If You Read These Stats and Still Have Faith in Them, I've Got Some MBSes I Want to Sell You at a Great Price.


Reality is slippery, for sure. Especially when you're trying to grasp it via stories like this one that are based on the data provided:

The unemployment rate dropped unexpectedly in January to 9.7 percent from 10 percent while employers shed 20,000 jobs, the government said Friday.

The rate dropped because a survey of households found the number of employed Americans rose by 541,000, the Labor Department said.

The job losses are calculated from a separate survey of employers. The report also included an annual revision to the estimates of total payrolls, which showed there were 930,000 fewer jobs last March than previously estimated.

The department also revised down its estimates for April through October of last year, adding another 433,000 job losses.

The November figure was revised higher, however, to show a gain of 64,000 jobs.

All told, the Great Recession has eliminated 8.4 million jobs, the department said. That's the most of any recession since World War II as a proportion of total payrolls.

Whole thing here.

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  2. Why would anyone hire when they have no idea what sort of crazy ass regulations or new taxes they are going to have to pay for in the near future? This is on top of the bill that they know is coming for the “stimulus package”.

    1. Productivity and revenue are up for MGM. MGM just got a buy rating. Might be like that across the board.

      1. By what rating agency?

        1. I forget. I work for them and they have these tv’s that are set on a loop around the employee corridors. That announcement above was playing about a week ago.

    2. Probably because they need employees to do work?

  3. Still, a figure less than the inconveniently round number of 10% will be spun without shame by all the usual suspects.

    1. It’s clear proof the stimulus worked.

      1. And we’re just getting started!

        1. I was kidding.

          1. I comprehend your potato.

  4. Let me see if I understand this. The current employment figures are based on colonoscopy results and were interpreted by an East Anglia think tank?

    1. A colonoscopy performed by Steve Smith.

    2. Let me show you my “hockey stick”…

  5. So, the recalculations show that 1.3 million more jobs were actually lost than had been previously reported, but the unemployment rate magically goes down?

    W . . . T. . . F?

    1. the unemployment rate magically goes down?

      Oh yes, Honey, I magically go down.

      Then you’ll get the screwing of your life!

    2. L . . . I. . . E.

    3. My guess is the job losses had been counted as taking place later in the year.

      1. Sure, sure, I understand that job losses come from one survey (of businesses), and the unemployment rate comes from another (of households).

        I still find it incredible that we can say that we actually lost 1.3 million more jobs last year than we previously thought, but the unemployment rate is down. That tells me that one or the other of these surveys sucks hairy balls. I’m guessing its the household survey, because I would expect the data from the industry survey to be better data, less susceptible to “value-added” adjustments.

        1. People I run into tend to like the establishment (industry/payroll) survey more, because it has a larger sample size (about 400,00) and a wonderful benchmark (the Quarterly Census of Employment and Wages, which lags a couple quarters but covers every job paying Unemployment Insurance).

          However the establishment survey data is self-reported by the firms in the sample. The household survey has a big phonebank of people calling respondents directly. Both, however, use imputation (making stuff up, with science!). The household survey, for instance, depends on things like the Census (and intercensal estimates assembled from a host of administrative data sources like counts of births and deaths) being correct.

          And I’ll second the comments below about the establishment survey by definition not including all kinds of working people, like farm employees and the self-employed (it also double counts people holding multiple jobs).

          It’s enough to compare the level differences to see the disparity, even without fussing over over-the-month movements:

          Household Employment seasonally adjusted: 138,333,000
          Establishment Employment seasonally adjusted: 129,527,000

          That discrepency has always existed and always will, and you guys are complaining about a few 100,000s of discrepency between the over-the-month data? It’s a definitional difference. Save your ire.

    4. “People who are jobless, looking for jobs, and available for work are unemployed.”

      Jobs and unemployement can both go down as long as the number of discouraged workers goes up.

  6. the Great Recession has eliminated 8.4 million jobs

    So we’re really going with “Great Recession”? In caps and everything?

    Was Xtreme Downturn XL 5000 already trademarked or something?

    1. PepsiCo already called dibs on that for the Great Mountain Dew Shortage of 2016.

    2. Was the text of the Post story revised, or is it the wrong link? It doesn’t mention “Great Recession” anymore.

  7. I saw a regular on CNBC yesterday ask rhetorically why Greece didn’t just print their way out of their problems for now… Did he not know that Greece is a Euro country? Did he not know that Greece doesn’t control the Euro? I don’t know, but it’s painfully clear, he didn’t know what he was talking about…

    There’s no question that there are a lot of journalists out there covering the financial markets and the economy who have no idea what they’re talking about, but I’m not sure that’s such a bad thing. Because if the alternative is people only writing about what they know about, then that might mean stories just wouldn’t get covered…

    And there are some doozies, right now.

    The apparent stupidity of the Obama Administration, which is calling for the separation of investment activity from normal banking activity–even as it retains some of the key people (such as the head of the FDIC) who absolutely forced some of these behemoths together less than a year ago in order to stabilize the banking sector.

    There’s the Obama Administration and friends going on about how curbing the investment activities of these banks will prevent another similar collapse–when the investment activities of banks had almost nothing to do with the financial crisis. It was banks–regular old banks–making good old fashioned bad home loans… Hello? Is anybody out there?

    There are the charges filed yesterday against current and former BofA executives saying that they failed to disclose the losses of Merrill Lynch–a sale that was apparently forced on them under threat by Paulson, Geitner and others–we may finally get to the bottom of that story yet… Did the federal government force BofA to buy Merrill? How much do you need to know about the markets to cover that story well?

    But none of these stories are being covered widely, and I think it’s just because so many journalists don’t know anything about the financial markets. …so maybe this is one of those times that people really should write about stuff they know nothing about, because, otherwise, hardly anyone will ever know about these stories at all.

    1. which is calling for the separation of investment activity from normal banking activity

      Not exactly, it’s a paul volker idea but isn’t in the house bill… arguably there is a real conflict of interest between prop trading and brokerage (as was seen in the GS portal scandal) but seperating prop from other trading is impossible to enforce.

      1. Miss the forest much?

        The OTC seized WaMU, Shelia Bair sold it in a secret auction to Morgan, and justified what she did by saying it was necessary to stabilize the banking sector……..S_and_FDIC

        She’s in the Obama Administration now. Now she wants them separated? What changed since September of 2008?

        What did Morgan’s investment activity have to do with the banking crisis?

        The correct answer is “nothing”.

        So why are they going after them?

        The correct answer is that it has nothing to do with what’s good for the economy (even if there are good arguments in favor of what they’re trying to do) and it has everything to do with bonus payouts at investment banks. The Obama Administration is going on a witch hunt and doesn’t give a rip what it does to the banking sector or the economy, so long as it gets them some populist votes…

        But hardly anyone’s covering that story. …or they’re just rehashing what they’ve been told…just like the reporter (and editor, presumably) who doesn’t know anything about how unemployment is calculated up yonder.

  8. OK this is actually making pretty good sense to me dude, I like it.


  9. obviously the feds need to spend MORE to get those ‘multipliers’ to kick in.

  10. Does anybody take these numbers seriously?

    I do not.

  11. In all countries, surveys tell us there are more married women than married men, and the gap is growing wider.

    Situations prone to different interpretation exist not only in relationship of a man and a woman, but also in relationship of an employer and an employee.

  12. the transparency goggles…they do nothing

  13. I watched the “instant analysis” on CNBC this morning; what a lot of incoherent babbling. So there’s at least some entertainment value.

  14. Explanation:
    The survey of employers does not include self-employed those with typically five or fewer employees (the number varies by state) who don’t have to file for unemployment insurance. It is not that uncommon, specifically when there is relatively little change in the number of jobs for household survey and employer survey to diverge.
    Part the employer survey includes a model of new businesses being formed that take a while to get into the survey. The model, which works fairly well in normal times, did not perform as well last spring. This is why we have always had benchmark revisions as more compelte data becomes available.

  15. Just for the record, it really is scary to see the Obama Administration trying to terrorize banks at this point in the economic cycle. And it bothers the hell out of me that his stupid, populist witch hunt is likely to prolong the agony of the recovery, particularly in regards to unemployment…

    But you know what’s even scarier that that?

    Whatever the Obama Administration’s cure is for unemployment! I don’t even want to see it! Whatever it is, I’m sure it will suck investment and consumption out of the economy for decades after the worm has turned on the economic cycle. …dollars to doughnuts, I’d bet.

  16. God forbid the Obama Administration actually did anything about unemployment!

    1. Sure enough, I see the headline on TV…

      $100 Billion Jobs Bill: Right Move?

      He’s gonna take money from the investment banks (because they caused all of this-NOT!), and give it to community banks? Really? …because the government’s so much better at knowing where sustainable economic growth is going to come from in the future?

      I think I’m gonna be sick.

  17. The reason the unemployment number went down is because another huge swath of people became disgruntled and stopped looking for employment. Hey, if you’re not looking, you’re no longer unemployed! So the easy way to fix this is for all the people looking for a job to just stop looking.

    1. How fitting – the unemployment rate only goes down when people give up Hope.

  18. The November figure was revised higher, however, to show a gain of 64,000 jobs.

    Was there a particular reason for that, or was it just done to make the number look better?

  19. The November figure was revised because more complete data was available.

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