BLS to Revise Number of Lost Jobs

Because the economy is collapsing – but government (and major financial institutions) haven’t fully figured this out yet – from Seeking Alpha, quoting Comstock Funds:

The Bureau of Labor Statistics (BLS) recently announced that they will be making downward benchmark revisions to past monthly nonfarm employment data that casts doubt on the validity of the recent figures as well. As we will explain, it is highly likely that substantially more jobs are now being lost than is currently reported.

The BLS makes annual revisions to the previously announced payroll reports to account for job increases or decreases that were not picked up in the initial data. The main reason for the differences in the preliminary and final reports is the difficulty in getting numbers from the many small and medium sized business and accounting for new startups and firms going out of business. To make an educated guess at the data that they are missing, the BLS uses something called the ARIMA time series model (commonly called the birth/death model) to estimate employment changes resulting from business births and deaths that are not accounted for by other methods. The model is based on the actual births and deaths over the five prior years.

As you can imagine, when the prior five years were a period of economic expansion, the application of these numbers to a period of recession can result in a substantial overestimation of job changes, and that is evidently what happened recently…

…In the current instance the BLS announced that preliminary tabulations indicated they would have to reduce the estimate of total nonfarm employment by about 824,000 for the year ended March 31, 2009. On average, therefore, employment for the period was overstated by about 68,000 per month. Interestingly enough, the birth/death adjustment had added about 717,000 jobs during the same period. So it’s apparent that the benchmark revision will more than wipe out the entire amount added by the model.

What does this mean for the period following March 31, 2009, which will not be revised until next October? For the six months since March 31st the birth/death adjustment has added 815,000 jobs, an average of 135,000 per month. Since small and medium sized firms are suffering from severe credit restrictions, they are much more likely to have reduced employment significantly rather to have added that many jobs. That means current monthly job losses may be running as much as 135,000 higher than is currently being reported…

Mish’s has been on this, from what I can tell, for years now…but the most recent noting of the flawed “birth/death” figure is right here. Essentially, what the BLS has been doing is pretending that we’re creating jobs – and thus when BLS says we shed 263,000 jobs in September of 2009, its a bogus number. That number would be correct if we were creating 135,000 jobs per month…but as we’re probably creating only a tiny fraction of that number, we have to figure that the real number of jobs lost in September might have exceeded 350,000. This might help you make sense of the fact that after weeks of BLS saying 400,000 or so new claims for unemployment were made, that the total jobs lost for the month was 200,000 or so.

This recession is nothing of the kind – it is a Depression. The government and the banks (and stock marketeers playing the “greater fool” theory of investment) are talking up recovery…and, of course, the numbers we’re about to get will almost certainly show that the recession “ended” in the late Spring. But it simply isn’t true – and won’t be true until we start creating wealth. Our first step in this will have to be getting liberals – from Obama on down – to understand that money isn’t wealth. You can spread money around all you like, but until people actually get to work making, mining and growing things, no wealth is being created. Once you realize what wealth is, then the policies needed immediately present themselves – cut taxes, cut regulations, provide credit and then get the heck out of the way.

But I don’t hold out much hope for a swift education of our liberal friends – and so, the next crash is almost inevitable. And it will be quite a mess…the continuing financial crisis on steroids as all that government fiat money light an economic conflagration not seen in 75 years, if ever.

UPDATE: Wages plunge.

Phrase of the Day

Its not money we need, but wealth:

…If … we measure a thing or commodity by something which is not its end, we do not give its absolute value, but only its relative value. Yet how many modern minds, when asked the value of a commodity, think in terms of the end of the commodity? If we are asked, ‘ What is the value of a hundred-weight of wheat?’ we naturally say ‘Eight, ten, or twelve shillings.’ We do not say ‘A hundredweight of wheat will support a man’s life for six months.’ In other words, by expressing a hundredweight in terms of currency we gave, not its value, but only its money-value. No wonder that minds accustomed to the atmosphere of currency find themselves in an intellectual money-muddle…

…How great the plight must sooner or later befall a people that has lost the art of giving things their real value, and has entrusted the commonweal to the muddled judgment of men who are experts only in money value. – Fr. Vincent McNabb

Domine! Salve nos; perimus

$620,000,000.00 for 397 Instead of 19,500

That is how much it cost to make that many jobs instead larger claimed number:

Michigan received $3.7 billion is stimulus money, of which $620 million was to be used to “create and save” jobs, while the remainder will be used by Granholm to backfill the budget deficit that she has created with her overspending so that she doesn’t have to make any substantial cuts before she leaves office. When she walks away, she will have lost more than 1,000,000 jobs in a state with a population of only 10 million. A few days ago, Granholm claimed that stimulus money “created or saved” 19,500 jobs (Enron accounting: Stimulus saved or created 19,500 jobs in Michigan). Turns out, the number is an utter fabrication, as I suspected when I wrote that prior post. Fact is, that $620 million “created or saved” 397 jobs.

That works out to about $1.5 million per job – oh, and Granholm isn’t the only governor using Spendulus money to fill in the State budget…lots of States are doing it just as we here at Blogs for Victory predicted.

You poor, sad, little liberals – you thought that Obama was going to usher in a grand, new era. Well, he’s not – because he’s the product of a corrupt, Democrat machine as are all the other leading Democrats. People who rise by corruption don’t tend to be straight arrows. You’d be better off with the likes of Jerry Brown and Dennis Kucinich – you’d hardly ever win, but at least you’d have some reasonably honest (and highly entertaining) leaders. Right now, you’ve got political barnacles who are mostly interested in feathering their nests and dodging the hard choices until they are out of office, or at least in their second term.

The money is going to favored groups and individuals, for the most part, and that which isn’t being spread around as payola is being used to hide fiscal malfeasance. I hope that you eventually wake up from your stupor, but I don’t have much hope of it.

The DOW and Government Pick-Pockets

Just in case anyone out there is breaking out the champagne over DOW 10,000:

…While in absolute terms the Dow may cross whatever the Fed thinks is a necessary and sufficient mark before QE begins to taper off (Dow crosses 10k just as Treasury purchases expire), the truth is that over the past 10 years (the first time the DJIA was at 10,000) the dollar has lost 25% of its value. Therefore, we present the Dow over the last decade indexed for the DXY, which has dropped from 100 to about 75. On a real basis (not nominal) the Dow at 10,000 ten years ago is equivalent to 7,537 today! In other words, not only have we had a lost decade for all those who focus on the absolute flatness of the DJIA, but it is also a decade where the US Consumer has lost 25% of purchasing power from the perspective of stocks!…

Fiat money – ie, money not backed by a hard asset, such as gold – is the perfect invention of Big Government. Used to be, when the government wanted to debase the currency, they had to call in all the coins and re-mint them with a lower gold content…and you could dodge this by holding on to the old coins. But with fiat money, its so much easier – all that had to happen is the Fed saying, “hey, presto!” and there are several trillion more fiat dollars in circulation…which means, of course, that the dollars you foolishly saved (in a bank, in a stock fund, under your mattress: doesn’t matter) have now become worth less than they were before.

This doesn’t hurt government – in fact, it helps government: it allow government to pay us back with bad money for the good money we lent it via bond purchases. It also doesn’t tend to hurt the very rich, as they either own hard assets (which will naturally climb in value as the dollar goes down), or they get returns equal to or greater than the amount Uncle Sam is stealing from us. Since we started down the road to fiat money – in 1913, with the creation of the Fed – our dollar has lost 99% of its value; Obama and the Fed are going for broke…trying to see if they can make our money absolutely worthless, and then they’ll pay the bondholders (this is why China is rather ticked off at us, by the way).

An MSMer Does Right by Rush

Sheer class:

On Apologizing To Rush

No, it didn’t make me throw up in my mouth. I’m a little sick that I got it wrong, as I should be. But not sick that I have to apologize to Rush. The thing is this: I don’t think that you guys expect me to get it write right 100 percent of the time. I think you expect me to try very hard to be accurate, and immediately acknowledge when I’ve failed to do so. I don’t fear losing readers because I was wrong. I very much fear losing readers because they think I’m not being honest.

You can’t say fairer than that – all of us, I think, have sometimes rushed too quickly to seize upon something we think hurts the other side; it shouldn’t happen, but we’re human, and so it does…but what matters what you do when you make a mistake, and you know it. Ta-Nehisi shows us all how its done.

This Article Horrified Me

And I hesitated before bringing it up – the inhumanity of our age, as expressed by abortion, is graphically on display. Don’t read this unless you’ve got a strong stomach.

Ouch. Only 43% Would Vote To Reelect Obama

Which means that that 43% aren’t paying attention to what a disaster he is.

In what may be the ultimate job rating, 43 percent of voters say that they would vote to re-elect President Obama if the 2012 election were held today, down from 52 percent six months ago, from April 22-23, 2009.

Obama’s job approval rating comes in at 49 percent this week. That’s down just one percentage point from late September, but it marks a new low approval for the president — and the first time the Fox News poll has measured his approval below 50 percent.

Moreover, the number of Americans saying they would vote to re-elect President Obama has dropped. If the election were held today the poll finds more voters say they would back someone else in the 2012 election than would back the president.

Have at it… It’s nice to see people realizing the guy is incompetent and in way over his head.

But in all seriousness, can we have the election again in November so we can fix the Great Mistake of ’08?

Global Warming Update

The doom and gloom headline goes:

Arctic Sea Ice Extent is Third Lowest on Record

Wow! Third lowest! Incredible! But, wait…

Arctic sea ice reached its minimum extent around September 12… According to scientists affiliated with the National Snow and Ice Data Center (NSIDC), sea ice coverage dropped to 5.10 million square kilometers (1.97 million square miles) at its minimum. The ice cover was 970,000 square kilometers (370,000 square miles) greater than the record low of 2007 and 580,000 square kilometers (220,000 square miles) greater than 2008…

…The four lowest ice extents on record have occurred between 2005 and 2009, with the record minimum reached during a dramatic drop in ice cover in 2007 that was exacerbated by unusual polar winds.

So, the ice cover hit nadir in 2007 and has increased substantially in 2008 and 2009 – and the worst year was partially caused by unusual winds. Anyone sense a trend here? Now, if you go in to the story you’ll see that the claim is that ice cover is 34% lower than it was 30 years ago…but, then again, we were in a warming trend during that time and it does make a bit of sense that ice would recede…meanwhile, for the past decade we’ve been in a cooling trend, and now we see the ice sheet expanding, again. Anyone want to bet me that in 15 years or so it will be back where it was 30 years ago?

Meanwhile, the zealots are still at it, asserting that the Arctic will be ice-free in summer within 20 years(the article has a picture of people sun bathing in the Arctic…so that you liberals out there can understand)…nice of them to put it out that far, long after a presumptive passing of “cap and trade” and other screwball enviro-fascist bills…

Deflation Watch

From Bloomberg:

The cost of living in the U.S. rose at a slower pace in September, showing inflation will not be a threat as the economy emerges from the worst recession since the Great Depression.

The 0.2 percent gain in the consumer-price index followed a 0.4 percent increase in August, as forecast, figures from the Labor Department showed today in Washington. Excluding food and energy costs, the so-called core index also climbed 0.2 percent, more than anticipated and pushed up by health care and a rebound in auto prices. Rents dropped for the first time in 17 years. (emphasis added)

First time in 17 years. For you liberals out there, I’ll say that slowly: first – time – in – 17 – years.

Still have faith in Obamunism?

HAT TIP: Mish’s

Scorched Earth: Dems to Exercise 'Nuclear Option' on Obamacare!

Connie Hair on Human Events reports:

The bill certified for “reconciliation” is the Ways & Means version of H.R. 3200 that was passed out of committee before the August break, and before it was read aloud at town hall meetings across the country and blasted by voters across the country.

It contains all of the horrors previously exposed: federal funding of abortion, coverage for illegal aliens, comparative effectiveness, healthcare rationing, deep cuts to Medicare. Everything the American people overwhelmingly reject.

No amendments were allowed at the hearing and no debate. Rangel told Rep. Dave Camp (R-Mich.), the ranking Republican on the committee, that he would not have preferred to do it this way, but leadership — i.e., Speaker Pelosi — forced his hand.

Damn the torpedoes, full speed ahead. By so obviously thwarting the will of a vast majority of the American people, It would appear to that the democrats are quite willing to relegate themselves into a permanent minority, if it will advance America’s downward spiral into the bowels of their great socialist experiment.

They want it that bad.

The ends, after all, justify the means.

(via KOSMOSNET)