The American Spectator

John - TMF| 2.5.10 @ 9:28AM

The old Abbott and Costello manking change con comedy routine looks mighty tame and really funny. This isn't tame and it sure isn't funny...

Obviously the GDP calculation is a complete nonsense now. With Government spending pushing the 1.5 trillion mark, the already specious G component of the calculation is being held up by a fiction of massive proportions.

Now we have an unemployment figure that drops a tiny .3 percent, while we still LOSE jobs, and the prior numbers have been cooked by withholding the reporting of an additional 700,000 jobs over the last year. Add to that no one is even factoring in the blip in employment caused by the Christmas Season. Those layoffs start just after inventory season ends.

This means that none of the major calculations for determining the health of the economy are even remotely reliable. They are in fact false statistics that might well just be scribbled on paper and pushed to the various propaganda organs for the consumption of the masses.

Of course there isn't an damned thing that can be done about it. It would be a better than even bet that the number was fudged in response to the 4% drop in the stock market (270 points on the DOWN side for the DOW just yesterday.)

At some point someone somewhere is going to smell the massive lying.. or not.. because not enough people in power actually want to hear the truth.

Our real GNP (calculation prior to the Clinton revisionism that created the opportunity to swamp it with government spending... (how spending government money ADDS to the economy is beyond my understanding) , is probably still way negative. And the real unemployment rate is probably in the mid teens...

Which brings me back to Abbott and Costello and the 'making change' fraud.

Costello always got snookered... He knew it deep down inside so much that it frustrated him into apoplexy...but he kept going back to the con man with fresh money to lose.

:-/
The Mighty Fahvaag

Bob| 2.5.10 @ 10:36AM

Well, John, you've proven again your lack of understanding of econometrics. The GDP is up because businesses shedding jobs become more efficient. Furthermore, there is a time element involved. When demand is reduced, which is what occurs in a recession, inventories increase. Companies produce much less than demand requires to lower inventories. This means they fire more people than are needed for a steady state. At some time, (this last quarter), inventories are low and demand is higher so companies produce product. This is what GDP is all about. GDP is not a measure of the total economy, it is a measure of production. It seems you don't understand that. When production is increased, rather than companies hiring people, they use temps (because they don't need fringes that way) and overtime. Therefore, you don't have a significant impact immediately on unemployment. Over time, if demand stays higher, then companies would rather hire more workers because paying overtime can be expensive and temps are not as productive as full time workers. That's why there is a lag (between 16 months and 2 years) between the end of a recession and job growth. This is oversimplified, but I guess I had to do that for you.

The growth in the GDP will not remain this high because it is party inflated by inventory replenishment. But it is an early indicator that job growth will occur sometime in the future.

If I were you, I'd go back and learn more about economics....

By the way, the job numbers and GDP are developed from different sources and therefore have some cognitive dissidence which tends to balance over a longer period of time.

This will be a very long recovery and job growth will be slow because 70% of our economy is based on consumption rather than production. Until we produce more than we consume, we will have a continuing deficit/debt and trade balance problem.

Tish| 2.5.10 @ 9:48AM

WE'RE LOSING LESS JOBS! makes for a really inspiring election banner, doesn't it?

Alf| 2.5.10 @ 11:49AM

You can fool all of the people some of the time, and some of the people all of the time, but not all of the people all of the time.
And now we have an administration that has won the award for not being able to fool anyone any of time.

Martin| 2.5.10 @ 12:14PM

Actually we lost 940,000 jobs in January, but then "seasonally adjusted" it back to minus 20. That seaosnal adjustment is almost certainly much too big, because retail and construction will have laid off fewer in January, having been both pretty depressed in '09, thus with fewer surplus workers. The true number is probably about minus 250.

Bob| 2.5.10 @ 1:46PM

Martin, excellent point. On average during the past year, the BLS has added more job than it has subtracted. I'm not sure the number is minus 250, but it is lower than minus 20. Here's a good article on the adjustment issue:

http://www.businessinsider.com.....ata-2010-1

I do believe there needs to be seasonal adjustments to the data, but at the end of a year, they should cancel out -- or come close to canceling out.

Furthermore, we should look at total unemployment which is currently just under 20%. It should also be pointed out that most of the job losses this past year came before Obama's stimulus package took effect. I don't think the stimulus was worth the money, but that's another story.

RWinks | 2.5.10 @ 2:56PM

I have never been able to accept this "discouraged job seeker " who gives up and stops looking for work. Work must be discretionary for them. It's much easier to find work than to find a paycheck. As for people taking early Social Security, they should be able to get these figures from SSA and come close to dependable numbers.

My understanding is they have reduced the workforce to 136 million. If so, how can this be possible when there were 141 million employed three years ago? The population hasn't declined. Of course it does wonders for the stated unemployment. I'm thinking the numbers from this administration are as dependable as those from the Communist Chinese.

Bob| 2.5.10 @ 4:40PM

RWinks, there are two classes of "discouraged" workers. The smaller of the two are people who have given up looking for work. The largest group in this category is called "Others Marginally Attached to the Labor Force". These people take odd jobs, hourly jobs, under the table jobs, etc., to make ends meet. Truly discouraged workers are a fairly small part of the population -- no more than about 1.5 million. That's less than 1/2 percent of the population. It's too bad that Fox News never tells you the truth about this group of people. The average time it takes for an individual to find a job has grown from 12 weeks two years ago to about 8 months today. This is a major reason the unemployment number is so high.

This recession has reduced the workforce by about 8 million people. This is more than all of the recessions combined from Reagan to Bush2. Almost 2/3rds of this amount occurred prior to Obama being in office for 3 months (i.e., prior to any legislative action). There has been no change in the people who pump out this data in the BLS since the Bush administration, so to believe Obama had anything to do with these number is just uneducated blather.

That does not mean I agree with Obama's stimulus -- most of it is a waste. But the numbers are real. It sounds as if Fox News and the tea party people have done a number on you. If you have the capability, look directly into the numbers so you can separate fact from fiction -- something today's Republicans and tea party people can't do well.

Missy| 2.5.10 @ 8:40PM

Only fools or disingenuous liberal ideologues pretend that Fox News isn't accurate. Or maybe you're just senile, Bob.

Everyone knows that Fox blows the competition away in the trustworthiness department.