“After expectations of a rebound in initial claims from 367K last week (naturally revised higher
to 369K), to 370K (with the lowest of all sellside expectations at 355K), the past week
mysteriously, yet so very unsurprisingly in the aftermath of the fudged BLS unemployment
number, saw claims tumble to a number that is so ridiculous not even CNBC’s Steve Liesman
bothered defending it, or 339K. Ironically, not even the Labor Department is defending it: it
said that ‘one large state didn't report some quarterly figures.”Great, but what was reported
was a headline grabbing number that is just stunning for reelection purposes. This was the
lowest number since 2008. The only point to [publishing this misinformation]? For 2-3 bulletin
talking points at the Vice Presidential debate tonight. Everything else is now noise.
“It is also sad that the U.S.“economy” has devolved to such trivial data fudging on a week by
week basis, which makes even the Chinese Department of Truth appear amateurish by
comparison. Needless to say, Not Seasonally Adjusted initial claims jumped by 26K to 327K
in the past week, but who’s counting?
“Finally, what is the reason for ongoing QEternity if the employment situation is now back to
normal? Finally, in completely ignored news, because who needs global trade when you have
toner cartridge, and generally [red] ink, the U.S. trade deficit in August rose by 4.1 percent to
$44.2 billion, on expectations of a deterioration to $44.0 billion. Then again nobody talks about
the U.S. trade deficit during presidential debates so all good here.
“Jobless Claims beat by the most since May 2009 and is the lowest since January 2008 - the new
Finally, there’s this from Conn Carroll in an editorial in the Washington Examiner:
“Ever since the economy became the focus of the 2012 presidential election, interest in the Labor
Department’s monthly jobsreport has never been higher. This election season, on the first
Friday of every month, political observers across the country are frantically hitting the refresh
button on their browsers to get the latest jobs numbers. And the last report, released on October
the 5th, was a doozy.
“It reported that while U.S. employers said they created just 114,000 jobs in September,
873,000 Americans claimed to have gotten new jobs in that same month. Only three other jobs
reports in the history of the Labor Department had a larger gap between the employer and
household survey. Here are some other facts about last Friday’s historic jobs report.
1.The economy is not getting stronger
“’The right message is that on Friday, we saw great economic news,’ Brian Moran, the
chairman of the Virginia Democratic Party, told The New York Times. ‘Things are moving in
the right direction.’
“Only if you think declining job growth is“the right direction” can you interpret the recent job
report as “great economic news.” The reality is that according to employer survey, the economy
has been creating just 106k jobs a month over the last six months. That’s compared to the 194k
job a month clip from the six months before and it is just barely above the 100k jobs a month
the Atlanta Federal Reserve says we need to keep up with population growth.
“But what about the 873,000 Americans who said they got new jobs last month? Doesn’t that
prove the economy is getting better? No. No, it doesn’t. That 873,000 number comes from the
Current Population Survey, which is conducted by the Census Bureau for the Labor
Department’s Bureau of Labor and Statistics. The CPS is famously volatile and far less reliable
an indicator of economic conditions than the employer survey (called the
Current Employment Statistics survey).
“But even considering the usually unstable nature of the CPS, this September’s CPS report is
particularly unreflective of reality. Wells Fargo called the September household survey ‘a black
swan outlier’ and noted that the 873,000 job gain ‘was more than four times the size of the
average change over the past 12 months.’ Gallup‘s Chief Economist Dennis Jacobe said the
CPS 873,000 job gain ‘seems to lack face-validity.’
“Hours after the September jobs report was released, Washington Post blogger Ezra Klein said
the household survey’s 873,000 job growth was backed up by the ‘internals’ since 582,000
Americans said they got part time jobs.
economic reasons’ (e.g., inability to find full time work) did grow by 582,000.
“But while ‘part time for non-economic reasons’ (e.g., illness, family obligations) did fall 260k,
Table A9 of the household survey showed that the total number of part time workers actually
fell 26k. But 582,000 – 260,000 does not equal -26,000. So what gives? Turns out
the household survey derives the two numbers from two entirely separate questions.
“When deriving the “part time for economic reasons” number, BLS asks respondents how many
hours they worked in a specific week. If they worked anywhere in between 1 and 35 hours in
that week, then they are deemed “part time.”This question produced the 582,000 spike in
September. In a separate question, BLS asks respondents if they usually work full or part time.
This is where the-26,000 total decline in part time work came from.
“So if a respondent normally works full time as a contractor, but for the specific week BLS is
studying, that person worked less than 35 hours because he couldn’t find enough work, that
person would be counted as both full time for one part of the survey and “part time for
economic reasons” for another part of the survey.
3. Government employment is growing
"You won’t hear President Obama tout this fact on the campaign trail, but one of the strongest
sectors of job growth in the September household survey was from government jobs. Of the
838,000 full time jobs the household survey claims were added in September, almost
one-quarter, 187,000, came from the government. Even the employer survey showed some
government job growth, albeit a twentieth the size (just 10,000).”
If this is what the experts think, and if the likes of Steve Forbes and Jack Welch (former CEO of
General Electric) are telling us that the numbers are phony, we need to let our friends know before
tonight’s debate, for certainly these numbers were pumped up for the express purpose of Joe Biden using
them to sound victory for Obama’s economic policies. It’s the ammunition he needs.
During World War II, German bombs were often made by slave labor.The slaves were not above
sabotaging the bombs (so that they didn’t explode on impact) in order to thwart their evil masters. If
Paul Ryan can defuse this October Surprise bomb and expose the numbers contained within as a dud,
he’ll stand a better chance of winning the debate.
Undoubtedly, being the economics expert that he is, Ryan knows the truth about the numbers. The
Americans (who bother) watching tonight may not. Those who rely on news accounts of the debate the
next day certainly will not. Forbes Magazine, Jack Welch, Rush Limbaugh, Mr. Carroll, and young
Mr. Durden here and others have been indispensable in providing us the facts, which we might not
otherwise have. Our task is to further dispense that information to our family and friends for tonight’s vice
Many pundits have declared that the numbers were too good to be true, historically unlikely, and their
publication just before a major vice presidential debate suspect. Now we have the facts and the
The math has been done and the real numbers don’t lie. Time for us to start spreading the truth,