouldn't even be accounted for as investment, adds a significant amount to the GDP number — it accounts for around 2 percent of U.S. GDP. Art, music, film royalties, books and theatre add another 0.5 percent.

Another adjustment has been made to pension accounting. Previously, pension spending was included in GDP. After this adjustment, however, we also look at the "promise" to pay out pensions. So we are talking about imaginary numbers that are now included in GDP.

A last example is found in real estate. Commissions, legal bills and expenditures on real estate transactions are included in GDP as "investment." Obviously these expenditures aren't associated with real production.

You also need to know that the GDP numbers were already "massaged" if we look at real GDP. Real GDP is nominal GDP, but inflation adjusted with the Consumer Price Index (CPI).

As we all know, the CPI has a hedonic adjustment applied to it, which adds a multiplier to different asset classes in the CPI. The total sum of this hedonic adjustment creates a lower CPI, which makes the real GDP look bigger. In other words, the government is masking the inflation numbers. If we now take into account the recent adjustment in the GDP number, we have a double incremental effect on real GDP.

So all in all, get ready to be fooled again! The new "GDP" will be about 3 percent higher than the old GDP. Make sure you deduct this 3 percent in October to know the real growth rate.

Strangely enough, the Dow Jones Industrial Average will soar when the fake GDP number is announced in October.