The term discontinuity is probably unfamiliar to the casual observer of economic accounts, but they are quite regular features in almost all the statistical data series. It goes with the territory, as statistical estimates themselves vary in depth and “quality.” For example, when the Census Bureau updates its population estimates to incorporate fuller or “better” samples or sample sizes, it [...]
The official unemployment rate has been moving downward almost exclusively as the labor force shrinks so dramatically in proportion to the population. That wasn’t the intent for the design of the statistic, but the state of economic commentary being what it is has left most observers to draw their own conclusions (I think most unbiased people understand what is going [...]
QE’s hope is that in the course of redistribution any spurt of temporary activity caused by such monetary deck shuffling will lead to follow-on activity (the cult of aggregate demand). As we see in the US, the redistribution appears to have had the reverse effect, including effects on global trade. In Japan, the other nation so fully devoted to QE, [...]
Going back to the snow debunking from earlier today, the primary impediment to wider economic expansion outside of bifurcation and artificial monetary channels is income and employment. Mainstream commentary aside, employment has been mostly atrocious for some time. The clear divergence between the Establishment Survey and the Household Survey, both from the BLS, establishes that break in October 2012 – [...]
The most important segments of the GDP report are, to me, final sales and gross private domestic investment (outside of inventory). Those are the proxies for end user demand in the economy (final sales to domestic purchasers), level of production (final sales of domestic product) and business tendency toward investment (or disinvestment). Overall GDP can grow at 3+% in the [...]
The main features of conventional wisdom as it pertains to economic measurement always related to two factors: GDP and employment. As I detailed earlier this week, such a regime developed simply because there was a correlation that seemed to be quite durable. GDP and employment, for the most part, moved largely in concert and making economic judgment rather simple and [...]
I have been a pretty consistent and often times harsh critic of the mainstream economic accounts we generally use to gauge the economic system. Any of those critiques are not necessarily directed toward the manner of construction of those statistics, only in how we view them once they are synthesized. That is to say there is nothing really wrong about [...]
When I got in the investment business 23 years ago, a very wise man told me that my job as an advisor was to find clouds when everyone else saw nothing but sunshine and to find the rays of hope when everyone else was hunkered under an umbrella. Markets and economies move in cycles and while it is impossible to [...]
In early 2010, economists had been delivered a twin bill of economic accounts that seemed to confirm recovery. GDP for the fourth quarter of 2009 had been initially estimated at close to 6% and employment appeared to finally be bottoming out. The pace of GDP expansion even led to talk about that infamous V-shaped recovery of the plucking model. It [...]
It’s not often you hear contrary viewpoints from mainstream commentators that survive the gauntlet of translations and redirection. That has been particularly true in the past week or so since both the GDP report and jobs report were so reassuring. That these encouraging developments do not extend to any deeper meaning is left out, and has thus been the focus [...]
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