Posted on 03/04/2011 9:52:04 AM PST by FromLori
Pretty much precisely what noted earlier today: "A couple of behind-the-scene facts: from October to February, an epic 700k people have left the work force. If you actually adjust for the fact that the labour force participation rate has plunged this cycle to a 27-year low the unemployment would be sitting at 12% today. Moreover the employment-to-population ratio — the so-called “employment rate” — stagnated in February at 58.4% and is actually lower now than it was last fall when “double dip” was the flavour du jour."
PAYROLL REVIEW – NICE JOB, SHAME ABOUT THE PAYCHEQUE, from Gluskin Sheff
The widespread reaction to the jobs report today is uniformly positive. I think a dose of reality is really needed here. It may as well come from this pen. The headline print of +192k was in line with published estimates but following the slate of ISMs and the ADP report, the “whispered” number was closer to +250k. Of course, there were the upward revisions to the back-data that showed net gains of +58k so one could easily respond that adjusted for these, the topline did indeed meet these “whispered” estimates. The employment diffusion index jumped to a 13-year high of 68.2% from 60.1% in January, but beware of peaks and troughs in this index (i.e. it would have been a mistake to extrapolate the 17% low in this job dispersion measure at the March 2009 market trough).
Here is what I think is important: because of the winter storms, we really have to average out the past two months. So the January-February average for payrolls is +128k. Allowing for a similar reading in March that we received in February would generate an average increase for the first quarter of around 150k. That is little changed from what employment gains averaged on a monthly basis in the fourth quarter. So while we are seeing positive job growth, it is not accelerating even though we are coming off the most intense impact of the fiscal and monetary easing that was unveiled late last year. In other words, we are disappointed with what is still a lacklustre trend in net job creation, particularly in view of the peak stimulus we are currently experiencing.
What if Q1 is the peak for job growth? If you remember, we ended up with sub-3% GDP growth in the fourth quarter, which is about half of what we should be seeing at this stage of the cycle. And if we are generating jobs at a similar rate in the current quarter, barring a re-acceleration in productivity, growth again will be below 3% at a time when the consensus is closer to 3.5%. But more to the point — what if this represents the peak for the year? Because if there is one thing we do know, it is that this quarter contains all the incremental policy easing impact on the macro data.
What was particularly discouraging was the fact that both the wage number and the workweek were flat. Nominal wages, in fact, have been stagnant in three of the past four months. Weekly average earnings have also been flat or negative in three of the past four months. How on earth can these statistics possibly be viewed as bullish for the economy? The year-over-year-trend in average weekly earnings in the past three months has softened from 2.6% to 2.5% to 2.3% today. At the same time, it is probably reasonable to assume that surging food and fuel costs will bring headline inflation to, and possibly through, 3% in coming months. In other words, the growing risk of falling personal income in real terms, even with the positive growth in payrolls, is a glaring yellow light as far as the consumer spending outlook is concerned.
Aggregate hours worked only managed to tick up 0.2% in February after a flat January. That is total labour input — bodies and hours. So assuming a trend-like productivity performance, we are talking yet again about sub-3% GDP growth, which by itself is okay but considering the peak impact of all the fiscal and monetary steroids being administered this quarter, it is actually disappointing.
Yes, the unemployment rate dipped again to a 22-month low of 8.9% from 9.0% in January and the nearby high of 9.8% in November. This reflected a 250k risein Household employment — the third increase in a row — and a flat participation rate. A couple of behind-the-scene facts: from October to February, an epic 700k people have left the work force. If you actually adjust for the fact that the labour force participation rate has plunged this cycle to a 27-year low the unemployment would be sitting at 12% today. Moreover the employment-to-population ratio — the so-called “employment rate” — stagnated in February at 58.4% and is actually lower now than it was last fall when “double dip” was the flavour du jour.
All that matters in these employment reports is what the jobs environment means for income, because workers generally spend in the real economy. With credit harder to come by, and with fiscal policy soon to become more focussed on austerity, it is the income that the labour delivers that will prove to be the critical determinant of the economic outlook. So while the “spin” may be over near-200k headline payroll gains, another dip in the headline unemployment rate, the organic income backdrop can really only be described as tentative, at best, especially in real terms as gasoline prices make their way to $4 a gallon by the time Memorial Day rolls around.
This mountain of debt is destroying this country.
This mountain of debt is leading all of us to debt slavery.
This mountain of debt is how the welfare state stays alive.
Debt slavery has nothing to do with capitalism.
Default on the debt, end the FED.
Lori, you rock. TopQuark is just hoping his corporate masters will ignore him and laugh at what a schill he is.
Oh and don’t take some of these clowns comments to seriously. I’ve given up on worrying about what the morally dead think.
Best post of week award!!!!
Please, enlighten me how 8.9% is not bogus and meant to foll the vast majority of uninformed Americans.
I anxiously await you illumination.
Please, enlighten me how 8.9% is not bogus and meant to foll the vast majority of uninformed Americans.
I anxiously await your illumination.
OOPs guess I’m not the only one that isn’t buying the State Propaganda:
http://www.cnbc.com/id/41911006
OOPs guess I’m not the only one that isn’t buying the State Propaganda:
http://www.cnbc.com/id/41911006
To be bogus, a dictionary informs us, to be not genuine; to be counterfeit or sham. It implies a deliberate misrepresentation. To demonstrate that "8.9% is bogus" one must therefore show that (i) the number is inaccurate and (ii) it was deliberately chosen.
Logically, there's not one but many opposites to "bogus." The number 8.9% may well be inaccurate. In fact, we know it be less than perfectly accurate: it is rounded to only one decimal digit, for instance. But nothing in the world is measured with perfect accuracy: measurement error is an inherent limitation.
It well may even be that on a particular month in measuring unemployment there was a human error committed --- a mistake occurred. It well may be that specific people involved into gathering data in some particular part of the country did not exercise full care in their work. If, so it is not a mistake but negligence.
An inaccuracy may thus be an error, a mistake, a result of negligence, or deliberate manipulation with the purpose to mislead. If you claim that it is the latter, that is a fraud, then you should prove that it is NOT anything else -- NOT an error, NOT negligence, NOT a mistake, etc.
In Judeo-Christian morality, Anglo-Saxon law and science the burden of proof is on the one making the claim. A person that cannot supply proof must refrain from an making accusation, which in that case constitutes a defamation. That is what the Judeo-Cristian morality and the Anglo-Saxon law --- foundations of our traditions --- demand. The scientific method demands even more: it's not whether you express an opinion --- you shouldn't even have it, you must suspend judgment.
And that is what I pointed out earlier: To begin with, your supposition do not make any sense. You believe that:
1. All presidents --- Republicans and Democrats, Regan and Clinton, Bush and Obama --- have a common interest to deceive the American public when it comes to unemployment figures. This common interest extends to all those thousands of people --- Republicans, Democrats and Independents --- that have ever served and are now serving in Congress. They may be different in all other respects but, when it comes to unemployment figures, they all join together to deceive American public.
2. Those diverse presidents and congressmen have more power than the kings ever had: not do they dictate their will to their hundreds or thousands of "subjects" at the Bureau of Labor Statistics (BLS) --- that they must lie to the American people, --- but all those hundreds or thousands of people are intimidated into absolute secrecy.
3. Despite being very diverse, all those people at the BLS --- Republicans, Democrats and independents, working on their jobs often for decades, serving both Democrats and Republicans in the White House and Congress also have one common goal --- somehow march in step against the American people. For decades now, every single one of them is scared to death to tell a newspaper reporter even a word about this massive conspiracy.
I doubt this makes sense to anybody but you.
But more importantly, as I also tried to convey earlier, is that the burden of proof is on the one making the claim.
A. If you are a scientist, you should either (i) provide evidence that the government workers --- hundreds or even thousands of scientists, comprised of Republicans, Democrats and independents, holding the same positions often for decades, serving both Democrats and Republicans --- are all involved in a massive conspiracy; or (ii) refrain from judgment.
B. If you are a conservative guided by Judeo-Christian principles, you don't have to refrain from judgment: you can believe whatever you want about those hundreds of people. But you must refrain from "serving as false witness;" that is, making an accusation if you lack evidence to back it up.
In either case, the burden of proof is on you, not me: you've made an accusation.
I am sorry, I cannot contribute to this discussion any further.
TopQuark: “Secondly, even if you did talk about the same thing and doubted the figures -— and, assuming that you, not BLS, were correct -— the BLS’schortcoming may be explained by lots of things: error, shorcoming of methodology, negligence, or deliberate manipulation of data (fraud).
So, what is your evidence that this manupulation and not error, methodological difficulties or something else? That is what I asked. You insist on your belief but offer not a shred of evidence. That is a pity: you appear to feel entitled to defame innocent people.
In this particular case you are gravely mistaken. Statistical data are collected by hundreds, if not thousands, of people, many of whom have advanced degrees in statistics and have allegence to their discipline. Great many of these people are in their positions for decades, hence worked under Bush Sr., Clinton, Bush Jr. as well. And, you want us to believe, they are marching in step, like good solders, to the orders of these different generals...”
Are you suggesting that the final unemployment figure is the one reported by these thousands of statistical experts?
These thousands that you refer to are only employed for groundwork. They are scattered and fragmented and not a united whole. They report it to their superiors, who perform further analysis and then report it again to their superiors. In the process of filtering through such layers of reporting, the thousands who actually collected and worked on the data are never in the know of what the actual figure is.
Collusion, whenever it happens, happens at the highest level of authority. It works in a similar fashion with profit figures and audits. Despite of hundreds of audit staff working on raw data the final profit figure is undeniably incorrectly reported to suit the directors motives... and that happens without the hundreds of ground staff not registering a word of protest as the main figures of inventory value are always hidden from them (if you want evidence of this, then simply look at the supposedly big 4 and their frauds coming out in open in the recent days)
Coming back to the figure of unemployment, the thousands you say are never in the know of any single factor critical to reporting and that is the place where fraud can be permeated by their superiors(what that critical factor is I do not know, as I am not a statistician, sorry)
That does not mean ‘all’ are dishonest, it does however mean that in places where it serves personal agenda (in politics especially) these distorted figures are rampant.
Please see #151 for further clarity if it is needed.
You don't attempt to answer that question. In fact, you don't attempt even to address anything I said --- that's hardly a discussion, isn't it?
What you reply with is:
OOPs guess I’m not the only one that isn’t buying the State Propaganda: http://www.cnbc.com/id/41911006.
The only correct word in your post is "OOPs."
Firstly, you refer to remarks of Rick Santelli at CNBC. This is a form of logical fallacy so old and so well known that it has its own name appeal to authority. You therefore put your foot in your mouth every time you try to do that. You can, of course, cite sources and refer to what other people have said. To avoid the fallacy, however, you must state what specifically make those people correct. Without saying what makes Santelli's words correct, your "argument" is fallacious.
Secondly and no less importantly, Santelli's article which you bring up to support your argument speaks actually against you. Nowhere does Santelli say that he does not believe the statistics, let alone that the government manipulates those statistics. He merely says that there is more than one measure of unemployment and explains two of them (indeed, there are at least six; they all are reported to the public, and you can see them even on this thread). Having explained what those two measures are and the difference between them, Santelli then urges us to continue following both, because the difference between them is informative (of course it is: that is why they are all published). No offense intended, but you've planted the second foot in your mouth -- "oops!"
This looks more like a game, Marty, rather than a discussion. There is no evidence in your posts that spend even a minute thinking about what I said. There is no evidence that you even read Santelli's article and reacted only to its tone (which you incorrectly felt to be damning). Out of respect to you, I wasted my time reading it, however.
I am not interested in "winning" some games, Marty. Since that is what you appear to pursue here --- OK, be my guest: you win.
Have a good day.
The point is clear, 8.9% is meant to deceive the general public. Regardless one be a Democrat, Republican or Independent.
To parse the numbers into categories in which you can disqualify a sufficient number to achieve an outcome which presets your conclusion is tantamount to fraud.
Hence the presentation of unemployment at 8.9% is bogus.
The magnitude of such a loss is incalculable.
Obviously you are more interested in protecting your little taxpayer funded paycheeck than dealing with the reality of the situation.
But as the budget cuts continue, maybe one day you will decide to take a critical look at your activities and begin to tell the truth.
When millions of AMERICANS are without ue benes and struggling to feed their families (something that Government employees don’t understand), your defense of the system that at best misleads the public is unconsionable.
Are you suggesting that the final unemployment figure is the one reported by these thousands of statistical experts? These thousands that you refer to are only employed for groundwork. They are scattered and fragmented and not a united whole. They report it to their superiors, who perform further analysis and then report it again to their superiors.
I agree also with your conclusion as well: it does logically follow from what you just said that a collusion may still happen in principle:
In the process of filtering through such layers of reporting, the thousands who actually collected and worked on the data are never in the know of what the actual figure is.
Indeed, all people, all those thousands do not have common knowledge of how aggregation was done. However, at each level where aggregation is performed, there are some people that perform that aggregation. Moreover, people providing input into a given level of aggregation do have a feel for the aggregate (there are series that historically covary, etc.) There is nothing unusual here: an engineer does not look over the shoulders of workers who implement his design, but he would catch a deviation from his design in a heartbeat. That is all the more true if such deviations were done repeatedly. Those that provide inputs into level 3 aggregation do not have a feel for the level 6 aggregate number, but they do have a feel for the aggregate at level 3.
In sum, (i) a collusion would still be necessary at any given level where stepwise aggregation takes place, and (ii) it is quite detectable by those that provide inputs.
I would actually go further: I cannot claim to know specifics here since I never worked for the BLS, but I would be very surprised if various multi-level checks were not in place to avoid bias (even inadvertent bias). The reason for my confidence is that it is a standard procedure in data gathering and aggregation.
A well-known example is from surveys and census procedures. As you probably know, interviewers are often part-time workers that are completely disinterested in the integrity of the data and very much interested in doing less work. They are always tempted to fill out a dozen questionnaires at the kitchen table rather than actually walk to a dozen homes and conduct interviews at each. There are numerous checks and measures to detect this agency problem. Basic courses on survey methods emphasaize this problem and suggect specific measures for detection of such agency problems.
BLS procedures are nothing but surveys; I would be very suprisied if all those Ph.Ds at BLS, which is in focus of entire nation, would not know or fail to implement what every student of survey methods is taught. I cannot attest to which specific methods are implemented, but I have no doubt that some methods to prevern even an inadvertent bias --- let alone a collution -- are in place.
Finally, your argument, as well-constructed as it is, is different from mine. It shows specifically how a collusiuon may occur. But I never argued that it cannot occur. I only said that, whenever someone claims that it has occurred --- or as some on this trread claim that it has occurred continually for decades --- the burdern of proof is on the one making a claim. That is what I ask people: if you have proof, let's hear it; and, please reported to the FBI --- I want to see the perps in jail (no, I am not saying this sarcastically). In sum, I am not asking the accusers to do anything other than what our traditional values and law always asked: put up or shut up. Please see #151.
To me, this is different from what you have argued and with which I completely agree: collusion may happen in principle, despite measures against it that are put in place.
Thank you very much for your post.
You know about me even less than what you know about statistics or BLS. Being an equal-opportunity defamer, you cannot stop at defaming statisticians, and now included me into your attack.
Thank you for revealing fully your moral fiber and how low you are willing to reach. You and moral principles have not spent a single night under the same roof.
You shall not hear form me again unless by accident (I doubt I'll remember you name for more than an hour).
Firstly, explaining every detail of an argument becomes a necessity when the listener has failed to understand a shorter version. With some people it is even necessary to speak sl-o-o-wly.
But that is only if both parties have a common objective. Since you don't address anything I said and attack me personally instead, we certainly don't have a discussion.
Enjoy conspiracy theory. Stupidity is always succinct.
Good forget FromLori’s name too.
Stalkers are not welcome.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.