Despite the false report of unemployment dropping to 8.3% from 8.8% in the January Bureau of Labor report released this month, the administration continues to trumpet a recovery, and Obama’s approval polls are said to be rising. Despite reporting that 1.2 million people dropped out of the work force, and despite the main stream media refusing to acknowledge the impropriety in the numbers, we haven’t given up on reaching the Obamabots before they reach the voting booth. The truth of the Obama recovery is that it is all a lie…all of it. They are making it up, and recovery is not happening. As Disraeli said, there are three kinds of lies: lies, damned lies and statistics.
GaltStock explains the “seasonal adjustment” that allowed the miracle of 8.3% unemployment to happen:
This “seasonal adjustment” number was higher than any used in the last three years. If the BLS had used the average of the last three years, unemployment would not have dropped and Non-Farm jobs added would have only been 132,000, which would have been less than the 140,000 expected by the market.
Table C in the BLS release tells us how the worker bees at the Labor Department were able to massage the numbers to come out with the headline number they wanted. They increased the “Civilian noninstitutional population” by 1,685,000.
Remember, citizens that have not looked for work in the last four weeks are not counted as unemployed. The Labor Department calls these individuals “marginally attached” rather than unemployed. To get the unemployment percentage to drop this “Not in labor force” number was increased by 1,177,000
This dropped the labor force participation rate by 0.3%, to a new 30-year low of 63.7% and viola, the unemployment rate dropped to 8.3%…These adjustments are all about not counting people that want to work but can’t find a job else the unemployment rate would be astronomical.
If the political appointees and bureaucrats at the Labor Department add just a little over 4% more people to the “marginally attached” group, they can end up with a 0.0% unemployment rate by Election day! Oh happy day.
If you thought the market was manipulated by banks and high frequency traders…be suspicious of the information you believe that may not be accurate. What would the market have done last Friday if the Non-Farm payrolls number would have come in low, and unemployment rose?Read the entire article at GaltStock and view the BLS tables (which I could not get embedded into this post)
How about lower unemployment figures? Fitzgibbon [Highlander Fund] says they are a “joke.” He says that the Bureau of Labor Statistics has “completely changed the … metrics as of January 2012. None of the current percentages are relatable to anything prior to 2012!” He points out that the January unemployment data are heavily adjusted for “seasonal variations.” He notes that “the actual data [show that the economy] lost 2.7 million jobs in January.” And that’s just the numerator.
For the denominator — the number of people in the workforce — the data “also shows about 1.2 million people magically left the workforce.” He says one has to go back to the early 1980s to see labor force participation as low as it is now.
…we joked when we said that for Obama to get the unemployment rate to negative by election time, all he has to do is to crush the labor force participation rate to about 55%.
Looks like the good folks at the BLS heard us: it appears that the people not in the labor force exploded by anunprecedented record 1.2 million.
No, that’s not a typo: 1.2 million people dropped out of the labor force in one month! So as the labor force increased from 153.9 million to 154.4 million, the non institutional population increased by 242.3 million meaning, those not in the labor force surged from 86.7 million to 87.9 million. Which means that the civilian labor force tumbled to a fresh 30 year low of 63.7% as the BLS is seriously planning on eliminating nearly half of the available labor pool from the unemployment calculation.
Of course the argument that government cannot create jobs remains (just ask the 100,000s of Wall Streeters looking for blogs to write for thanks to Dodd-Frank perhaps?). Bloomberg’s outstanding Chart of the Day sums it all up nicely as the incredible rise in Financial Regulators continues. Since 2004, the number of federal employees at financial regulators will have almost doubled to 20,805 in 2013 – with the FDIC dominating the gains. What is also interesting is DoubleLine’s Gundlach’s recent observation (via Cato) that Federal employees earn almost twice what private employees do on average. Well done government.
Ah, but how about the comely stock market? Don’t say you haven’t been warned:
The market today sits on a precipice at all times. High speed computers are checking every trade and block order looking for an anomaly. When they see an outlier, the computer programs takes over issuing buy or sell orders…
Even if we knew what they were looking for, we couldn’t process information fast enough to compete with them. We only see the vapor trail of their actions. The high-speed computer rooms see every order as it is submitted to the market. We don’t see it until it hits our screen as a trade….Source: GaltStock (snippets from What is the Trigger)
Begin with “gains” in the stock market. Fitzgibbon explains that they are no indication of changes in the public mood because the public isn’t doing the investing anymore. He notes that HFT (high frequency trade computers) now “account for 80 percent [of the market's] daily business. No one else is left because they lost their money in 2008 and the public has fled the market … Total NYSE volume is 67 percent lower on average than in 2008. Volume is 29 percent lower this year compared to 2011. The prices [have] no serious meaning.”
The recovery that isn’t happening includes auto sales and house sales – read it at the Dick Morris link above.