Yes, I totally agree that the problems are 110% political. It is the failure of government "to protect and to serve" ( their sworn duty and obligation ), that keeps our workforce idle. An excellent example of government "duck'in and dodg'in" the root causes can be found in Mr. Obama's speech Saturday 2/5/11.
"It's a two-way street to prosperity, President Obama told U.S. businesses on Saturday. Government has an obligation to make sure that America is the best place on Earth to do business, but companies in turn should make their mark in this country. They should set up shop here, and hire our workers, and pay decent wages, and invest in the future of this nation, the president said". ( from "Politics Daily.com" )
Notice that Mr. Obama never mentions changing the unfair, unjust, and one-sided foreign trade agreements, nor does he mention penalizing and severely restricting job out-sourcing. He never mentions the fact that government is responsible for what we're seeing now. He plays it off like business America is the villain, and Washington has clean hands. It is the failure of government to protect the opportunities that allow Americans to earn a living wage, and for them to be self-supporting. It is the failure to legislate, pass, and enact pro-America agreements and policies, that's at the roots of what we're experiencing today in this country. Our workforce is dealing with external forces ( The Washington Brotherhood ) that they basically have no control over.
John Q. Public doesn't get to vote on the floors of Congress. As I've said many times, we would have more than enough jobs if Washington would legislate, pass, and enact, fair, equal, and balanced foreign trade agreements and policies. We could put America back to work, producing what America uses and consumes. But, as long as The Washington Brotherhood ducks and dodges the roots causes for our steady economic decline, don't expect anything other than what we're seeing now. I have never ever heard our government say that they are to blame, and accept full responsibility for unemployment, poverty, closed plants and factories, lost industries, and our steady drift towards third world status. And, we can include the fact that they accept no responsibility for job out-sourcing offshore.
ShadowStats likes U6 for a number of reasons. U6 is 60,000, more than enough for a random sample and it captures available/willing workers plus the under employed.
You're right, imho. The number of people needing jobs is the real measure. The jobs needed is of real interest but not the main point. Those available and willing to work, yet unable to find it, is a critical measure for policy reasons. If we knew just how large that population was, if that were common knowledge, i.e., the official figure, THEN we would know just how devastating it is to ship manufacturing and professional jobs overseas.
Germany seems to have unions, high numbers of skilled professionals, and relatively low unemployment - 7.4% Feb 1.
Here's their calculation. The German measure is broader than U3 since it captures "the self employed and family workers." U3 is samples payroll tax filings and misses these two important groups.
Estimation
The unemployment rate corresponds to the registered unemployed as a percentage of the civilian labour force (the dependant civilian labour force, the self-employed and family workers). OECD
So when you look at lets say, 9% unemployment for the US and 7.4% for Germany, there's a lot more than a 1.6 point difference.
My point is the BLS is dependent upon Census data and their sample size to me is just way too small and that's because "all things are derived" from that noninstitional civilian pop number. Shadow stats seems to say that's all ok and not from any statistics and large number theory I know. That said, this stuff is very complex, to maintain statistics of large numbers, i.e. government statistics.
Even on U6, I think it's low balled personally. I'm so busy trying to dig out the missing from the statistics, I haven't calculated the "real" unemployment rate.
to me, it's become meaningless in so many ways, the actual rate due to all of these problems, so I have a tendency to focus on the millions not counting the number of jobs needed, try to get a feel for the real number of people needing a job, but more absolute quantities.
i.e., using "the official" unemployment figure instead of U6 or a better alternative. It's worth a read of Shadow Stats to see his justification on methodology. His alternative is much higher than U6 but he has a rationale. I'd like to see someone do a reconciled unemployment chart that adjusts forwards and backwards for different eras, based on the official version at the time. I tried to figure out out but it's above my pay grade.
I think that the government statisticians do a fine job. They'll satisfy the requests of their departments. The US Census is particularly skilled at weighting and generating sound methodology for counting as many people as they can.
(11) How much lost tax revenue can be directly tied to unemployed members of our workforce.
(12) How much of our national debt can be directly tied to unemployment.
(13) How much lost productivity can be directly tied to unemployment.
Those are my favorites. To answer them, we'd need to use the governments U6 measure, rather than the the official measure, U3. Able workers not working defines the true impact for questions 11-13. If we use the smaller official figure, then there's no way that optimum employment, however that's defined, can do what's needed. In reality, the U6 figure is 7 points above the 9% official figure (forgetting, for a bit, the ShadowStats.com figure of 23%!). If you define "full employment" as 5%, then getting there from the official figure gets you 4 points, as opposed to the 11 points provided by the 16% U6 number. That's a huge difference in terms of cleaning up the mess we've got.
"Fed Lite was founded on Alan Greenspan’s near-religious belief that the markets always weed out inefficient players and excesses, and the Fed’s job therefore is to stay out of the way of the banks they are supposed to regulate."
A half truth. The missing part is that the rules on the books were ignored while large financial institutions had (and continue to have) an open invite into the boudoirs of our government. The market was effectively handicapped from efficiently weeding out poor performers and promoting the best because the fiat dictates of easily bought sycophants ended up choosing winners and losers all the while distorting the markets. It's typical of liberals to set aside one half of the facts when presenting an argument.
Don't get me wrong, I was ripping on Greenspan a decade before this crisis, but he was right to trust the markets over academic "know better than the markets" elitists. So after two years of Keynes unbridled, should we maybe go back to some less abstract theories like Adam Smith and Ayn Rand? At least when an individual fails, we'll know who's fault it is.
There has been enormous effort by Congress to demand a reporting of jobs directly offshore outsourced as well as created offshore, instead of the United States. They were blocked at every turn by corporate lobbyists who don't want those numbers out.
Multinationals really hide them, even in press releases, they even refuse to list their employee numbers by country.
Then, on immigration status reporting from the Census, that too is a major political block, many have tried to get that included, as it is they refuse to even use E-verify for employment...
it's really bad for foreign guest workers, for they are so massive and displace U.S. workers just as much as offshore outsourcing does....in some occupational sectors, such as I.T., they literally bias the employment statistics to fiction.
This is kind of why I'm railing on all of this, it's the raw data we need to be screaming about. Just like Eocnomic theory, if you get garbage in, you get garbage out and without accuracy, there is no way good policy is going to be prescribed to put Americans first and foremost in the jobs market or as an agenda.
Lehman Bros. were opportunistic fools who let ridiculous profits cloud their judgment, BofA got strong armed into the ML acquisition after rushing into the CW purchase, but short of a fool named Lewis at the helm, were a pretty sound institution. WAMU was a phenomenal bank, a real innovator. Wells Fargo prudent and courteous.
But JPMC and GS don't even blink to do the Devil's bidding. Pray they don't end up holding your mortgage or other debts. They make the Illuminati and Bilderbergers look like lost boyscouts in a Bohemian Grove.
Side Story, the fees and 150% increase in monthly minimums for the credit card holders had a purpose - they sold $9B of unsecured consumer debt to investors a month later and had to make the portfolio look better than it really is/was. Some call this securities fraud and if an average bloke did it, the Feds would come down hard, but when JPMC does it, Geitner and Bernanke just get out the checkbook.
A bit of self commentary that the man who won the election on his predecessor's bad public image is only leading by a hair. Perhaps if he didn't double down on the former's bad policies he'd have more of a lead. Fool me once, shame on you, fool me twice, shame on me.
Or more aptly, to quote Pete Townshend, "Meet the new boss, same as the old boss. Then I'll get on my knees and pray we don't get fooled again."
Don't assume that the GSEs aren't fudging their numbers, or at least selectively presenting them. It may actually be a fair representation of their foreclosure portfolio to mark down property prices to an average of $100,000 because they might not even fetch that in a market already saturated with 100,000s of distressed properties. Consider that over 100,000 homes are being intentionally kept out of foreclosure and off the market in certain markets like Las Vegas, Phoenix, Miami, and places in Southern California. The real loss to FMAE/FMAC is probably in the 100s of $Bs, but the value of the properties through foreclosures and lack of lending liquidity for new buyers to pick them up is really much less. Consider also, Mark-to-Market rules of 30 days, and if it takes 90 to 120 days to move an abandoned home with mold now growing on the walls and gators living in the pool, $100,000 isn't that hard to grasp.
It would be nice if the numbers were all inclusive. As it stands now, even the 9.0% unemployment number doesn't begin to tell the whole ugly story.
For Example:
(1) How many unemployed have given up looking.
(2) How many are unemployed due to illegals, job out-sourcing, and businesses relocating outside of our borders.
(3) How many are unemployed due to foreign trade agreements ( closed plants, lost industries ).
(4) How many honestly want full-time jobs, but are being forced into part-time employment.
(5) How many are entering the workforce for the first time ( high school and college grads ), but are not included in the unemployment numbers.
(6) How many employed are working for much lower wages than they were two years ago.
(7) How many employed still qualify for government assistance.
(8) How many foreclosures and bankruptcies are directly tied to unemployment.
(9) How many homeless are directly tied to unemployment.
(10) How many are without health care insurance that can be directly tied to unemployment.
(11) How much lost tax revenue can be directly tied to umemployed members of our workforce.
(12) How much of our national debt can be directly tied to unemployment.
(13) How much lost productivity can be directly tied to unemployment.
(14) How has unemployment affected the number now living in poverty.
I would guess that the answers to the above would change the bottom line concerning the real unemployment picture. As it stands now, the numbers given us monthly doesn't come close to the real unemployment figures. And certainly doesn't paint the true picture of how harsh and devastating present levels of unemployment really are.
I would claim it is not "gaming", although tracing through the politics of statistical methodology would be an interesting history post, more the issue is the baseline noninstitional civilian population methods. This is clearly screwed up when one is using the baseline number from the 2000 Census when it's 11 years later. Add to that this 60k survey, that just is way too low!
They are using data, from the 2000 census to estimate the number of households....STILL...114825428, that is 0.052% of households and that's households estimated from base 2000 Census data.
No way, even when limiting the sample to noninstitional population.
Bottom line statistics are only going to be as good as your raw baseline numbers. If those are off, everything else will be off.
Shadow statistics is interesting but they have also their own problems in methods. The minute you see opinion instead of mathematics and numbers and assumptions, baselines.....in something as massive as what's happening in a population of 307,000,000.....
question it. for example, a 1% error rate on 307 million people is 3.07 million people (which is why I find big pharma absurd when they claim "risk of death is low" from our drug, it's only 1 %....WTF, that is HUGE!)
So, 1% sounds like no big deal but when you get into large numbers, it's a skew from hell.
What we need here is better raw numbers off of which to work with. That's the bottom line, updated, monthly, real time numbers. Updated, monthly corrections on the baseline numbers upon which all is derived. One could say this for the CES as well, I mean come on, what is this statistical birth/death model of businesses and jobs and even seasonal adjustments...what the hell, we cannot get monthly real time data from every business out there operating in America in this day and age of real time texting? Why not? (Seasonal adjustments, I have not dug into but obviously applying anything that is a linear prediction model based on past historical data is going to have some errors when entering a non-linear universe)....
Anywho, raw data collection not a big burden here man, it's 2010, not 1900 and we have automatic database input technology....
Verizon and AT&T would love the additional data real time into a database...they can charge more for bandwidth. ;)
Ya know, gee wiz, just extrapolate out those w/o real time communication input devices and start using data from the modern world...
I mean how many busineses are going to have 5 employees if they do not have a smart phone, we seriously cannot extrapolate market penetration from industry from this?
But I digress...
Anywho when you dig into the methods, the sampling sizes, the error rates and the assumptions, recall how Insurance companies claim credit scores are somehow correlated to your ability to not wreck your car...
and wonder, hmmmm, now what kind of factor is that being claimed?
So, before slamming government statistics, I think first and foremost is to discover their methods, understand it plus the error rates, all taking into account trying to give statistics on a nation-state of this size.
Oh yeah, it is pure politics why the government will not collect immigration status on employment, 100% and that's just bullshit, because numbers are numbers and statistics are statistics until you get a bunch of political special interest groups not wanting certain information to come to light.
U6 is easy to understand but kept in the back room like Cinderella by the ugly ducklings in the front room. Here's an interesting source of unemployment and other stats: Shadow Government Statistics
Here's a small part of the explanation on U6 and the official version of unemployment:
Where the household survey includes farm workers, the self-employed and workers in private homes, the payroll survey does not. The payroll survey counts jobs, making no adjustment for multiple jobholders. Yet, adjusting for all differences, the BLS never has been able to reconcile the two series within one million jobs. Employment and Unemployment
Here's their latest on the various unemployment rates:
Any reasonable judgment of the value of unemployment statistics would rely on the broadest measure of those out of work. U6 is closer, although, according to this chart, it has its limitations. But the official unemployment rates are way short of those who want to work and are not and those working less than they want.
I'm reading around the Internets and I still don't think a lot of people really get this. The key is that noninstitional population graph, that is percent change on a month to month basis. So, when you see a flat line across there, it means the change is a constant, or in this case around 200,000 population growth per month in those 16 or over, not locked up or in the military or in some nursing home or hospital.
So, what you see in those deep spikes down, are the yearly adjustment, but that is an anomaly, because that deep spike down in the graph is the adjustment, but that number does not represent an adjustment between December 2010 to January 2011, it represents an adjustment in population growth going back throughout 2010 and all the way to 2006.
So, all things are derived from this number, including who is employed, so you might look at the adjustment in employment, also really an adjustment in the population growth. Those are not real people, really counted, that's extrapolated from a baseline 60k survey and it's extrapolated to the baseline noninstitional population size and the the rate of those employed versus those not with a job.
This is why the claiming there was an increase in 589,000 employed people in the population is fiction, because these numbers in the CPS survey are all derived off of that baseline noninstitional civilian population number.
I'm seeing a host of people, some extremely credible, still, not get the data methods on the CPS survey. The key is that noninsititional civilian population graph.
Posts here and here and pay key attention to that monthly percent change in the noninstitional civilian population graph. From all things derived comes from this base number, it's the superset of the unemployment statistics, i.e. the universe where all other numbers are derived from.
Many of the protesters in Egypt are out of work - long term out of work and young.
Business Week has a good article on this that seems to ring true.
Helicopter Ben's machinations to get the stock market and housing market back to where they were just before the crash have done nothing for employment. Employment is being handled by stats. We're down to 9% yet there is no public explanation as to the 750k who dropped out of the work force and therefore off the stats in the last two months. A good example of statistics being used to make a case. By the time Obama is running again unemployment will be way way down on paper yet I doubt there will be any real improvement other than on a faux statistical basis.
The economy there is seized and I understand there are runs on the banks.
Economics aside the US has supported the longest standing dictatorship in the 'free world' in order to keep peace for Israel. The population there be damned.
I think you made a typo, but it's real GDP, not Read BLS.
If their currency is pegged to the dollar, I can then see QE2 affecting Egypt more, yet, China is pegged to the dollar and they are not having these crisis. But, what was the percentage monthly increase in Egypt leading up to the protests on food? Chart it out we may get some answers as well as global food commodities and then those based on the U.S. dollar.
The Guardian is more what I'm referring to on the speculation commodities that probably was also happening in 2008. But to the Krugman argument on oil at least, demand did drop, but on Food, it's really had to claim demand dropped while more people are born every day.
There were three important points that I took from this article, which I thought was outstanding. The first is the notion of the one way markets outlined in the first section," Fed Chairman Ben Bernanke keeps repeating that a rising stock market with low volatility is a monetary objective of the central bank." That is in the tradition of TARP and the massive giveaways. Wonder how Ben got appointed to make that decision?
The point on commodities is also important: "Besides, unusual weather conditions like droughts in Russia and floods in Australia are diminishing crop yields. This is all true, but the natural disaster story only works for some commodities for a specific period in time. It doesn’t explain why so many commodities are in a speculative fury, and why the speculation began on the very day Ben Bernanke announced the Fed was considering QE2." Commodities are going up for a number of reasons AND there was a precise correlation between the QE2 surfacing and commodity speculation. This raises serious questions.
The third point concerns the relationship of Fed Policy and rising commodity prices. Numerian pointed out the lack of cognitive skills on the chairman's part when he noted:
"You could see the business reporters scratching their heads in wonder when Bernanke replied to a question about his responsibility for the riots in Egypt by saying the Fed had nothing to do with this because Egyptians buy food not in dollars, but in Egyptian pounds. Doesn’t he know that the Egyptian pound is pegged to the dollar, and commodity price increases feed directly into their economy because almost all commodities are priced in dollars?"
The Guardian talks about the skewed commodity market.
But a new theory is emerging among traders and economists. The same banks, hedge funds and financiers whose speculation on the global money markets caused the sub-prime mortgage crisis are thought to be causing food prices to yo-yo and inflate. The charge against them is that by taking advantage of the deregulation of global commodity markets they are making billions from speculating on food and causing misery around the world.
As food prices soar again to beyond 2008 levels, it becomes clear that everyone is now being affected. Food prices are now rising by up to 10% a year in Britain and Europe. What is more, says the UN, prices can be expected to rise at least 40% in the next decade.
And, this interview is interesting. Makes the same point Numerian made:
Hedge fund manager Bill Fleckenstein explains how decisions made in Washington, D.C., Wall Street and Beijing may have sparked the protests in Egypt.
Read BLS. 3.2% is right.
We may be seeing the roll out of a new tactic by The Money Party elitists. Just starve them until they cooperate. More likely, if Bernanke was not clued into the impact of food price games on entire nations, nobody else was. What some people are seeing as a sinister strategy is probably just ineptness and limited cognitive bandwidth;)
I think Texas is in much worse shape. They can't raise state income tax, as you point out. They have none. What do they do when they're backed up against the wall? The Texas deficit is $12 bil a year and the California number annualizes to about $16 bil. California's budget is twice that of Texas.
Texas Gov. Rick Perry is running for the Republican presidential nomination. He's doing everything he can to keep the Texas fiasco under wraps. This won't end well.
Robert,
Yes, I totally agree that the problems are 110% political. It is the failure of government "to protect and to serve" ( their sworn duty and obligation ), that keeps our workforce idle. An excellent example of government "duck'in and dodg'in" the root causes can be found in Mr. Obama's speech Saturday 2/5/11.
"It's a two-way street to prosperity, President Obama told U.S. businesses on Saturday. Government has an obligation to make sure that America is the best place on Earth to do business, but companies in turn should make their mark in this country. They should set up shop here, and hire our workers, and pay decent wages, and invest in the future of this nation, the president said". ( from "Politics Daily.com" )
Notice that Mr. Obama never mentions changing the unfair, unjust, and one-sided foreign trade agreements, nor does he mention penalizing and severely restricting job out-sourcing. He never mentions the fact that government is responsible for what we're seeing now. He plays it off like business America is the villain, and Washington has clean hands. It is the failure of government to protect the opportunities that allow Americans to earn a living wage, and for them to be self-supporting. It is the failure to legislate, pass, and enact pro-America agreements and policies, that's at the roots of what we're experiencing today in this country. Our workforce is dealing with external forces ( The Washington Brotherhood ) that they basically have no control over.
John Q. Public doesn't get to vote on the floors of Congress. As I've said many times, we would have more than enough jobs if Washington would legislate, pass, and enact, fair, equal, and balanced foreign trade agreements and policies. We could put America back to work, producing what America uses and consumes. But, as long as The Washington Brotherhood ducks and dodges the roots causes for our steady economic decline, don't expect anything other than what we're seeing now. I have never ever heard our government say that they are to blame, and accept full responsibility for unemployment, poverty, closed plants and factories, lost industries, and our steady drift towards third world status. And, we can include the fact that they accept no responsibility for job out-sourcing offshore.
ShadowStats likes U6 for a number of reasons. U6 is 60,000, more than enough for a random sample and it captures available/willing workers plus the under employed.
You're right, imho. The number of people needing jobs is the real measure. The jobs needed is of real interest but not the main point. Those available and willing to work, yet unable to find it, is a critical measure for policy reasons. If we knew just how large that population was, if that were common knowledge, i.e., the official figure, THEN we would know just how devastating it is to ship manufacturing and professional jobs overseas.
Germany seems to have unions, high numbers of skilled professionals, and relatively low unemployment - 7.4% Feb 1.
Here's their calculation. The German measure is broader than U3 since it captures "the self employed and family workers." U3 is samples payroll tax filings and misses these two important groups.
So when you look at lets say, 9% unemployment for the US and 7.4% for Germany, there's a lot more than a 1.6 point difference.
My point is the BLS is dependent upon Census data and their sample size to me is just way too small and that's because "all things are derived" from that noninstitional civilian pop number. Shadow stats seems to say that's all ok and not from any statistics and large number theory I know. That said, this stuff is very complex, to maintain statistics of large numbers, i.e. government statistics.
Even on U6, I think it's low balled personally. I'm so busy trying to dig out the missing from the statistics, I haven't calculated the "real" unemployment rate.
to me, it's become meaningless in so many ways, the actual rate due to all of these problems, so I have a tendency to focus on the millions not counting the number of jobs needed, try to get a feel for the real number of people needing a job, but more absolute quantities.
i.e., using "the official" unemployment figure instead of U6 or a better alternative. It's worth a read of Shadow Stats to see his justification on methodology. His alternative is much higher than U6 but he has a rationale. I'd like to see someone do a reconciled unemployment chart that adjusts forwards and backwards for different eras, based on the official version at the time. I tried to figure out out but it's above my pay grade.
I think that the government statisticians do a fine job. They'll satisfy the requests of their departments. The US Census is particularly skilled at weighting and generating sound methodology for counting as many people as they can.
Those are my favorites. To answer them, we'd need to use the governments U6 measure, rather than the the official measure, U3. Able workers not working defines the true impact for questions 11-13. If we use the smaller official figure, then there's no way that optimum employment, however that's defined, can do what's needed. In reality, the U6 figure is 7 points above the 9% official figure (forgetting, for a bit, the ShadowStats.com figure of 23%!). If you define "full employment" as 5%, then getting there from the official figure gets you 4 points, as opposed to the 11 points provided by the 16% U6 number. That's a huge difference in terms of cleaning up the mess we've got.
"Fed Lite was founded on Alan Greenspan’s near-religious belief that the markets always weed out inefficient players and excesses, and the Fed’s job therefore is to stay out of the way of the banks they are supposed to regulate."
A half truth. The missing part is that the rules on the books were ignored while large financial institutions had (and continue to have) an open invite into the boudoirs of our government. The market was effectively handicapped from efficiently weeding out poor performers and promoting the best because the fiat dictates of easily bought sycophants ended up choosing winners and losers all the while distorting the markets. It's typical of liberals to set aside one half of the facts when presenting an argument.
Don't get me wrong, I was ripping on Greenspan a decade before this crisis, but he was right to trust the markets over academic "know better than the markets" elitists. So after two years of Keynes unbridled, should we maybe go back to some less abstract theories like Adam Smith and Ayn Rand? At least when an individual fails, we'll know who's fault it is.
Shrug at your own peril.
There has been enormous effort by Congress to demand a reporting of jobs directly offshore outsourced as well as created offshore, instead of the United States. They were blocked at every turn by corporate lobbyists who don't want those numbers out.
Multinationals really hide them, even in press releases, they even refuse to list their employee numbers by country.
Then, on immigration status reporting from the Census, that too is a major political block, many have tried to get that included, as it is they refuse to even use E-verify for employment...
it's really bad for foreign guest workers, for they are so massive and displace U.S. workers just as much as offshore outsourcing does....in some occupational sectors, such as I.T., they literally bias the employment statistics to fiction.
This is kind of why I'm railing on all of this, it's the raw data we need to be screaming about. Just like Eocnomic theory, if you get garbage in, you get garbage out and without accuracy, there is no way good policy is going to be prescribed to put Americans first and foremost in the jobs market or as an agenda.
Lehman Bros. were opportunistic fools who let ridiculous profits cloud their judgment, BofA got strong armed into the ML acquisition after rushing into the CW purchase, but short of a fool named Lewis at the helm, were a pretty sound institution. WAMU was a phenomenal bank, a real innovator. Wells Fargo prudent and courteous.
But JPMC and GS don't even blink to do the Devil's bidding. Pray they don't end up holding your mortgage or other debts. They make the Illuminati and Bilderbergers look like lost boyscouts in a Bohemian Grove.
Side Story, the fees and 150% increase in monthly minimums for the credit card holders had a purpose - they sold $9B of unsecured consumer debt to investors a month later and had to make the portfolio look better than it really is/was. Some call this securities fraud and if an average bloke did it, the Feds would come down hard, but when JPMC does it, Geitner and Bernanke just get out the checkbook.
A bit of self commentary that the man who won the election on his predecessor's bad public image is only leading by a hair. Perhaps if he didn't double down on the former's bad policies he'd have more of a lead. Fool me once, shame on you, fool me twice, shame on me.
Or more aptly, to quote Pete Townshend, "Meet the new boss, same as the old boss. Then I'll get on my knees and pray we don't get fooled again."
Don't assume that the GSEs aren't fudging their numbers, or at least selectively presenting them. It may actually be a fair representation of their foreclosure portfolio to mark down property prices to an average of $100,000 because they might not even fetch that in a market already saturated with 100,000s of distressed properties. Consider that over 100,000 homes are being intentionally kept out of foreclosure and off the market in certain markets like Las Vegas, Phoenix, Miami, and places in Southern California. The real loss to FMAE/FMAC is probably in the 100s of $Bs, but the value of the properties through foreclosures and lack of lending liquidity for new buyers to pick them up is really much less. Consider also, Mark-to-Market rules of 30 days, and if it takes 90 to 120 days to move an abandoned home with mold now growing on the walls and gators living in the pool, $100,000 isn't that hard to grasp.
Michael,
It would be nice if the numbers were all inclusive. As it stands now, even the 9.0% unemployment number doesn't begin to tell the whole ugly story.
For Example:
(1) How many unemployed have given up looking.
(2) How many are unemployed due to illegals, job out-sourcing, and businesses relocating outside of our borders.
(3) How many are unemployed due to foreign trade agreements ( closed plants, lost industries ).
(4) How many honestly want full-time jobs, but are being forced into part-time employment.
(5) How many are entering the workforce for the first time ( high school and college grads ), but are not included in the unemployment numbers.
(6) How many employed are working for much lower wages than they were two years ago.
(7) How many employed still qualify for government assistance.
(8) How many foreclosures and bankruptcies are directly tied to unemployment.
(9) How many homeless are directly tied to unemployment.
(10) How many are without health care insurance that can be directly tied to unemployment.
(11) How much lost tax revenue can be directly tied to umemployed members of our workforce.
(12) How much of our national debt can be directly tied to unemployment.
(13) How much lost productivity can be directly tied to unemployment.
(14) How has unemployment affected the number now living in poverty.
I would guess that the answers to the above would change the bottom line concerning the real unemployment picture. As it stands now, the numbers given us monthly doesn't come close to the real unemployment figures. And certainly doesn't paint the true picture of how harsh and devastating present levels of unemployment really are.
I would claim it is not "gaming", although tracing through the politics of statistical methodology would be an interesting history post, more the issue is the baseline noninstitional civilian population methods. This is clearly screwed up when one is using the baseline number from the 2000 Census when it's 11 years later. Add to that this 60k survey, that just is way too low!
They are using data, from the 2000 census to estimate the number of households....STILL...114825428, that is 0.052% of households and that's households estimated from base 2000 Census data.
No way, even when limiting the sample to noninstitional population.
A good piece is the wikiedia on CPS.
Bottom line statistics are only going to be as good as your raw baseline numbers. If those are off, everything else will be off.
Shadow statistics is interesting but they have also their own problems in methods. The minute you see opinion instead of mathematics and numbers and assumptions, baselines.....in something as massive as what's happening in a population of 307,000,000.....
question it. for example, a 1% error rate on 307 million people is 3.07 million people (which is why I find big pharma absurd when they claim "risk of death is low" from our drug, it's only 1 %....WTF, that is HUGE!)
So, 1% sounds like no big deal but when you get into large numbers, it's a skew from hell.
What we need here is better raw numbers off of which to work with. That's the bottom line, updated, monthly, real time numbers. Updated, monthly corrections on the baseline numbers upon which all is derived. One could say this for the CES as well, I mean come on, what is this statistical birth/death model of businesses and jobs and even seasonal adjustments...what the hell, we cannot get monthly real time data from every business out there operating in America in this day and age of real time texting? Why not? (Seasonal adjustments, I have not dug into but obviously applying anything that is a linear prediction model based on past historical data is going to have some errors when entering a non-linear universe)....
Anywho, raw data collection not a big burden here man, it's 2010, not 1900 and we have automatic database input technology....
Verizon and AT&T would love the additional data real time into a database...they can charge more for bandwidth. ;)
Ya know, gee wiz, just extrapolate out those w/o real time communication input devices and start using data from the modern world...
I mean how many busineses are going to have 5 employees if they do not have a smart phone, we seriously cannot extrapolate market penetration from industry from this?
But I digress...
Anywho when you dig into the methods, the sampling sizes, the error rates and the assumptions, recall how Insurance companies claim credit scores are somehow correlated to your ability to not wreck your car...
and wonder, hmmmm, now what kind of factor is that being claimed?
So, before slamming government statistics, I think first and foremost is to discover their methods, understand it plus the error rates, all taking into account trying to give statistics on a nation-state of this size.
Oh yeah, it is pure politics why the government will not collect immigration status on employment, 100% and that's just bullshit, because numbers are numbers and statistics are statistics until you get a bunch of political special interest groups not wanting certain information to come to light.
U6 is easy to understand but kept in the back room like Cinderella by the ugly ducklings in the front room. Here's an interesting source of unemployment and other stats: Shadow Government Statistics
Here's a small part of the explanation on U6 and the official version of unemployment:
Where the household survey includes farm workers, the self-employed and workers in private homes, the payroll survey does not. The payroll survey counts jobs, making no adjustment for multiple jobholders. Yet, adjusting for all differences, the BLS never has been able to reconcile the two series within one million jobs. Employment and Unemployment
Here's their latest on the various unemployment rates:
Any reasonable judgment of the value of unemployment statistics would rely on the broadest measure of those out of work. U6 is closer, although, according to this chart, it has its limitations. But the official unemployment rates are way short of those who want to work and are not and those working less than they want.
I'm reading around the Internets and I still don't think a lot of people really get this. The key is that noninstitional population graph, that is percent change on a month to month basis. So, when you see a flat line across there, it means the change is a constant, or in this case around 200,000 population growth per month in those 16 or over, not locked up or in the military or in some nursing home or hospital.
So, what you see in those deep spikes down, are the yearly adjustment, but that is an anomaly, because that deep spike down in the graph is the adjustment, but that number does not represent an adjustment between December 2010 to January 2011, it represents an adjustment in population growth going back throughout 2010 and all the way to 2006.
So, all things are derived from this number, including who is employed, so you might look at the adjustment in employment, also really an adjustment in the population growth. Those are not real people, really counted, that's extrapolated from a baseline 60k survey and it's extrapolated to the baseline noninstitional population size and the the rate of those employed versus those not with a job.
This is why the claiming there was an increase in 589,000 employed people in the population is fiction, because these numbers in the CPS survey are all derived off of that baseline noninstitional civilian population number.
I'm seeing a host of people, some extremely credible, still, not get the data methods on the CPS survey. The key is that noninsititional civilian population graph.
Posts here and here and pay key attention to that monthly percent change in the noninstitional civilian population graph. From all things derived comes from this base number, it's the superset of the unemployment statistics, i.e. the universe where all other numbers are derived from.
Many of the protesters in Egypt are out of work - long term out of work and young.
Business Week has a good article on this that seems to ring true.
Helicopter Ben's machinations to get the stock market and housing market back to where they were just before the crash have done nothing for employment. Employment is being handled by stats. We're down to 9% yet there is no public explanation as to the 750k who dropped out of the work force and therefore off the stats in the last two months. A good example of statistics being used to make a case. By the time Obama is running again unemployment will be way way down on paper yet I doubt there will be any real improvement other than on a faux statistical basis.
The economy there is seized and I understand there are runs on the banks.
Economics aside the US has supported the longest standing dictatorship in the 'free world' in order to keep peace for Israel. The population there be damned.
I think you made a typo, but it's real GDP, not Read BLS.
If their currency is pegged to the dollar, I can then see QE2 affecting Egypt more, yet, China is pegged to the dollar and they are not having these crisis. But, what was the percentage monthly increase in Egypt leading up to the protests on food? Chart it out we may get some answers as well as global food commodities and then those based on the U.S. dollar.
The Guardian is more what I'm referring to on the speculation commodities that probably was also happening in 2008. But to the Krugman argument on oil at least, demand did drop, but on Food, it's really had to claim demand dropped while more people are born every day.
wish these were in the original.
There were three important points that I took from this article, which I thought was outstanding. The first is the notion of the one way markets outlined in the first section," Fed Chairman Ben Bernanke keeps repeating that a rising stock market with low volatility is a monetary objective of the central bank." That is in the tradition of TARP and the massive giveaways. Wonder how Ben got appointed to make that decision?
The point on commodities is also important: "Besides, unusual weather conditions like droughts in Russia and floods in Australia are diminishing crop yields. This is all true, but the natural disaster story only works for some commodities for a specific period in time. It doesn’t explain why so many commodities are in a speculative fury, and why the speculation began on the very day Ben Bernanke announced the Fed was considering QE2." Commodities are going up for a number of reasons AND there was a precise correlation between the QE2 surfacing and commodity speculation. This raises serious questions.
The third point concerns the relationship of Fed Policy and rising commodity prices. Numerian pointed out the lack of cognitive skills on the chairman's part when he noted:
And, this interview is interesting. Makes the same point Numerian made:
Did the economy cause unrest in the Arab world?
Hedge fund manager Bill Fleckenstein explains how decisions made in Washington, D.C., Wall Street and Beijing may have sparked the protests in Egypt.
Read BLS. 3.2% is right.
We may be seeing the roll out of a new tactic by The Money Party elitists. Just starve them until they cooperate. More likely, if Bernanke was not clued into the impact of food price games on entire nations, nobody else was. What some people are seeing as a sinister strategy is probably just ineptness and limited cognitive bandwidth;)
I think Texas is in much worse shape. They can't raise state income tax, as you point out. They have none. What do they do when they're backed up against the wall? The Texas deficit is $12 bil a year and the California number annualizes to about $16 bil. California's budget is twice that of Texas.
Texas Gov. Rick Perry is running for the Republican presidential nomination. He's doing everything he can to keep the Texas fiasco under wraps. This won't end well.
Banks Rip People off with Overdraft fees. I will never trust another bank as long as I live. I trust the firebox Idea.
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