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Posted by THE-BEAKER on 02-03-12 01:55 PM:

Record 1.2 Million People Fall Out Of Labor Force In One Month

and back in the real world -

Record 1.2 Million People Fall Out Of Labor Force In One Month, Labor Force Participation Rate Tumbles To Fresh 30 Year Low



http://www.zerohedge.com/news/recor...n-rate-tumbles-

Posted by e92335i08 on 02-03-12 01:57 PM:

Yea, maybe the numbers are a little bit skewed.

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Posted by JamesL on 02-03-12 02:01 PM:

Well, that's one way to get the all important unemployment figures down to electable levels.

Posted by Tsing Tao on 02-03-12 02:07 PM:

"This is the largest absolute jump in 'Persons Not In Labor Force' on record...and biggest percentage jump in 30 years."

LOL....and the robots dive head-first into the market, frothing for the latest deals.

Posted by the1 on 02-03-12 02:08 PM:

By the time November rolls around the unemployment rate will be in the area of 6-7% as Obama proclaims, "we're on our way to full employment." Jobs for everyone!

Posted by Martinghoul on 02-03-12 02:19 PM:

It's good to see HeroZedge is up to its usual shenanigans. I guess the whole doomsday thing hasn't worked out that well, so they feel the need to get all defensive.

In reality, today's release was very strong by any measure. Household survey numbers (incl participation rate, unemployment rate, etc) are to be taken with a pinch of salt, due to the population count adjustment that BLS normally performs in January. So yes, unemployment rate drop of 0.3% and the household employment number jump of 847k are probably somewhat exaggerated. However, that doesn't change the fundamental dynamics that are, for the moment, obvious.

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Posted by MKTrader on 02-03-12 02:48 PM:

Quote from Martinghoul:

It's good to see HeroZedge is up to its usual shenanigans. I guess the whole doomsday thing hasn't worked out that well, so they feel the need to get all defensive.

In reality, today's release was very strong by any measure. Household survey numbers (incl participation rate, unemployment rate, etc) are to be taken with a pinch of salt, due to the population count adjustment that BLS normally performs in January. So yes, unemployment rate drop of 0.3% and the household employment number jump of 847k are probably somewhat exaggerated. However, that doesn't change the fundamental dynamics that are, for the moment, obvious.


Good to see the JV Team for the Fed/TBTF banks taking time out of practice and hazing to defend the Ministry of Truth. However, the numbers have been rendered near meaningless.

http://harpers.org/archive/2008/05/0082023

Posted by Tsing Tao on 02-03-12 02:53 PM:

MG, Please tell me how this is positive in any manner whatsoever.



Remember, also, MG - your precious Fed will have a much harder time printing away (at least overtly) with massaged data like your release stated.

Posted by Tsing Tao on 02-03-12 02:54 PM:

Quote from MKTrader:

Good to see the JV Team for the Fed/TBTF banks taking time out of practice and hazing to defend the Ministry of Truth. However, the numbers have been rendered near meaningless.

http://harpers.org/archive/2008/05/0082023


MG is just your garden variety Fed/ECB Apologist. He's not part of any public relations campaign

Posted by S2007S on 02-03-12 02:58 PM:

Im still questioning why there is even talk of keeping rates at 0% into 2014 and why even some fools think this economy needs QE3....if everything is all perfect why does BUBBLE ben bernanke still want to keep pumping up the economy with worthless dollars?

Posted by Martinghoul on 02-03-12 03:05 PM:

Quote from MKTrader:
Good to see the JV Team for the Fed/TBTF banks taking time out of practice and hazing to defend the Ministry of Truth. However, the numbers have been rendered near meaningless.

http://harpers.org/archive/2008/05/0082023

Fed/TBTF banks? I am an honest gal. You must have me confused with someone else, sir.

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Insofar as I may be heard by anything, which may or may not care what I say, I ask, if it matters, that you be forgiven for anything you may have done or failed to do which requires forgiveness...

Posted by Martinghoul on 02-03-12 03:11 PM:

Quote from Tsing Tao:
MG, Please tell me how this is positive in any manner whatsoever.

Remember, also, MG - your precious Fed will have a much harder time printing away (at least overtly) with massaged data like your release stated.

I am not suggesting it's positive or negative. I am suggesting that it's a number that is a result of a very specific BLS adjustment. Have you noticed how HeroZedge is normally exceedingly eager to point out any and all one-off adjustments that the BLS does when it suits them? However, when it casts doubt on one of their conclusions, mum seems to be the word. A paradox, innit?

__________________
Insofar as I may be heard by anything, which may or may not care what I say, I ask, if it matters, that you be forgiven for anything you may have done or failed to do which requires forgiveness...

Posted by Tsing Tao on 02-03-12 03:22 PM:

Quote from Martinghoul:

I am not suggesting it's positive or negative. I am suggesting that it's a number that is a result of a very specific BLS adjustment. Have you noticed how HeroZedge is normally exceedingly eager to point out any and all one-off adjustments that the BLS does when it suits them? However, when it casts doubt on one of their conclusions, mum seems to be the word. A paradox, innit?


You are focusing on ZeroHedge. I am focusing on the Labor Participation statistic, and still waiting on your explanation of it being "positive", by any definition of that word used on this planet.

You said "today's release was very strong". I'm waiting for you to back that up with how less people employed in the population is very strong.

Maybe "very strong" compared to Spain? Is that what you meant to say?

Posted by misterno on 02-03-12 03:26 PM:

not everybody is a citizen in america

there are millions of people actively searching for jobs but they only have working permit, like green card holders

I know many people who left US for their home country because they lost their jobs

Some of them will return if economy starts growing again

That partially explains the drop of $1.2MM

Back in the 90's in Boston, I met people in cafe shops around Harvard Sq who were on a tourist visa but actively looking for programmer jobs in IT. Back then you could change tourist visa to H1B easily. But thank god they changed that in 2001.

Posted by WS_MJH on 02-03-12 03:27 PM:

What you have to understand is Democrats and liberals don't care about the truth: they only care about perceptions. If the liberals can convince the American electorate that it's morning in America when the economy is the worse it's been in decades, what do they care. These people backstabbed troops to win Senate seats. These are people who considered 5% unemployment under Bush to be a depression. These are people who if Komen cuts funding to Planned Parenthood, it's a start of a jihad. They're nuts. The only thing I fear is that the American electorate really is dumb and will reelect him.

Posted by atticus on 02-03-12 03:36 PM:

Quote from Martinghoul:

I am not suggesting it's positive or negative. I am suggesting that it's a number that is a result of a very specific BLS adjustment. Have you noticed how HeroZedge is normally exceedingly eager to point out any and all one-off adjustments that the BLS does when it suits them? However, when it casts doubt on one of their conclusions, mum seems to be the word. A paradox, innit?


A case could be made that the BLS smoothes the data when it suits the administration. I really don't see the significance of ZH putting light to the obvious.

Posted by denner on 02-03-12 03:39 PM:

I remember going back and forth with Marting for weeks about the bogus inflation stats a year or so ago. Regardless of what he or she says, just about every talking point is a defense of central banks...I know that Martinghoul gets very defensive about that, but just about everybody on this thread has come to the same conclusion.

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Posted by Martinghoul on 02-03-12 03:40 PM:

Quote from Tsing Tao:
You are focusing on ZeroHedge. I am focusing on the Labor Participation statistic, and still waiting on your explanation of it being "positive", by any definition of that word used on this planet.

You said "today's release was very strong". I'm waiting for you to back that up with how less people employed in the population is very strong.

Maybe "very strong" compared to Spain? Is that what you meant to say?

I don't recall saying that the change in the participation rate was a positive. IIRC, I said that the number is suspect because it was the result of a one-off adjustment performed by the BLS. This applies to both "positive" (unemployment rate) and "negative" (participation rate) results that have come out of the household survey. In fact, if you adjust for the one-off January population controls, the labor force participation rate would have remained unchanged. The establishment survey data, on the other hand, was all positive, i.e. all the revisions were upwards; temp help services, which is normally a leading indicator, continued going up; gains in employment were broad-based, even with the courier strike and govt employment falling; etc etc. So, on balance, taking the household survey statistics with a grain of salt or adjusting it in a way that HeroZedge is so fond of, this was an undoubtedly positive report, which is what I said.

So that's for today's release. As to my general views on the labor participation rate, would you like me to comment?

__________________
Insofar as I may be heard by anything, which may or may not care what I say, I ask, if it matters, that you be forgiven for anything you may have done or failed to do which requires forgiveness...

Posted by Martinghoul on 02-03-12 03:46 PM:

Quote from atticus:
A case could be made that the BLS smoothes the data when it suits the administration. I really don't see the significance of ZH putting light to the obvious.

Not sure I see the logic there... Why is the BLS "smoothing" not mentioned in the HZ article on the labor participation rate? It's the "journalistic license" to claim "smoothing" when it suits the argument, but not when it doesn't. Moreover, when Ole Bill Gross jumps on the bandwagon, that's when I really having problems w/the argument.
Quote from denner:
I remember going back and forth with Marting for weeks about the bogus inflation stats a year or so ago. Regardless of what he or she says, just about every talking point is a defense of central banks...I know that Martinghoul gets very defensive about that, but just about everybody on this thread has come to the same conclusion.

Well, I'll be damned. Everyone on this thread disagrees with me! Whatever shall poor ole me do now, faced with such overwhelming odds? Clearly, if lots of people disagree with me, I shirly must be wrong.

As to me defending central banks. Here I thought in this case I was only having a beef with HeroZedge, rather than defending anyone. Even if I was defending anyone, it would have to be the US economy or maybe the BLS. Not really sure what this has to do w/the Fed, but then again, I must be missing stuff (see above).

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Insofar as I may be heard by anything, which may or may not care what I say, I ask, if it matters, that you be forgiven for anything you may have done or failed to do which requires forgiveness...

Posted by ammo on 02-03-12 04:10 PM:

Quote from Martinghoul:


. As to my general views on the labor participation rate, would you like me to comment?
always

Posted by Tsing Tao on 02-03-12 04:29 PM:

Quote from Martinghoul:

I don't recall saying that the change in the participation rate was a positive. IIRC, I said that the number is suspect because it was the result of a one-off adjustment performed by the BLS. This applies to both "positive" (unemployment rate) and "negative" (participation rate) results that have come out of the household survey. In fact, if you adjust for the one-off January population controls, the labor force participation rate would have remained unchanged. The establishment survey data, on the other hand, was all positive, i.e. all the revisions were upwards; temp help services, which is normally a leading indicator, continued going up; gains in employment were broad-based, even with the courier strike and govt employment falling; etc etc. So, on balance, taking the household survey statistics with a grain of salt or adjusting it in a way that HeroZedge is so fond of, this was an undoubtedly positive report, which is what I said.

So that's for today's release. As to my general views on the labor participation rate, would you like me to comment?


You are tap dancing around the issue. The overall issue is that the employment picture is not improving in any way, shape or form like the BLS suggests it is, and therefore the BLS data is grossly misleading at best, and an outright distortion at worst. Instead of speaking to that, you instead say the report was positive, because technically you are correct (and you know it). The numbers the report presents are, indeed, positive.

Posted by Tsing Tao on 02-03-12 04:32 PM:

Quote from Martinghoul:

Not sure I see the logic there... Why is the BLS "smoothing" not mentioned in the HZ article on the labor participation rate? It's the "journalistic license" to claim "smoothing" when it suits the argument, but not when it doesn't.


Because the BLS knows the media will not go to that level of detail, and why "smooth" something when there is no gain in doing it?

The headline number is what gets reported to the sheeple, and the smoothing serves that purpose, the same way each and every single week with almost no exception whatsoever shows weekly jobless numbers being revised up in the previous week. Why is it never revised down? Is that some sort of statistical anomaly?

Posted by Tsing Tao on 02-03-12 04:34 PM:

Quote from Martinghoul:



As to me defending central banks. Here I thought in this case I was only having a beef with HeroZedge, rather than defending anyone. Even if I was defending anyone, it would have to be the US economy or maybe the BLS. Not really sure what this has to do w/the Fed, but then again, I must be missing stuff (see above).


I think Denner's point is obvious. You're a known Fed/ECB apologist on these forums, and by extension of that knowledge, he's saying that you'd also align yourself with governmental statistics, institutions and the main stream media. In other words, you're on the same "team" with the same "agenda".

Posted by atticus on 02-03-12 04:38 PM:

Posted by trefoil on 02-03-12 04:45 PM:

The BLS numbers need to be interpreted, which is different from saying they are grossly misleading, distorted, or anything else of the sort.
MGs point is also rather obvious: the weight of the data is overwhelmingly on the side of an accelerating improvement in the jobs picture. As follows:

1 - Declining jobless claims.
2 - Increasing number of hours worked and...
3 - Increasing number of overtime hours worked.
4 - Upward revisions to the number of jobs added in previous months.
5 - Increased number of industries reporting gains in employment.
6 - Strong increase in private payrolls, stronger than the overall number reported.

In other words, all of the numbers underneath the headline number were strong. To say otherwise is to talk your book, which is pretty obviously short. Or at least that's what you'd like it to be.
On top of that, the ISM report showed an increased backlog in unfilled orders, which is positive for production in the months ahead. There is no evidence anywhere of an economy that is either losing steam or just maintaining a steady state. All of it points to an accelerating gain in production and employment in the coming months.
The market, meantime, has been telegraphing recovery throughout Jan: tech has been strong, the Russell 2000 has been screaming, and bonds had a horrible month. The message from both the jobs numbers and the markets is blindingly obvious.

Posted by Tsing Tao on 02-03-12 05:03 PM:

Quote from trefoil:

The BLS numbers need to be interpreted, which is different from saying they are grossly misleading, distorted, or anything else of the sort.
MGs point is also rather obvious: the weight of the data is overwhelmingly on the side of an accelerating improvement in the jobs picture. As follows:

1 - Declining jobless claims.
2 - Increasing number of hours worked and...
3 - Increasing number of overtime hours worked.
4 - Upward revisions to the number of jobs added in previous months.
5 - Increased number of industries reporting gains in employment.
6 - Strong increase in private payrolls, stronger than the overall number reported.



I'm not even going to waste time on your ISM/tech comments. That's not the subject of the debate here, so stop trying to change the topic.

As for the BLS numbers not being misleading, you're smoking some good shit (pass it over). The fact that the BLS can revise it's numbers based on a huge portion of people "giving up" in their look for a new job, means - by definition - that the numbers are misleading. They're supposed to be showing the unemployment figures, and they aren't giving the full picture of unemployment! It's pretty friggen clear I would think. I suppose we can try putting this argument into a pop-up book, but I don't know if the words will be any easier to read.

The fact that the BLS can use multiple methods of counting unemployment, and the media seize just the one (which happens to be the revised number showing the lowest unemployment calculations) means that it's slanted.

Posted by Martinghoul on 02-03-12 05:13 PM:

Quote from Tsing Tao:
You are tap dancing around the issue. The overall issue is that the employment picture is not improving in any way, shape or form like the BLS suggests it is, and therefore the BLS data is grossly misleading at best, and an outright distortion at worst. Instead of speaking to that, you instead say the report was positive, because technically you are correct (and you know it). The numbers the report presents are, indeed, positive.

Huh? I really don't understand the logic here. This report is positive and yet the employment picture is not improving? The BLS data is grossly misleading and yet, if you bother to look at the details the BLS releases, it's all there? I am sorry, but I just don't understand the point you're making.
Quote from Tsing Tao:
Because the BLS knows the media will not go to that level of detail, and why "smooth" something when there is no gain in doing it?

The headline number is what gets reported to the sheeple, and the smoothing serves that purpose, the same way each and every single week with almost no exception whatsoever shows weekly jobless numbers being revised up in the previous week. Why is it never revised down? Is that some sort of statistical anomaly?

Huh? Yet again, I don't get it. HZ is media, no? HZ goes into detail normally, right? Why is HZ not reporting on the smoothing that the BLS is engaging in here? Could it be, gasp, because the "smoothing" actually casts into doubt the nice sensationalist headline?

As to the claims, I haven't explored this issue properly, but, as I understand it, main reason for the revisions is some states reporting the number of claims late. Given the current state of the economy, I imagine the result is that revisions are upwards. Glancing at the old 2004-05 numbers, it seems plausible.
Quote from Tsing Tao:
I think Denner's point is obvious. You're a known Fed/ECB apologist on these forums, and by extension of that knowledge, he's saying that you'd also align yourself with governmental statistics, institutions and the main stream media. In other words, you're on the same "team" with the same "agenda".

Ah, I see... So, basically, this is a case of one grand super-conspiracy? The MSM, all the govt agencies, bloggers, like Ritholtz and CalculatedRisk, and, finally, yours truly, we're all on the same team, trying to further our nefarious "agenda"? What can I say? Yes, it's true, all true!! You can call me Dr. Evil!

__________________
Insofar as I may be heard by anything, which may or may not care what I say, I ask, if it matters, that you be forgiven for anything you may have done or failed to do which requires forgiveness...

Posted by shopster on 02-03-12 05:19 PM:

Quote from Tsing Tao:

You are tap dancing around the issue. The overall issue is that the employment picture is not improving in any way, shape or form...


period, end of subject....

s

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Posted by trefoil on 02-03-12 05:20 PM:

Quote from Tsing Tao:

I'm not even going to waste time on your ISM/tech comments. That's not the subject of the debate here, so stop trying to change the topic.

As for the BLS numbers not being misleading, you're smoking some good shit (pass it over). The fact that the BLS can revise it's numbers based on a huge portion of people "giving up" in their look for a new job, means - by definition - that the numbers are misleading. They're supposed to be showing the unemployment figures, and they aren't giving the full picture of unemployment! It's pretty friggen clear I would think. I suppose we can try putting this argument into a pop-up book, but I don't know if the words will be any easier to read.

The fact that the BLS can use multiple methods of counting unemployment, and the media seize just the one (which happens to be the revised number showing the lowest unemployment calculations) means that it's slanted.


The BLS is an extremely honest organization. They ain't the Fed, by a long shot.
And the ISM wasn't brought up to change the subject: it's supporting evidence. As in, if the BLS numbers were made up, the ISM would contradict them. But the ISM doesn't; it's consistent with what the BLS is reporting.
Of course, it does take a small amount of actual logical thought to connect the two. Truly, you're a dunce. I had thought you had at least some intelligence before, but I'm revising that opinion. You're right up there with Grand Supercycle and bwolinsky when it comes to soaring stupidity.

Posted by trefoil on 02-03-12 05:21 PM:

Quote from trefoil:

The BLS is an extremely honest organization. They ain't the Fed, by a long shot.
And the ISM wasn't brought up to change the subject: it's supporting evidence. As in, if the BLS numbers were made up, the ISM would contradict them. But the ISM doesn't; it's consistent with what the BLS is reporting.
Of course, it does take a small amount of actual logical thought to connect the two. Truly, you're a dunce. I had thought you had at least some intelligence before, but I'm revising that opinion. You're right up there with Grand Supercycle and bwolinsky when it comes to soaring stupidity.


Ditto for the markets, by the way. You know, the ones you're supposed to be trading & making money on? The whole point of this exercise?

Posted by Tsing Tao on 02-03-12 05:29 PM:

Quote from Martinghoul:

Huh? I really don't understand the logic here. This report is positive and yet the employment picture is not improving? The BLS data is grossly misleading and yet, if you bother to look at the details the BLS releases, it's all there? I am sorry, but I just don't understand the point you're making.


Once again, the BLS's U3 stat is conveniently managed to maintain the "illusion" that unemployment is much better than it actually is. It's not a coincidence that the media picks up on the U3 and only discusses it. I apologize, but I just don't know how to make that any clearer.

Quote from Martinghoul:


Huh? Yet again, I don't get it. HZ is media, no? HZ goes into detail normally, right? Why is HZ not reporting on the smoothing that the BLS is engaging in here? Could it be, gasp, because the "smoothing" actually casts into doubt the nice sensationalist headline?


You know perfectly well the difference between the main stream media and the blogosphere. If you "don't get it" then there isn't anything I can do to assist you in this.

Quote from Martinghoul:


As to the claims, I haven't explored this issue properly, but, as I understand it, main reason for the revisions is some states reporting the number of claims late. Given the current state of the economy, I imagine the result is that revisions are upwards. Glancing at the old 2004-05 numbers, it seems plausible.


So the revisions in those late reporting states always go up, then? Or the BLS doesn't include them at all when it reports the first time? That would certainly help the number print each and every time. I have an idea, let's delay half of the states, and we'll kill the number each time! Then next week when there's a 50% revision, no one will notice. It's old news.

Quote from Martinghoul:


Ah, I see... So, basically, this is a case of one grand super-conspiracy? The MSM, all the govt agencies, bloggers, like Ritholtz and CalculatedRisk, and, finally, yours truly, we're all on the same team, trying to further our nefarious "agenda"? What can I say? Yes, it's true, all true!! You can call me Dr. Evil!


If you would like, I shall call you such. But there are clearly two sides to the coin - without calling one right and the other wrong. There are those that believe that what the Fed is doing, and in government statistics, and there are those that believe the Fed is harming the country (and the world) and the statistics are not to be trusted. If that is a grand conspiracy, as you claim, then who am I to argue. I will go and get my foil hat at once.

Posted by Tsing Tao on 02-03-12 05:31 PM:

Quote from trefoil:

The BLS is an extremely honest organization. They ain't the Fed, by a long shot.
And the ISM wasn't brought up to change the subject: it's supporting evidence. As in, if the BLS numbers were made up, the ISM would contradict them. But the ISM doesn't; it's consistent with what the BLS is reporting.
Of course, it does take a small amount of actual logical thought to connect the two. Truly, you're a dunce. I had thought you had at least some intelligence before, but I'm revising that opinion. You're right up there with Grand Supercycle and bwolinsky when it comes to soaring stupidity.


Ah, here come the personal insults. You've run out of ammo, have you?

The best defense you have is that the BLS is an extremely honest organization, eh? And you've got this from a friend of a friend...or...wait, a relative works there? Your neighbor?

I'm not making an economical argument, which is why I said stop with the ISM. I'm focusing solely on the BLS's employment report, which I claim as misleading. If you are unwilling (or unable) to address my comments in that topic, meet me in the P+R forum and you and I can throw mud and feces properly.

Posted by trefoil on 02-03-12 05:32 PM:

More supporting evidence from the markets:



source: http://finance.yahoo.com/marketupdate/overview?u

Despite such positive sentiment this session, shares of utilities stocks are having a hard time attracting buying interest. In fact, the defensive-oriented sector is currently dancing along the neutral line while the broad market boasts a gain greater than 1%. The relatively weak performance by utilities stocks has been a recurring theme in recent weeks. As a result, the Utilities sector is actually down nearly 4% year to date, but the S&P 500 is actually up almost 7% since the start of the year. The sector's weakness comes after it climbed about 15% in 2011 to outperform every other sector.


But you can ignore it, 'cause you know, it's changing the subject.

Posted by trefoil on 02-03-12 05:35 PM:

Quote from Tsing Tao:

Ah, here come the personal insults. You've run out of ammo, have you?

The best defense you have is that the BLS is an extremely honest organization, eh? And you've got this from a friend of a friend...or...wait, a relative works there? Your neighbor?

I'm not making an economical argument, which is why I said stop with the ISM. I'm focusing solely on the BLS's employment report, which I claim as misleading. If you are unwilling (or unable) to address my comments in that topic, meet me in the P+R forum and you and I can throw mud and feces properly.


I don't have time to waste on yet another conspiracy stupe. Take it to someone who cares about your opinion. I can't imagine who would, but whatever. The world is full of suckers.
As for running out of ammo, this weekend I'll give this report the analysis it requires, and shred your argument properly. There's quite a bit more in that report, stuff people with real money look for to see if what's being reported is real. It's all there.

Posted by Tsing Tao on 02-03-12 05:50 PM:

Quote from trefoil:

More supporting evidence from the markets:



But you can ignore it, 'cause you know, it's changing the subject. [/B]


I'll ignore it because it has absolutely nothing to do with the discussion here, which, for your short attention span, is the misleading statistics in the BLS numbers.

Posted by Tsing Tao on 02-03-12 05:51 PM:

Quote from trefoil:

I don't have time to waste on yet another conspiracy stupe. Take it to someone who cares about your opinion. I can't imagine who would, but whatever. The world is full of suckers.
As for running out of ammo, this weekend I'll give this report the analysis it requires, and shred your argument properly. There's quite a bit more in that report, stuff people with real money look for to see if what's being reported is real. It's all there.


So you "don't have time to waste on yet another conspiracy "stupe" (whatever the hell that word is). But you'll have time this weekend. Sorry to hear you have such a boring weekend ahead. But I shall wait with baited breath.

Posted by Martinghoul on 02-03-12 05:53 PM:

Quote from Tsing Tao:
Once again, the BLS's U3 stat is conveniently managed to maintain the "illusion" that unemployment is much better than it actually is. It's not a coincidence that the media picks up on the U3 and only discusses it. I apologize, but I just don't know how to make that any clearer.

You don't have to apologize. I am not defending the media. I just don't see how it's the fault of the BLS or anyone who actually looks at the details that people and the media fixate on a particular number, while a whole plethora of other numbers are reported. Surely, given that all this data is released and widely available (and reported ad nauseam by the likes of HZ), the BLS is doing a really sh1t job of "managing" the data to maintain the "illusion". What sort of an "illusion" is it when journalists can see right through it?

You know perfectly well the difference between the main stream media and the blogosphere. If you "don't get it" then there isn't anything I can do to assist you in this.

I do know the difference, but what does that have to do with my point? Who's dancing arnd the issue now?

So the revisions in those late reporting states always go up, then? Or the BLS doesn't include them at all when it reports the first time? That would certainly help the number print each and every time. I have an idea, let's delay half of the states, and we'll kill the number each time! Then next week when there's a 50% revision, no one will notice. It's old news.

There is no need for exaggeration. If you read what I said carefully, I am sure you would see my point. Moreover, as you're aware, I'm sure, revisions that we're talking about are on the order of a few thousands and don't affect the 4-week moving average (which is what matters) in a significant manner.

If you would like, I shall call you such. But there are clearly two sides to the coin - without calling one right and the other wrong. There are those that believe that what the Fed is doing, and in government statistics, and there are those that believe the Fed is harming the country (and the world) and the statistics are not to be trusted. If that is a grand conspiracy, as you claim, then who am I to argue. I will go and get my foil hat at once.

Call me whatever you like, just don't call me Shirley. And yes, a grand conspiracy it is and tin foil hats 'r us!

BTW, as if on cue: http://www.businessinsider.com/here...or-force-2012-2

__________________
Insofar as I may be heard by anything, which may or may not care what I say, I ask, if it matters, that you be forgiven for anything you may have done or failed to do which requires forgiveness...

Posted by atticus on 02-03-12 06:38 PM:

It was a strong report. You gotta be a bit quixotic to make a bear-play based upon the supposition of massaged data. There really isn't a clear trade here as vol will continue to erode into Spring. So I guess the play is slightly short delta and short vol.

If nothing else it puts a floor under the market until the ECB drops another Tsar Bomba.

Posted by Martinghoul on 02-03-12 06:52 PM:

Quote from atticus:
It was a strong report. You gotta be a bit quixotic to make a bear-play based upon the supposition of massaged data. There really isn't a clear trade here as vol will continue to erode into Spring. So I guess the play is slightly short delta and short vol.

If nothing else it puts a floor under the market until the ECB drops another Tsar Bomba.

Yep, agreed... In rates, ironically, vol is already so low that the trade might almost to be long vol, in hopes that all sorts of fun stuff will happen (e.g. Fed raising rates early or smth like that). Other than that, it's not entirely clear, given it's already moved a lot. Maybe stuff like blues - golds steepeners in Eurodollars has more juice, but it's a bit problematic here.

__________________
Insofar as I may be heard by anything, which may or may not care what I say, I ask, if it matters, that you be forgiven for anything you may have done or failed to do which requires forgiveness...

Posted by Tsing Tao on 02-03-12 07:08 PM:

Quote from Martinghoul:

You don't have to apologize. I am not defending the media. I just don't see how it's the fault of the BLS or anyone who actually looks at the details that people and the media fixate on a particular number, while a whole plethora of other numbers are reported. Surely, given that all this data is released and widely available (and reported ad nauseam by the likes of HZ), the BLS is doing a really sh1t job of "managing" the data to maintain the "illusion". What sort of an "illusion" is it when journalists can see right through it?
[B]
I do know the difference, but what does that have to do with my point? Who's dancing arnd the issue now?
[B]
There is no need for exaggeration. If you read what I said carefully, I am sure you would see my point. Moreover, as you're aware, I'm sure, revisions that we're talking about are on the order of a few thousands and don't affect the 4-week moving average (which is what matters) in a significant manner.
[B]
Call me whatever you like, just don't call me Shirley. And yes, a grand conspiracy it is and tin foil hats 'r us!

BTW, as if on cue: http://www.businessinsider.com/here...or-force-2012-2


Ok, MG - you've exhausted me with your death from a thousand cuts. I yield.

My only point in this entire thread was, is and will continue to be that the BLS's much famed monthly release of Non-Farmed Payrolls is all about a number (the U3) which is the least accurate of the employment situation (since it excludes just about anyone except the generic "unemployed looking for work" category). And for a report that is supposed to be the pinnacle of employment reports, it is the most misleading. Whether that is due to the BLS and their emphasis on it (revising the U3 to it's current state) or the media, or the tooth fairy, is irrelevant.

Oh, and you're still a Fed apologist!

Posted by Martinghoul on 02-03-12 09:20 PM:

Quote from Tsing Tao:
Ok, MG - you've exhausted me with your death from a thousand cuts. I yield.

My only point in this entire thread was, is and will continue to be that the BLS's much famed monthly release of Non-Farmed Payrolls is all about a number (the U3) which is the least accurate of the employment situation (since it excludes just about anyone except the generic "unemployed looking for work" category). And for a report that is supposed to be the pinnacle of employment reports, it is the most misleading. Whether that is due to the BLS and their emphasis on it (revising the U3 to it's current state) or the media, or the tooth fairy, is irrelevant.

Oh, and you're still a Fed apologist!

Oooooh, look at that: http://www.ritholtz.com/blog/2012/0...rce-last-month/

On that note, you have yerself a nice w/e, sire... Have a chilled Chinese alcoholic beverage!

__________________
Insofar as I may be heard by anything, which may or may not care what I say, I ask, if it matters, that you be forgiven for anything you may have done or failed to do which requires forgiveness...

Posted by trefoil on 02-03-12 09:45 PM:

Quote from Tsing Tao:

So you "don't have time to waste on yet another conspiracy "stupe" (whatever the hell that word is). But you'll have time this weekend. Sorry to hear you have such a boring weekend ahead. But I shall wait with baited breath.


Eh, I'm middle aged, been married a quarter century, and the weather's too cold to do anything outside. Winter's when I do all the research stuff on the weekends, 'cuz there's nothing else to do.
Anyway, this won't take long. From what I see your headline's already been thoroughly trashed. The rest is going to be easy.

Posted by denner on 02-03-12 10:20 PM:

Quote from trefoil:

Eh, I'm middle aged, been married a quarter century, and the weather's too cold to do anything outside. Winter's when I do all the research stuff on the weekends, 'cuz there's nothing else to do.
Anyway, this won't take long. From what I see your headline's already been thoroughly trashed. The rest is going to be easy.


"Actual jobs, not seasonally adjusted, are down 2.9 million over the past two months. It is only after seasonal adjustments – made at the sole discretion of the Bureau of Labor Statistics economists – that 2.9 million fewer jobs gets translated into 446,000 new seasonally adjusted jobs." A 3.3 million "adjustment" solely at the discretion of the BLS? And this from the agency that just admitted it was underestimating the so very critical labor participation rate over the past year? - Charles Biderman.

Don't worry, I already know that you will call the source a "loon" or a "kook" and that the BLS is the most "honest organization around".

(everyone take note of how many times he'll reply with "stupid" and "conspiracy".)

__________________
wealth effect: stock market higher, health care costs higher, unemployment higher, food/energy prices higher, taxes higher, poverty higher, bonuses higher, foreclosures higher, homelessness higher, crime rate higher, bankruptcies higher, unsold cars higher... it's economics 101

Posted by ammo on 02-03-12 10:49 PM:

Quote from trefoil:

I don't have time to waste on yet another conspiracy stupe. Take it to someone who cares about your opinion. I can't imagine who would, but whatever. The world is full of suckers.
As for running out of ammo, this weekend I'll give this report the analysis it requires, and shred your argument properly. There's quite a bit more in that report, stuff people with real money look for to see if what's being reported is real. It's all there.
if its B.S.,it will take the public the weekend to figure out and by the end of friday they (whoever wishes to create bogus data,US gov agncies/banks)used the data to move the mrkt higher which is apparently what they wanted..pissing match data not important

Posted by denner on 02-03-12 10:56 PM:

Quote from ammo:

if its B.S.,it will take the public the weekend to figure out and by the end of friday they (whoever wishes to create bogus data,US gov agncies/banks)used the data to move the mrkt higher which is apparently what they wanted..pissing match data not important


(Throwing today's report aside)...what you suggest is exactly how it's been done for years. Data is always revised at some later date..all of those "seasonal adjustments, birth/death cycle" stuff gets stripped out and can then be used as a new benchmark to create another "upside surprise" at a later date. Of course who could forget the latter part of the Clinton years when the reports were literally released sometimes a day early "computer glitch", etc, etc...

It's an incredibly dirty business and the tentacles of the politico's are all over this stuff, regardless of what some loser troll like Tinfoil has to say on the matter.

__________________
wealth effect: stock market higher, health care costs higher, unemployment higher, food/energy prices higher, taxes higher, poverty higher, bonuses higher, foreclosures higher, homelessness higher, crime rate higher, bankruptcies higher, unsold cars higher... it's economics 101

Posted by Martinghoul on 02-03-12 11:51 PM:

Quote from Martinghoul:
Oooooh, look at that: http://www.ritholtz.com/blog/2012/0...rce-last-month/

On that note, you have yerself a nice w/e, sire... Have a chilled Chinese alcoholic beverage!

Sorry, but I just can't stop beating this particular dead horse... Here's CalculatedRisk: http://www.calculatedriskblog.com/2...e-actually.html

I am somewhat gratified to see that there are respected people out there who seem to share my opinion of HeroZedge.

__________________
Insofar as I may be heard by anything, which may or may not care what I say, I ask, if it matters, that you be forgiven for anything you may have done or failed to do which requires forgiveness...

Posted by Tsing Tao on 02-04-12 12:03 AM:

Respected, heh. You already mentioned both Barry and CR. I have a little respect for CR, but I've lost all my respect for Barry long ago. He's a shill. And for every article that they have both quoted ZH, I can show two that ZH put them in their place. Who is to say who is right when?

And since I have read both your articles, here is another one for you: NFP in relation to tax withholding.

Hopefully you'll take the time to listen and then offer some other blog to refute it. He makes some really good points - which of course you will dismiss to conspiracy, but have a listen even so.

Posted by Martinghoul on 02-04-12 12:09 AM:

Quote from denner:
"Actual jobs, not seasonally adjusted, are down 2.9 million over the past two months. It is only after seasonal adjustments – made at the sole discretion of the Bureau of Labor Statistics economists – that 2.9 million fewer jobs gets translated into 446,000 new seasonally adjusted jobs." A 3.3 million "adjustment" solely at the discretion of the BLS? And this from the agency that just admitted it was underestimating the so very critical labor participation rate over the past year? - Charles Biderman.

Don't worry, I already know that you will call the source a "loon" or a "kook" and that the BLS is the most "honest organization around".

Oh, come on, denner... Is ZH the only thing you read? Do you treat everything posted by ZH as gospel? The above is beyond silly.

__________________
Insofar as I may be heard by anything, which may or may not care what I say, I ask, if it matters, that you be forgiven for anything you may have done or failed to do which requires forgiveness...

Posted by Tsing Tao on 02-04-12 12:11 AM:

Quote from Martinghoul:

Oh, come on, denner... Is ZH the only thing you read? Do you treat everything posted by ZH as gospel? The above is beyond silly.


That wasn't ZH. That was Trimtabs - who has provided an enormous amount of relevant information and has been on Bloomberg, CNBC and a host of other shows, just as your revered Barry Ritholtz has.

Here's another one.

http://jessescrossroadscafe.blogspo...r-brushing.html

See, I can post blogs too!

Posted by Martinghoul on 02-04-12 12:19 AM:

Quote from Tsing Tao:
Respected, heh. You already mentioned both Barry and CR. I have a little respect for CR, but I've lost all my respect for Barry long ago. He's a shill. And for every article that they have both quoted ZH, I can show two that ZH put them in their place. Who is to say who is right when?

And since I have read both your articles, here is another one for you: NFP in relation to tax withholding.

Hopefully you'll take the time to listen and then offer some other blog to refute it. He makes some really good points - which of course you will dismiss to conspiracy, but have a listen even so.

I have heard of Biderman. He's the guy who was claiming at one point that the Fed PPT was holding the stock mkt up, isn't he? And if you think for a moment that he's the only guy out there collecting high-frequency tax withholdings data, you're sorely mistaken. If you'd like me to locate some charts, I will do so.

As to his points, I can respond, but this is getting rather tedious, don't you think? I am not really even sure what the point of this discussion might be. I have no disagreement with you about the various more general points. My main beef was with ZH spouting its usual sensationalist drivel and people blatantly talking their book when interpreting today's number. But at least people on this thread are in good company. Apparently, Bill Gross's tweets were very much in the same vein (or so I am told).

__________________
Insofar as I may be heard by anything, which may or may not care what I say, I ask, if it matters, that you be forgiven for anything you may have done or failed to do which requires forgiveness...

Posted by Martinghoul on 02-04-12 12:24 AM:

Quote from Tsing Tao:
That wasn't ZH. That was Trimtabs - who has provided an enormous amount of relevant information and has been on Bloomberg, CNBC and a host of other shows, just as your revered Barry Ritholtz has.

Here's another one.

http://jessescrossroadscafe.blogspo...r-brushing.html

See, I can post blogs too!

I googled the quote. The first link that comes up is this: http://www.zerohedge.com/news/trimt...ion-past-2-mont

And yes, as I said, I saw that the ZH article was quoting Biderman. I know of him and have no respect whatsoever for his opinions ever since his rants on the PPT from a couple of years back. Furthermore, I don't revere Barry Ritholtz, but I do like some of the stuff he posts. I really like (not revere) CR, which I think is one of the best blogs out there.

And, finally, I had no doubts that you can post links to blogs as well as I.

__________________
Insofar as I may be heard by anything, which may or may not care what I say, I ask, if it matters, that you be forgiven for anything you may have done or failed to do which requires forgiveness...

Posted by Tsing Tao on 02-04-12 12:26 AM:

Quote from Martinghoul:

I have heard of Biderman. He's the guy who was claiming at one point that the Fed PPT was holding the stock mkt up, isn't he? And if you think for a moment that he's the only guy out there collecting high-frequency tax withholdings data, you're sorely mistaken. If you'd like me to locate some charts, I will do so.

As to his points, I can respond, but this is getting rather tedious, don't you think? I am not really even sure what the point of this discussion might be. I have no disagreement with you about the various more general points. My main beef was with ZH spouting its usual sensationalist drivel and people blatantly talking their book when interpreting today's number. But at least people on this thread are in good company. Apparently, Bill Gross's tweets were very much in the same vein (or so I am told).


So you didn't listen to it. Ok, I see. Because if you had, you would have heard where he, himself, mentions other people out there collecting tax withholding data.

As for claiming the Fed was propping the stock market up, he was referring to the growth in the money supply, and QE. Ben Bernanke himself acknowledged that a beneficial effect of QE is a higher stock market.

I see you are pushing back from the table. That is fine, I have to take the wife out for a little Friday Night dinner anyway. But simply waving your hand dismissively when the information doesn't follow the "party line" doesn't make it not true.

Posted by denner on 02-04-12 12:30 AM:

Quote from Tsing Tao:

Respected, heh. You already mentioned both Barry and CR. I have a little respect for CR, but I've lost all my respect for Barry long ago. He's a shill. And for every article that they have both quoted ZH, I can show two that ZH put them in their place. Who is to say who is right when?

And since I have read both your articles, here is another one for you: NFP in relation to tax withholding.

Hopefully you'll take the time to listen and then offer some other blog to refute it. He makes some really good points - which of course you will dismiss to conspiracy, but have a listen even so.



Agreed, Barry is a complete shill.

The bottomline is that Martinghoul starts with the premise that all official statistics are correct and then collects data to support this worldview. I've witnessed it firsthand for several years now. Obviously, there are any number of other folks on here who have picked up on this tendency, otherwise I'd be called "paranoid" or "delusional".

btw, why haven't we addressed how every report is revised at a later date? Haven't we all argued about this stuff a million times already? or is today some groundbreaking new way of doing things that erases all of our valid concerns and critiques?

__________________
wealth effect: stock market higher, health care costs higher, unemployment higher, food/energy prices higher, taxes higher, poverty higher, bonuses higher, foreclosures higher, homelessness higher, crime rate higher, bankruptcies higher, unsold cars higher... it's economics 101

Posted by Martinghoul on 02-04-12 12:32 AM:

Quote from Tsing Tao:
So you didn't listen to it. Ok, I see. Because if you had, you would have heard where he, himself, mentions other people out there collecting tax withholding data.

As for claiming the Fed was propping the stock market up, he was referring to the growth in the money supply, and QE. Ben Bernanke himself acknowledged that a beneficial effect of QE is a higher stock market.

I see you are pushing back from the table. That is fine, I have to take the wife out for a little Friday Night dinner anyway. But simply waving your hand dismissively when the information doesn't follow the "party line" doesn't make it not true.

I listened to parts of it and I will listen to the whole thing, since you insist.

If I remember correctly, no, he was not referring to QE. He was implying that the Fed was actually directly intervening in the mkt.

Good night. We can resume (or not) tomorrow.

__________________
Insofar as I may be heard by anything, which may or may not care what I say, I ask, if it matters, that you be forgiven for anything you may have done or failed to do which requires forgiveness...

Posted by Martinghoul on 02-04-12 12:51 AM:

Quote from denner:
Agreed, Barry is a complete shill.

How interesting it is that you practice the very thing that you accuse me of? Why such ready dismissal of people who happen to disagree with your views? Everyone of them is a "shill". How unoriginal!

The bottomline is that Martinghoul starts with the premise that all official statistics are correct and then collects data to support this worldview. I've witnessed it firsthand for several years now. Obviously, there are any number of other folks on here who have picked up on this tendency, otherwise I'd be called "paranoid" or "delusional".

Not at all. I start with the premise that official statistics are the only statistics available on a regular basis (with very few exceptions). Everything we discuss is, one way or another, based on official figures. So when I say that Biderman is being silly it's not because I am just dismissing him, but rather because his logic is trivially flawed. Moreover, the fact that official data is the only data we have means that, when you make a case against it, you have to present solid evidence. Finally, here you go again, appealing to "any number of other folks". Why?

btw, why haven't we addressed how every report is revised at a later date? Haven't we all argued about this stuff a million times already? or is today some groundbreaking new way of doing things that erases all of our valid concerns and critiques?

I am not sure what you might be referring to here. At any rate, it's time for bed. G'night.

__________________
Insofar as I may be heard by anything, which may or may not care what I say, I ask, if it matters, that you be forgiven for anything you may have done or failed to do which requires forgiveness...

Posted by macroman on 02-04-12 01:02 AM:

yes, i know, it is not easy to buy at these levels.

Posted by mgabriel01 on 02-04-12 01:34 AM:

Quote from MKTrader:

Good to see the JV Team for the Fed/TBTF banks taking time out of practice and hazing to defend the Ministry of Truth. However, the numbers have been rendered near meaningless.

http://harpers.org/archive/2008/05/0082023



Fascinating stuff
Thanks for posting this!

Posted by mgabriel01 on 02-04-12 01:36 AM:

Quote from WS_MJH:

What you have to understand is Democrats and liberals don't care about the truth: they only care about perceptions. If the liberals can convince the American electorate that it's morning in America when the economy is the worse it's been in decades, what do they care. These people backstabbed troops to win Senate seats. These are people who considered 5% unemployment under Bush to be a depression. These are people who if Komen cuts funding to Planned Parenthood, it's a start of a jihad. They're nuts. The only thing I fear is that the American electorate really is dumb and will reelect him.


I would simplify thing by replacing the terms 'Democrats' & "Liberals" with the term "Politicians"

(of whatever political stripe or ilk)

Posted by ammo on 02-04-12 02:30 AM:

this should be the ET mantra: "Let's agree to respect each others views,no matter how wrong yours might be."

Posted by trefoil on 02-04-12 05:52 PM:

Employment is a market. Just like in the stock/bond/currency/commodities markets, it has trends. If the trend is up, in order to believe something extraordinary to the downside would occur in the employment market, therefore, you’d have to believe that there was a sudden reversal in the previous trends.
Which trends were pointing up? Let’s go through them one by one (I normally post a chart when I'm making an argument like this, but this post is going to be ridiculously long as it is, so only links will get posted. The charts will be with the links, as well as the data that supports the charts):

1 - The diffusion index. There’s two of these, one for all private companies, and one for manufacturing companies only. The idea behind this index is like Wilder’s RSI: above 50 signals up, below down. The private company version has been above 50 since March 2010, meaning more private companies have been hiring than firing for nearly two years by now. The manufacturing one is more volatile, and spent the first three quarters of 2011 trending down. In Oct and Nov it went below 50. But in Dec it jumped sharply, as did the private one. That was a sign that the uptrend in this was at minimum intact. Both increased again in this report. That would be consistent with a strong jobs number, which is exactly what we got. Given that, why would you believe a crazy stat that would seem to contradict it like 1.2 million people dropping out of the labor force all of a sudden? Only if you had an agenda.

2 - At its most basic, employment is a simple function of hours worked minus productivity. Hours worked (here, for production and nonsupervisory personnel, you know, folks who actually do something) has been rising sharply. Productivity (here) has been increasing, but at a progressively slower rate. It’s a picture of employers running up against the limit on how much more they can squeeze from their existing workforce. The logical conclusion is that more hiring at an increased rate is in the pipeline. Simple, basic stuff. So why would you believe 1.2 million people would disappear from the workforce at the same time? Makes no sense, unless you have an agenda.

3 - The birth/death index. This one is beloved of conspiracy loons. I don’t know how many times I’ve read about how the BLS is just making stuff up with the plug number that falls out of their attempt to account for new businesses they don’t know about yet in the establishment survey.
The mundane reality is that this number is in there to fix a simple problem: the establishment survey, by definition, can only go to businesses the BLS knows about. So they have to have a way of accounting for the new ones they don’t know about yet. Hence the birth/death index.
The evidence, from Table 1 of this month’s explanation of the yearly revision to their benchmarks, clearly shows that in recessions this number is consistently revised down: it was revised down in each of the four years preceding this one, from 2007 through 2010, with a particularly sharp drop in 2009, obviously in response to the 2008 crisis. But in recoveries it goes up to account for the new businesses that popped up in the previous year. It went up in 2004, after the recovery in 2003 from the recession of 2001 - 02. Last year it went up, as noted, for the first time in four years. That’s consistent with a recovery, not a continuing recession. It’s another piece of strong supporting evidence that this most recent report is more likely to be reporting something real rather than a chimera.

4 - Except for the December report, which was a wash, with one previous month revised up and another down, revisions to previous months in the establishment report have been positive. (All of the previous reports, with the figures as they were reported at the time, are available here: http://www.bls.gov/schedule/archives/empsit_nr.htm ) Famously, August, which came in at zero originally, was revised the next month to show a gain of 57000 jobs. This report showed a large increase in the estimate for November, and a small one for the December number. Once again, this is consistent with growth, and once again this supports rather than contradicts the data for this month.
By the way, the net number of new jobs isn’t the only thing that’s been getting an upward revision in the employment data. The manufacturing diffusion index, for instance, was originally reported to be 56.8 for December. That was revised sharply higher this month, to 64.2 for December, and the first report for January was an even higher 69.1. November, meantime, went from 40 or so to 48.1, or from a picture of hiring weakness to one of near steady state. So what we thought was building weakness in manufacturing employment turned out to just be a small dip. How do you square that with 1.2 million people suddenly up and leaving the labor force? Obviously, you don’t.

5 - The U3 argument: the last resort of tsing tao is that the U3 number is manipulated and reports a gross distortion of the facts, or something like that. But of course U3 isn’t the only series. Even at the top of the employment situation report, the BLS reports both the household number, U3, and the establishment number. The table to all the series is easily found. What that table shows is that all of the series have been trending down. It doesn’t by any means contradict a picture of growth in employment. Is employment a lot weaker than the U3 unemployment rate? Yep. Does that mean employment isn’t growing? Nope. Which means it doesn’t support a weird statistic like 1.2 million folks suddenly deciding not to look for work anymore.

6 - The declining labor force participation rate: yes, it’s declining. Yes, that’s a big worry. The evidence is that employers are sticking to hiring folks with good job histories only, which means it’s still a buyer’s market in employment. No one I know of would contend otherwise. Until employers work through the folks with good job histories, this isn’t going to come down. bwolinsky, Grand Supercycle, formal gold, and, by the looks of it, tsing tao, are still going to have a hard time getting gainful employment. Sad but true. This still doesn’t mean that another 1.2 million folks, a number that approaches 1% of the entire labor force, are going to drop out in a single month. The overall picture for people who’ve been out of work 5 weeks or more is still very bad, but it would have to be truly horrible for something like that to happen.

The point is that all of the information in points 1 through 4, all of which points to not just growth but growth that is accelerating, was available to tsing tao when he started this thread, if he had bothered to look at the employment situation report with an analytical eye, the one that can make you actual simoleons, rather than a political one, which makes you squat.
Looking at the weight of the evidence would have told him that something must have been off in that zero hedge calculation of the folks dropping out of the labor force.
But that’s what a conspiracy monger does. Fools and their money are quickly and efficiently parted, but this place is free, so fools can continue to post crap long after they’ve lost everything. Something to remember.

Posted by xiaodre on 02-04-12 06:52 PM:

Nobody has mentioned the baby boomer retirement beginning yet? Maybe they did and I missed it.

"Now this is not the end. It is not even the beginning of the end. but it is, perhaps, the end of the beginning."

Posted by baro-san on 02-04-12 08:39 PM:

Quote from trefoil:

Employment is a market. Just like in the stock/bond/currency/commodities markets, it has trends. If the trend is up, in order to believe something extraordinary to the downside would occur in the employment market, therefore, you’d have to believe that there was a sudden reversal in the previous trends.
Which trends were pointing up? Let’s go through them one by one (I normally post a chart when I'm making an argument like this, but this post is going to be ridiculously long as it is, so only links will get posted. The charts will be with the links, as well as the data that supports the charts): ...
It's amazing, discouraging, but ultimately amusing how our biases affect our logic, which factors we exaggerate and which factors we minimize. The more we need to do these, the more verbiage and convoluted explanations. And vice versa. Way to go!

Posted by Wallet on 02-05-12 01:40 AM:

Blah, blah blah............. easy question, do you believe the actual unemployment rate is 8.3%? I don't and I doubt there's anybody else on these boards that does......... it's a farce.

Quote from trefoil:

Employment is a market. Just like in the stock/bond/currency/commodities markets, it has trends. If the trend is up, in order to believe something extraordinary to the downside would occur in the employment market, therefore, you’d have to believe that there was a sudden reversal in the previous trends.
Which trends were pointing up? Let’s go through them one by one (I normally post a chart when I'm making an argument like this, but this post is going to be ridiculously long as it is, so only links will get posted. The charts will be with the links, as well as the data that supports the charts):

1 - The diffusion index. There’s two of these, one for all private companies, and one for manufacturing companies only. The idea behind this index is like Wilder’s RSI: above 50 signals up, below down. The private company version has been above 50 since March 2010, meaning more private companies have been hiring than firing for nearly two years by now. The manufacturing one is more volatile, and spent the first three quarters of 2011 trending down. In Oct and Nov it went below 50. But in Dec it jumped sharply, as did the private one. That was a sign that the uptrend in this was at minimum intact. Both increased again in this report. That would be consistent with a strong jobs number, which is exactly what we got. Given that, why would you believe a crazy stat that would seem to contradict it like 1.2 million people dropping out of the labor force all of a sudden? Only if you had an agenda.

2 - At its most basic, employment is a simple function of hours worked minus productivity. Hours worked (here, for production and nonsupervisory personnel, you know, folks who actually do something) has been rising sharply. Productivity (here) has been increasing, but at a progressively slower rate. It’s a picture of employers running up against the limit on how much more they can squeeze from their existing workforce. The logical conclusion is that more hiring at an increased rate is in the pipeline. Simple, basic stuff. So why would you believe 1.2 million people would disappear from the workforce at the same time? Makes no sense, unless you have an agenda.

3 - The birth/death index. This one is beloved of conspiracy loons. I don’t know how many times I’ve read about how the BLS is just making stuff up with the plug number that falls out of their attempt to account for new businesses they don’t know about yet in the establishment survey.
The mundane reality is that this number is in there to fix a simple problem: the establishment survey, by definition, can only go to businesses the BLS knows about. So they have to have a way of accounting for the new ones they don’t know about yet. Hence the birth/death index.
The evidence, from Table 1 of this month’s explanation of the yearly revision to their benchmarks, clearly shows that in recessions this number is consistently revised down: it was revised down in each of the four years preceding this one, from 2007 through 2010, with a particularly sharp drop in 2009, obviously in response to the 2008 crisis. But in recoveries it goes up to account for the new businesses that popped up in the previous year. It went up in 2004, after the recovery in 2003 from the recession of 2001 - 02. Last year it went up, as noted, for the first time in four years. That’s consistent with a recovery, not a continuing recession. It’s another piece of strong supporting evidence that this most recent report is more likely to be reporting something real rather than a chimera.

4 - Except for the December report, which was a wash, with one previous month revised up and another down, revisions to previous months in the establishment report have been positive. (All of the previous reports, with the figures as they were reported at the time, are available here: http://www.bls.gov/schedule/archives/empsit_nr.htm ) Famously, August, which came in at zero originally, was revised the next month to show a gain of 57000 jobs. This report showed a large increase in the estimate for November, and a small one for the December number. Once again, this is consistent with growth, and once again this supports rather than contradicts the data for this month.
By the way, the net number of new jobs isn’t the only thing that’s been getting an upward revision in the employment data. The manufacturing diffusion index, for instance, was originally reported to be 56.8 for December. That was revised sharply higher this month, to 64.2 for December, and the first report for January was an even higher 69.1. November, meantime, went from 40 or so to 48.1, or from a picture of hiring weakness to one of near steady state. So what we thought was building weakness in manufacturing employment turned out to just be a small dip. How do you square that with 1.2 million people suddenly up and leaving the labor force? Obviously, you don’t.

5 - The U3 argument: the last resort of tsing tao is that the U3 number is manipulated and reports a gross distortion of the facts, or something like that. But of course U3 isn’t the only series. Even at the top of the employment situation report, the BLS reports both the household number, U3, and the establishment number. The table to all the series is easily found. What that table shows is that all of the series have been trending down. It doesn’t by any means contradict a picture of growth in employment. Is employment a lot weaker than the U3 unemployment rate? Yep. Does that mean employment isn’t growing? Nope. Which means it doesn’t support a weird statistic like 1.2 million folks suddenly deciding not to look for work anymore.

6 - The declining labor force participation rate: yes, it’s declining. Yes, that’s a big worry. The evidence is that employers are sticking to hiring folks with good job histories only, which means it’s still a buyer’s market in employment. No one I know of would contend otherwise. Until employers work through the folks with good job histories, this isn’t going to come down. bwolinsky, Grand Supercycle, formal gold, and, by the looks of it, tsing tao, are still going to have a hard time getting gainful employment. Sad but true. This still doesn’t mean that another 1.2 million folks, a number that approaches 1% of the entire labor force, are going to drop out in a single month. The overall picture for people who’ve been out of work 5 weeks or more is still very bad, but it would have to be truly horrible for something like that to happen.

The point is that all of the information in points 1 through 4, all of which points to not just growth but growth that is accelerating, was available to tsing tao when he started this thread, if he had bothered to look at the employment situation report with an analytical eye, the one that can make you actual simoleons, rather than a political one, which makes you squat.
Looking at the weight of the evidence would have told him that something must have been off in that zero hedge calculation of the folks dropping out of the labor force.
But that’s what a conspiracy monger does. Fools and their money are quickly and efficiently parted, but this place is free, so fools can continue to post crap long after they’ve lost everything. Something to remember.

Posted by Random.Capital on 02-05-12 02:31 AM:

Quote from Tsing Tao:

The overall issue is that the employment picture is not improving in any way, shape or form like the BLS suggests it is, and therefore the BLS data is grossly misleading at best, and an outright distortion at worst.


The employment picture in the US today is worlds better than it was in, say, 2009. There's just no question about it.

We were not hiring at all in '09 - we are hiring now - and finding it difficult to get people, but that's for another thread. Ditto for most people I personally know running companies.

Posted by trefoil on 02-05-12 03:20 PM:

Quote from Wallet:

Blah, blah blah............. easy question, do you believe the actual unemployment rate is 8.3%? I don't and I doubt there's anybody else on these boards that does......... it's a farce.


The answer to that is in the post. I'm not responsible for your lack of reading comprehension.
You're obviously more interested in being right than in making money, just like your idol tsing tao. Good luck with that.

Posted by Wallet on 02-05-12 08:41 PM:

Quote from trefoil:

The answer to that is in the post. I'm not responsible for your lack of reading comprehension.
You're obviously more interested in being right than in making money, just like your idol tsing tao. Good luck with that.


No, I read perfectly well..........

Quote from trefoil:
Is employment a lot weaker than the U3 unemployment rate? Yep. Does that mean employment isn’t growing?


But what you fail to comprehend, illustrated by your defense of the BLS reports, is that the official number itself, touted by the MSM, is an attempt to persuade the masses into believing the economy is something it's not. You can put all the spin you want on a pile of fertilizer, in reality it's a pile of horse-crap.

Has the job market gotten better, yes. But the picture itself has been diluted and misrepresented in an attempt to help prop up a failing, broken service driven economy without addressing the real issues. Even a dead cat bounces.

Until we pull off the proverbial band-aid and expose the situation for what it is, will we able able to actually fix our nation. Reporting and praising an 8.3% unemployment rate when in all actuality it's almost twice that number is just another lace in the boot kicking the can down the road.

Someone has to step up with a big set of brass ones and drop the politics to fix this mess. Regretfully, with the current trend of candidates, I don't see that happening by either party in this coming election, which imho is the last chance we have before we tip the scales past the point of saving ourselves.

Posted by denner on 02-05-12 09:48 PM:

Quote from Wallet:

No, I read perfectly well..........



But what you fail to comprehend, illustrated by your defense of the BLS reports, is that the official number itself, touted by the MSM, is an attempt to persuade the masses into believing the economy is something it's not. You can put all the spin you want on a pile of fertilizer, in reality it's a pile of horse-crap.

Has the job market gotten better, yes. But the picture itself has been diluted and misrepresented in an attempt to help prop up a failing, broken service driven economy without addressing the real issues. Even a dead cat bounces.

Until we pull off the proverbial band-aid and expose the situation for what it is, will we able able to actually fix our nation. Reporting and praising an 8.3% unemployment rate when in all actuality it's almost twice that number is just another lace in the boot kicking the can down the road.

Someone has to step up with a big set of brass ones and drop the politics to fix this mess. Regretfully, with the current trend of candidates, I don't see that happening by either party in this coming election, which imho is the last chance we have before we tip the scales past the point of saving ourselves.


+1000

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Posted by blackjack007 on 02-06-12 01:11 AM:

U6 declined to 15.1%. it was around 16% for most of 2011.

so where is the deception? looks like the labor market is improving, slowly but surely

Posted by futurecurrents on 02-06-12 01:37 AM:

Quote from blackjack007:

U6 declined to 15.1%. it was around 16% for most of 2011.

so where is the deception? looks like the labor market is improving, slowly but surely



Yes but the facts are a ploy to make it look good.

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Posted by Eight on 02-06-12 02:28 AM:

The economy can't really be considered to be going strong until housing warms up.

Posted by Wallet on 02-06-12 04:07 AM:

Quote from blackjack007:

U6 declined to 15.1%. it was around 16% for most of 2011.

so where is the deception? looks like the labor market is improving, slowly but surely


I would love to see CBS report that the total percentage of Americans without work and those who are part-time employed but would like full time employment is 15.1%. “Marginally Attached Workers” …. Such a sanitized and misleading description of someone who’s needs work and is either so discouraged they quit looking or someone who succumbed to financial pressure and took a part-time job beneath their skill level or took any part time job they could find to at least put food on the table.

Posted by Tsing Tao on 02-06-12 01:14 PM:

Probably the best take thus far on the BLS release - by Hussman. Note that he does not believe there is intent to mislead, but there is misleading nonetheless.

http://hussmanfunds.com/wmc/wmc120206.htm

To begin, it's useful to understand how the Bureau of Labor Statistics calculated the 243,000 increase in employment that it reported for January. Total non-farm employment in the U.S., before seasonal adjustments, fell by 2,689,000 jobs in January. However, because it's typical for the economy to lose a large number of jobs after the holidays, largely in retail trade, construction, and manufacturing, the BLS estimated that the "normal" seasonal decline in employment should have been 2,932,000 jobs in January. The difference between the two numbers, of course, was 243,000 jobs, which was reported as an increase in employment. The fact that the size of the seasonal adjustment was more than 12 times the number of reported jobs, and more than 30 times the "beat" in economists' expectations, should provoke at least some hesitation in taking the number at face value.

Notably, the January 2011 and 2012 seasonal adjustment factors ( seasonally adjusted payrolls divided by unadjusted payrolls) have been the two largest factors used by the BLS since the 1960's, at 1.0166 and 1.0165, respectively. This compares with a January seasonal factor of 1.0155 a decade ago, and a factor of 1.0152 as recently as 2009. Now, a range of 0.0014 in the seasonal factors for January may not seem like much, until you consider that non-seasonally adjusted payrolls are presently about 130 million jobs, so variation in the seasonal adjustment factor alone amounts to a difference of 182,000 reported jobs. I'm not suggesting there's anything nefarious going on here, it's just that part of what we're seeing here is most likely a statistical artifact of the adjustment process.

Moreover, we've had a remarkably mild winter in the U.S, particularly in January, and it's clear that this has favorably affected both construction and retail activity. Ironically, however, nothing in the seasonal adjustment actually adjusts for this purely seasonal effect. If the mild winter weather reduced the "normal" number of January layoffs by just 3-4%, that would account for the entire amount by which the January employment number "beat" economists' expectations.

Our understanding is that most economic series are seasonally adjusted using the same algorithm from the Census Bureau, and indeed, we've been able to closely replicate the labor department's adjustments to various data series using that software [Geek's note: take the option to log-transform the data]. One concern we are aware of is that some data providers such as the ISM use exceptionally short windows (such as 5 years) to estimate their adjustment factors, which appears to invite a large amount of statistical noise in these factors due to the deep and unusual weakness of the 2008-2009 period.

As a side note, because the ISM incorporated the newly released seasonal factors from the Department of Commerce, we saw some significant downward revisions in the December ISM figures that made the January figures appear stronger. For example, the January figure for new orders was 57.6, the same as the original December figure. But since the December figure was revised down to 54.8, the January report appeared to be an improvement. Compared with the original December figures, both production and employment actually dropped. The original December PMI was 53.9, inching higher to 54.1 in January, primarily due to higher inventories. The upshot is that the composite signal from Purchasing Managers Indices and regional Fed surveys has improved modestly, but the overall picture remains lukewarm.

I certainly don't want to push that argument to the point of suggesting that recent reports are irrelevant, or that they don't reflect actual improvements. There is enough conformity across multiple pieces of economic data to conclude that the positive economic performance of late is not purely statistical noise. The real issue is the extent, durability, and "leadingness" of those improvements, where we continue to be adamant that lagging data (such as the unemployment rate) should not be expected to lead. Indeed, job growth has typically been reasonably positive in the 1, 3, 6 and 12 months prior to a recession. Job growth was positive in the month prior to 8 of the past 10 recessions, and in the 3 months prior to 9 of the past 10 recessions. In other words, we shouldn't expect weak job reports to lead recessions, though the year-over-year growth rate in payrolls invariably drops below 1.5% in the early months of a downturn (a level that we're still below).

In any event, a reasonable interpretation of the January employment report is that fewer jobs were lost in January than the BLS estimated that the economy should have lost on the basis of seasonal patterns. The economy is essentially bouncing around the flatline, and the main question is how much longer we can avoid a negative shock of any kind.

Posted by Martinghoul on 02-06-12 01:21 PM:

Well, I'll be damned... Ain't we all one happy little family now?

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Posted by blackjack007 on 02-06-12 03:19 PM:

Quote from Wallet:

I would love to see CBS report that the total percentage of Americans without work and those who are part-time employed but would like full time employment is 15.1%. “Marginally Attached Workers” …. Such a sanitized and misleading description of someone who’s needs work and is either so discouraged they quit looking or someone who succumbed to financial pressure and took a part-time job beneath their skill level or took any part time job they could find to at least put food on the table.


sure I'd love for them to report U6 too. then they'd also have to report that U6 peaked at 17% in 2009, was 16% through most of 2011, and is now 15%.

in other words, they'd be reporting that we're in a recovery, to the shagrin of the perma-bears who think there's no recovery going on

Posted by dudebro on 02-07-12 04:11 AM:

IMO anyone who believes in govt numbers is either extremely naive and/or taking orders from a TBTF. especially in an election year.

Posted by Martinghoul on 02-07-12 11:43 AM:

How about this:
http://www.thereformedbroker.com/20...-shit-together/

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