Economic Clowns Spin Jobs But Cannot Hide
Failure's Reek
The initial jobs report came in for January. The non-farm payrolls
increased by 113,000 and the official unemployment rate dropped to 6.6%.
While those who haven't been on the inside of the Beltway recently were
ringing alarm bells, those inside were shrugging the numbers off...again.
A former Federal Reserve economist, Julia Coronado, was quoted as saying,
"The jobs report is a disappointment but it's not anything like
disastrous."
Where do they find these clowns? Barnum and Bailey's Circus is missing a
gold mine.
A quick recap of some facts where America is at with this latest jobs
report. Fact 1, America needs to add around 200,000 jobs each month to stay even
with the population growth. Fact 2, in December and January combined the economy
added just 188,000 jobs. Fact 3, in that same time frame the official
unemployment rate went from 7% to 6.6%. Fact 1 combined with Fact 2 does not
give you Fact 3...unless you are cooking the books in a way that would make Al
Capone or Enron jealous.
Former Chief of the Fed, Alan Greenspan weighed in on the labor report by
saying, "The U.S. labor market has been thrown out of whack by a skills
imbalance. There are a considerable number of people who are on the disabled
list, just like the number of people who can no longer find work. This is a very
distorted labor market."
That's the best the insiders can come up with for an explanation, a
distorted labor market?
Not entirely, Greenspan took it a step farther and, as usual his numbers
don't add up here either. "You have to look at the GDP and ask where's the
shortfall? What the data is showing is almost all of the shortfall is in durable
goods (items that last more than 20 years.)"
I'll give him that point because of the construction drop but here's
another way of looking at the economic non-recovery. In 2006 America hit $16.3
trillion in GDP. We had just under 300 million people per a Census Bureau
estimate that year. That is an average of $54,333 per person. In 2013 the GDP
tippled towards the 16 trillion mark once again through inflation but we had 320
million people per a Census Bureau estimate. That figures out to almost exactly
$50,000 per person. Where's the recovery?
We are behind where we were, per capita, eight years ago even without
figuring inflation! Sorry, Beltway Bozos, that is data you cannot hide from. You
can distort it, as Greenspan did, but you cannot cover up the stench.
Greenspan went on to one more item, "Companies lack confidence about the
future. The stock market is still undervalued for the long-term. They will have
to renew their confidence the economy is recovering."
Greenspan is drinking the Kool-Aid here. The market's rise is not due to
"being undervalued", instead the market, per any normal application of economic
fundamentals, is vastly overvalued. Whether you are looking for a capital gain
or for dividends, the lack of performance by this bull market defies its'
existence.
What was particularly shocking in the January jobs report was how far the
"expert analysts" missed the ball. The consensus was the economy would add about
175,000 jobs in January and that December's report would be significantly
revised higher. The December revision was 1,000 more while January's initial
report had the professionals wearing a large 36% miss factor. The jobs report
followed by three days the disheartening factory report from the Philadelphia
Fed which showed a drop to an eight-month low in activity.
These are serious storm clouds on the economic horizon considering America
has not yet hit the March 1 date for the next installation of
Obamacare provisions where an additional 7 million people were to have insurance
plans in place. To have the nation's leading political economists try to emulate
their boss and shrug these numbers off is a travesty.
The official unemployment number fell only because another large group of
people dropped into the oblivion of not "actively seeking a job." But this is
not reported as bad news. The workforce participation rate drops to a 35-year
low (back when Jimmy Carter's inflation rate was running at 17%) and that is not
reported.
The highlight was the unemployment rate dropped to 6.6%. Pretty soon the
government will count anyone not actively receiving unemployment compensation or
working as 'not in the workforce.' Then America's unemployment rate will be
0.0%.
This is a massive government shell game right now where the political
interests are running down the road, hoping the crash doesn't happen before
Obama is out of office. They are trying to delay the effects of two terms until
after he is gone for no other purpose than to have it become the someone else's
problem.
The most detached President in history can then lead his merry band
of clowns off the stage. It would be appropriate if they do so to the music of
"Send in the Clowns" because we've lived with them for years.
"I have sworn on the altar of God eternal hostility
to every form of tyranny over the mind of man."--Thomas
Jefferson
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