Given it is payroll Friday, it has to be a chart related to the futility of focusing on the headline number. There is any number of ways with which to accomplish this, but it serves well to highlight the relationship already presented in my view of this specific view of the payroll report. Economists often claim that the participation problem [...]
The BLS released yet another perfect payroll report for July. It hit on all the major themes, putting further distance to the shocking May number. All the right people have been reassured by all the right parts. U.S. employment rose at a solid clip in July and wages rebounded after a surprise stall in the prior month, signs of an [...]
For decades the slander against Herbert Hoover went unchallenged. He was branded a “do nothing” in the 1932 campaign, a charge which looks sillier the more time passes. The proper slander of Hoover is that he was Roosevelt before FDR was, only in miniature. From this view we can appreciate the intentional change in perspective; Hoover’s interventions failed to stop [...]
There was more bad news for the FOMC over the past few days beside the once again near-zero GDP estimate. If the labor market were truly growing as is claimed, we should be finding “inflation” in a broad set of different economic views. From the standard inflation calculations to various estimates for wages or income, by now it should be [...]
Going only from the conventional interpretation of the optimistic 242,000 in payroll gains Friday, it is still remarkable how more than one-fifth of those purported job creations in February were due to activity in retail trade alone. The monthly variation estimate for the retail sector (not including wholesale or transportation of goods) was an especially robust +55k even though the [...]
Having established the farcical nature of wage interpretations on the shortest time scale, a wider contextual framework leads in the same direction of doubt. The point of any interest rate hike for monetary policymakers is to head off “inflation” before it gets out of hand; the economy “overheating.” Having undertaken sufficient (it is assumed) stimulus to surpass whatever hysteresis calculations, [...]
The February payroll estimate for the Establishment Survey was 242,000 with upward revisions to December and January, so we are told the labor market is surging once more. Last month when the Establishment Survey suggested “only” 151,000 (before revisions) it was taken as disappointing even though there is statistically no difference between 151k and 242k (a 90% confidence interval leaves [...]
When Janet Yellen testified to Congress last week, she was as usual careful with her words. Alan Greenspan once called it “mumbling with incoherence” but there is very little left to rambling in Yellen’s predicament. Where Greenspan was once the “maestro” and Bernanke the “hero” Yellen is stuck holding the bag, and I think she knows it. In truth, there [...]
As China, Japan is the definition of insanity. GDP fell 1.4% in Q4 2015, marking the fifth contraction out of the past nine quarters and yet the word “stimulus” remains attached to QQE, the Bank of Japan and Abenomics in general. At this point, how much more time and sample size is necessary before calling it a failure? In about [...]
The January retail sales report demonstrates perfectly the nature of this whole recovery, but especially the last year or so when everything holding to the primary narrative boils down to the unemployment rate – a statistic that is more and more determined by peculiar assumptions and calculations. The advance release from the Census Bureau had enough positive vigor to provide [...]
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