The Real Economic Numbers: 21.5% Unemployment, 10% Inflation And Negative Economic Growth

TEC ^ | 06/12/2018 | Michael Snyder

[SeekAndFind]

Every time the mainstream media touts some “wonderful new economic numbers” I just want to cringe. Yes, it is true that the economic numbers have gotten slightly better since Donald Trump entered the White House, but the rosy economic picture that the mainstream media is constantly painting for all of us is completely absurd. As you are about to see, if honest numbers were being used all of our major economic numbers would be absolutely terrible. Of course we can hope for a major economic turnaround for America under Donald Trump, but we certainly are not there yet. Economist John Williams of shadowstats.com has been tracking what our key economic numbers would look like if honest numbers were being used for many years, and he has gained a sterling reputation for being accurate. And according to him, it looks like the U.S. economy has been in a recession and/or depression for a very long time.

Let’s start by talking about unemployment. We are being told that the unemployment rate in the United States is currently “3.8 percent”, which would be the lowest that it has been “in nearly 50 years”.

To support this claim, the mainstream media endlessly runs articles declaring how wonderful everything is. For example, the following is from a recent New York Times article entitled “We Ran Out of Words to Describe How Good the Jobs Numbers Are”…

The real question in analyzing the May jobs numbers released Friday is whether there are enough synonyms for “good” in an online thesaurus to describe them adequately.

So, for example, “splendid” and “excellent” fit the bill. Those are the kinds of terms that are appropriate when the United States economy adds 223,000 jobs in a month, despite being nine years into an expansion, and when the unemployment rate falls to 3.8 percent, a new 18-year low.

Doesn’t that sound great?

It would be great, if the numbers that they were using were honest.

The truth, of course, is that the percentage of the population that is employed has barely budged since the depths of the last recession. According to John Williams, if honest numbers were being used the unemployment rate would actually be 21.5 percent today.

So what is the reason for the gaping disparity?

As I have explained repeatedly, the government has simply been moving people from the “officially unemployed” category to the “not in the labor force” category for many, many years.

If we use the government’s own numbers, there are nearly 102 million working age Americans that do not have a job right now. That is higher than it was at any point during the last recession.

We are being conned. I have a friend down in south Idaho that is a highly trained software engineer that has been out of work for two years.

If the unemployment rate is really “3.8 percent”, why can’t he find a decent job?

By the way, if you live in the Boise area and you know of an opening for a quality software engineer, please let me know and I will get the information to him.

Next, let’s talk about inflation.

According to Williams, the way inflation has been calculated in this country has been repeatedly changed over the decades…

Williams argues that U.S. statistical agencies overestimate GDP data by underestimating the inflation deflator they use in the calculation.

Manipulating the inflation rate, Williams argues in Public Comment on Inflation Measurement , also enables the US government to pay out pensioners less than they were promised, by fudging cost of living adjustments.

This manipulation has ironically taken place quite openly over decades, as successive Republican and Democratic administrations made “improvements” in the way they calculated the data.

If inflation was still calculated the way that it was in 1990, the inflation rate would be 6 percent today instead of about 3 percent.

And if inflation was still calculated the way that it was in 1980, the inflation rate would be about 10 percent today.

Doesn’t that “feel” more accurate to you? We have all seen how prices for housing, food and health care have soared in recent years. After examining what has happened in your own life, do you believe that the official inflation rates of “2 percent” and “3 percent” that we have been given in recent years are anywhere near accurate?

Because inflation is massively understated, that has a tremendous effect on our GDP numbers as well.

If accurate inflation numbers were being used, we would still be in a recession right now.

In fact, John Williams insists that we would still be in a recession that started back in 2004.

And without a doubt, a whole host of other more independent indicators point in that direction too. The following comes from an excellent piece by Peter Diekmeyer…

Williams’ findings, while controversial, corroborate a variety of other data points. Median wage gains have been stagnant for decades. The U.S. labour force participation rate remains at multi-decade lows. Even our own light-hearted Big Mac deflator suggests that the U.S. economy is in a depression.

Another clue is to evaluate the U.S. economy just as economists would a third world nation whose data they don’t trust. They do this by resorting to figures that are hard to fudge.

There, too, by a variety of measures—ranging from petroleum consumption to consumer goods production to the Cass Freight Index—the U.S. economy appears to have not grown much, if at all, since the turn of the millennium.

In the end, all that any of us really need to do is to just open our eyes and look at what is happening all around us. We are on pace for the worst year for retail store closings in American history, and this “retail apocalypse” is hitting rural areas harder than anywhere else…

This city’s Target store is gone.

So is Kmart, MC Sports, JCPenney, Vanity and soon Herberger’s, a department store.

“The mall is pretty sad,” says Amanda Cain, a teacher and mother. “Once Herberger’s closes, we’ll have no anchors.”

About two-thirds of Ottumwa’s Quincy Place Mall will be empty with Herberger’s loss.

Of course it isn’t just the U.S. economy that is troubled either.

We are living in the terminal phase of the greatest debt bubble in global history, many nations around the globe are already experiencing a very deep economic downturn, and our planet is literally in the process of dying.

So please don’t believe the hype.

Yes, we definitely hope that things will get better, but the truth is that things have not been “good” for the U.S. economy for a very, very long time.

Michael Snyder is a nationally syndicated writer, media personality and political activist. He is the author of four books including The Beginning Of The End and Living A Life That Really Matters.

[Theoria]

The economy has been in disorder for decades. Our economy cannot function without our .gov running a deficit. Nobody wants stop the music when it comes to debt. Our interest on the national debt continues to climb.

[MadMax, the Grinning Reaper]

Does the US Employment figures include US citizens employed “overseas”, say in Saudi Arabia, Chile, So. Africa, Egypt, Israel, India, etc?

They supposedly pay US income taxes and most have US home addresses or are still citizens, so are they counted?

I have no idea.

[SomeCallMeTim]

My company hires trucking company drivers to move goods to US ports .. over the past year, it has become increasingly difficult to find drivers. Yesterday, I approved paying a 2x normal rate to find drivers before the end of this quarter. Still, they say they can’t find any.

This economy is booming.

The guy is right about inflation numbers though. It’s much higher than the 2% they keep telling us. But even that depends on what kinds of things you buy.

[A_perfect_lady]

We are being conned.

Uhm... no, I don't think so. Full time students are not working, but they are not "unemployed." Stay at home mothers whose husbands are supporting the family are not "unemployed." Trust fund babies and successful people who retired in their 50s are not "unemployed." He's just arbitrarily saying that everyone between 18 and 65 must be working or it's a catastrophe. No, it's not.

[FLT-bird]

I’d say he overstates it. Its true that the labor participation rate is 4% lower than it was in 2000. Part of that is all the people the Obama administration tried to not count by making it easy to claim disability. Some MAY be baby boomers who are not yet at official retirement age but who have done well enough and retired early. A LOT of it was people who desperately wanted to work but who were long term unemployed during the Great Recession. The government then claimed they “gave up”....without ever bothering to ask them if they did....so that they could then not count them as unemployed.

3.8% is obviously not accurate and the real unemployment rate is higher. It IS consistent with how it was counted during the Obama administration however and the MSM gave him a free pass for it so its tough to now cry foul when the Trump administration counts it the same way.

Since I’m a consultant and am therefore frequently in contact with headhunters and companies to do projects I can tell you at least as far as the labor market is concerned the Great Recession started in 2007, not 2008. Companies knew what was coming and stopped hiring. It was simply AWFUL from 2007 until about 2015 when the market got a little better. Then around the Fall of last year things really started improving. That was the very first time I could see the job market getting back to where it had been before the Great Recession.

Things are good now but its still going to take time to work through the backlog of the awful Obama years. There ARE more people out there who want to work and who can work....but companies are going to have to do something they desperately don’t want to do which is hire people who have been out of a job for sometimes a year or more. I think companies are ridiculous about this, but they act like if you went through a tough time somehow you are damaged goods...or that your job skills all magically disappeared if you went without a paycheck for that long or longer. Maybe in normal times you *might* be able to infer a lack of drive but considering the Obama economy was THE WORST economy in three whole generations, maybe its time to drop the snootiness about that.

Oh and yes inflation is more than the government is admitting - as we all know. On the bright side, pay has actually increased in the last year for the first time in many many years....another sign that the job market is not absolutely in the toilet like it was during the Obama years.

It cannot be emphasized enough just how rotten things were when Obama was in office and making policy.

[FLT-bird]

Correct. This was too inconvenient for the MSM to admit though. Just like all the dodges used to not count long term unemployed as unemployed (disability fakers or they lying claim that they “gave up”), they also counted highly qualified people who had to take burger flipper jobs as being “employed”...which they were sort of..and earning maybe one quarter of what they would’ve been earning in a normal economy......

But of course they were unwilling to talk about Barry’s failures.

[FLT-bird]

His friend in Idaho doesn’t count as “unemployed”. He “gave up” you see.......Nobody asked him if he gave up but the government claims he did.

He didn’t magically forget everything. We haven’t had some sea change in technology. I’m sure he could do that job for a company that would care to hire him, but lots of companies will have to get really desperate before they do since he was unfortunate enough to be unemployed for a long time during the horrible Obama economy.

[FLT-bird]

The MSM painted themselves into a corner by covering for Obama. He fudged the numbers left, right and center. He then pumped out ridiculous lies about how the unemployment rate was only 5% or whatever. Of course we knew that was BS and the real percentage as at least twice that. The MSM knew it too

but what to do when Trump just continues using the exact same measures Obama had been using? Does the MSM say “yeah we were completely full of crap in what we’ve been telling you for 8 years because we were unwilling to pry Obama’s *cork* out of our mouths....but NOW we’re prepared to tell you the truth about the economy.....”

Obviously they can’t say that - even though it would be true.

[Rockingham]

Well-placed, upscale malls continue to thrive, but the general trend is against malls in favor of online retailing and cheaper, more flexible strip shopping centers. In addition, lower crime rates and diminished racial strife reduce the attractiveness of the higher level of security that malls commonly provide. With the economy otherwise growing, dead malls are a sign of what Schumpeter famously described as the "creative destruction" of entrepreneurial capitalism.

To be sure, economic statistics these days are subject to a host of issues and there are still too many long-term discouraged and displaced workers who need to get back into employment. An era of strong labor demand and low immigration should mostly remedy most long-term unemployment.

[FLT-bird]

A final note.....the bank I’ve been working for is absolutely LOADED with Indians. I mean just jam packed. You wouldn’t believe how many. I have nothing against Indians per se. My best friend’s family is from there even though he was born and raised in the US....but frankly there should not be nearly as many Indians working for this bank. Those office jobs should be filled by Americans.

and no, these are not super qualified tech geniuses who are doing all sorts of fancy computer engineering either. We’re talking accountants, auditors, project managers, etc. Stop importing all these people. Start pushing Americans toward getting these kinds of qualifications (ie business, finance and accounting majors) and then start hiring them. I do think we need to curtail H1B visas though for that to happen. Yes that may well make costs go up a bit. So be it.

[CurlyDave]

The only people in my rural burg who are not working are those who don’t want to.

Some of them say they want a job, but then they get more tats, and their attitude sucks.

There are lot of people in this world who would rather hustle than work.

[metmom]

Every time the mainstream media touts some “wonderful new economic numbers” I just want to cringe. Yes, it is true that the economic numbers have gotten slightly better since Donald Trump entered the White House, but the rosy economic picture that the mainstream media is constantly painting for all of us is completely absurd.

I am skeptical of this article because of the opening sentence.

There is no way on God's green earth that the liberal media is going to paint a rosy picture of the economy, or anything else that would make Trump look good.

I've seen the concerted effort they've made to downplay one of the most significant historical events we've seen in decades, the progress with North Korea, and they are treating it as a big nothing burger.

They've doing everything they can to NOT give Trump credit for it and to downplay it's significance.

No way they'd be faking economic numbers if it were going to look good for Trump.

So things are happening. Whether it's as good as Trump portrays or not is another question. What with how statistics can be manipulated, it's almost impossible to tell anything for sure.

[FreedomPoster]

SSDI became a career path during the Obama years. Not a good thing.

[miniTAX]

Indeed. Stupid claims typical of greenies like “our planet is literally in the process of dying” are enough to be sure the author is full of it.

[abb]

Yesterday, Mrs. abb & I drove from North Louisiana to Johnson City, TN, via I-20, I-59 & I-40. I cannot recall in my lifetime of travels seeing as many trucks on the road as I did yesterday. Even before daylight, many, many trucks.

[RegulatorCountry]

This guy writes like a short seller, all disaster all the time. Kind of like that hair-on-fire guy that was popular back in 2008, what was his name, Denninger? The Market Ticker. Always screeching disaster. Of course, in 2008 it wasn’t too awfully hard to seem psychic screeching disaster. But, he was a short and this guy sounds just like him.

[Right Wing Assault]

Yes, I know the numbers are phony, but once the dems change the standards it is hard to switch to the real ones and make it look as if things got worse under Trump.

[trebb]

So many false memes it's a wash - just the bit about ...If the unemployment rate is really “3.8 percent”, why can’t he find a decent job? doesn't take into account that many with no skills are unwilling to take jobs that pay them what they're worth in order to start building credentials....

Everyone wants a good paying job w/o doing the footwork to qualify for the job...

[Right Wing Assault]

There are software companies in Idaho?

Yes, and Boise, Idaho, is home of Micron, one of three DRAM chip makers.

From an article, "The company generated $20 billion in revenue last year, putting it among the world’s five largest semiconductor companies, ahead of better known companies like Nvidia and Texas Instruments."

http://www.idahostatesman.com/news/business/article133887514.html

Another: "Boise is the fastest-growing area in the U.S., Forbes says. And it will keep growing."

http://www.idahostatesman.com/news/local/article202865919.html

[Sirius Lee]

There is a lot of B.S. in this piece.

There sure is. Pointing to the loss of dinosaur anchor stores like JC Penny as evidence of a depression, completely ignores the rise of online shopping and big box stores that do it better (Walmart).