Lukey
Senator
Which would seem better stated "great news for job seekers" or "great news ON jobs" but I digress.
The conundrum is how to reconcile this "great news for jobs" with a sliding, stilted, stagnating economy. We keep seeing these great jobs reports being generated by the BLS algorithms but the economy is only barely growing. Are we over stating job creation, or under stating GDP? That's the kind of question a bona fide economic thinker asks, rather than just regurgitating and praising BLS statistics as gospel come down from the mount. I don't have the time or frankly the ability to properly answer this question. Fortunately, Jeffry Snider has done so for me, and those of us who are interested in the economic truth, rather than the "official" massaged, or tortured version. And I was right (all along) - the numbers just don't add up:
Economists have been saying for over a year that the unemployment rate is and was meaningful; more meaningful, in fact, than market prices in funding and credit that increasingly doubted the full narrative. Those markets have been proven increasingly correct as the labor statistics fall further and further toward irrelevance. How likely is it that they have been accurate and the economy just falls apart while businesses are hiring and expanding labor utilization at a rate not seen since Bill Clinton’s last term? Occam’s Razor alone would suggest the productivity interpretation, that the BLS has simply been overstating labor gains for years. That would actually fit quite well within both the decrepit recovery picture, the one that has caused Main Street to near political revolt, and the onrushing recession.
The only other statistical possibility is that the BEA has been understating GDP, a question that is increasingly settled by further and broader contraction throughout the economy. If anything has been overstated it is by far the belief in the “best jobs market in decades”; it simply cannot be found in even the BLS’s own more removed numbers. That it will not reconcile with the BEA’s output figures nor the increasingly negative world we see around is leaves so very little doubt in that respect. The jobs market just wasn’t there; how could it have been? It never made sense and a closer inspection easily reveals it never added up, either.
That explains why economists were so wrong about 2015 because they were depending on phantom jobs in order to forestall very real market-driven and market-suggested danger. There is no productivity mystery, only a distinct and illegitimate lack of curiosity on the part of economists to simply take the Establishment Survey as gospel regardless of how little it fit the rest of the world. It also calls into question the legitimacy of the FOMC and monetary policy that was certainly subject to, and predicated upon, the same quackery. No matter how little the payroll reports described the economy as it was, including the relation to GDP, they held on to nothing else to instead deny everything. And some continue to.
http://www.zerohedge.com/news/2016-02-05/robust-job-growth-doesnt-make-sense-and-numbers-show-why
Click the link for Jeffrey's walk through the math...
The conundrum is how to reconcile this "great news for jobs" with a sliding, stilted, stagnating economy. We keep seeing these great jobs reports being generated by the BLS algorithms but the economy is only barely growing. Are we over stating job creation, or under stating GDP? That's the kind of question a bona fide economic thinker asks, rather than just regurgitating and praising BLS statistics as gospel come down from the mount. I don't have the time or frankly the ability to properly answer this question. Fortunately, Jeffry Snider has done so for me, and those of us who are interested in the economic truth, rather than the "official" massaged, or tortured version. And I was right (all along) - the numbers just don't add up:
Economists have been saying for over a year that the unemployment rate is and was meaningful; more meaningful, in fact, than market prices in funding and credit that increasingly doubted the full narrative. Those markets have been proven increasingly correct as the labor statistics fall further and further toward irrelevance. How likely is it that they have been accurate and the economy just falls apart while businesses are hiring and expanding labor utilization at a rate not seen since Bill Clinton’s last term? Occam’s Razor alone would suggest the productivity interpretation, that the BLS has simply been overstating labor gains for years. That would actually fit quite well within both the decrepit recovery picture, the one that has caused Main Street to near political revolt, and the onrushing recession.
The only other statistical possibility is that the BEA has been understating GDP, a question that is increasingly settled by further and broader contraction throughout the economy. If anything has been overstated it is by far the belief in the “best jobs market in decades”; it simply cannot be found in even the BLS’s own more removed numbers. That it will not reconcile with the BEA’s output figures nor the increasingly negative world we see around is leaves so very little doubt in that respect. The jobs market just wasn’t there; how could it have been? It never made sense and a closer inspection easily reveals it never added up, either.
That explains why economists were so wrong about 2015 because they were depending on phantom jobs in order to forestall very real market-driven and market-suggested danger. There is no productivity mystery, only a distinct and illegitimate lack of curiosity on the part of economists to simply take the Establishment Survey as gospel regardless of how little it fit the rest of the world. It also calls into question the legitimacy of the FOMC and monetary policy that was certainly subject to, and predicated upon, the same quackery. No matter how little the payroll reports described the economy as it was, including the relation to GDP, they held on to nothing else to instead deny everything. And some continue to.
http://www.zerohedge.com/news/2016-02-05/robust-job-growth-doesnt-make-sense-and-numbers-show-why
Click the link for Jeffrey's walk through the math...
