Unemployment Report Distortions

Interestingly Reuters seems to have reworded the article in the meantime. The paragraphs that you quoted above

U.S. employers cut 247,000 jobs in July, far less than expected and the least in any month since last August, according to a government report on Friday that provided the clearest evidence yet that the economy was turning around.

With fewer workers being laid off, the unemployment rate eased to 9.4 percent in July from 9.5 percent the prior month, the Labor Department said, the first time the jobless rate had fallen since April 2008.

 have become:
The U.S. unemployment rate fell in July for the first time in 15 months as employers cut far fewer jobs than expected, providing the clearest sign yet that the economy was turning around.

Employers shed 247,000 jobs in July, the Labor Department said Friday, the least in any one month since last August, taking the unemployment rate to 9.4 percent, down from 9.5 percent in June.

I am not a native English speaker but to me while the meaning is exactly the same, the faulty logic is less visible.

why cant you people believe 637,000 waited til the last day to fine a job!!@#$^&%#@@

Ed:  This was a repost of the entire article.  I saw no need for this and removed it to save bandwidth.

Perhaps a bit of punctuation could clarify the acronym . . . . May I suggest:  BS, L? 

 Here is a chart that says it all.

I find the actions of the FOMO more ominous.  To fund this reflation the bonds must be issued.  To the extent that they do not sell they must be monetized.  If the rate of monetization steadily increases because real demand steadily decreases then the game is over.  To me however the tell tale sign is this.  The primary dealers must know what is going on as they are the distribution conduit for the Fed money.  So when this last quarter these primary dealers dolled out more in bonuses than they earned in corporate profits that tellls me something.  They know their busisness model is not viiable past the point where the Fed stops funneling money into the system so they are taking their cash now while the taking is good.     

Unemployment figures have never revealed the full picture as a measurement of our economy, so it is bad enough that the figures are being distorted for political gain.  
The current economic situation is far worse than we realize:  There are few statistics being published on two groups that never drew unemployment when businesses close, and those are the self-employed and the "contract employees" who do not qualify for unemployment and have no access to services in the traditional format.  It would be quite interesting to see the figures for "unemployment" combined with the aforementioned two groups - I believe the numbers would be staggering and set historical records.


If I recall, the B-D model uses 12 month lagging data. But that is an aside, what you say I totally agree with.

Very good point.  I believe I should change my comment from "staggering" to "mind-boggling" considering the 12-month lagging data you mention!  It is a fearsome situation, so how do we change it?  I am new to the site, so give me some time to absorb it all…

I’d like to open with a discussion of Friday’s Forex moves - and the notion that the $ experienced a major turn here based on the perceived and bogus improvement in employment. Dr Martenson has clarified the inherent distortions well, but it does beg the question that aren’t the smart boys in the room just well versed in this black art?
It’s a little difficult to understand how this data could possibly set off a major $ rally, as presented by all mainstream media yesterday and today.

Does anybody see legs in this rally - or was this more of the same kind of short covering that has affected prices of AIG and some other issuers lately?

Also perplexing is why gold and gold shares have been among the weakest performers recently. This is totally counterintuitive based on the increasingly obvious machinations of the FED to suppress interest rates and the fiscal and monetary situation slipping out of control, obvious now for anyone - particularly the primary dealers- to see?

After all, they are the smart boys in the room and the ones with the clout to move markets. 

Comments would be appreciated


 Real numbers can’t be conned for long.

 Don’t see the edit button. What I meant to say is:
Real numbers can’t be conned for long, Enron (The Smartest Guys in the Room) were proof of that. A good movie by the way.

DaveG, yes you’re right…big floor traders are not making moves solely based on fake government data.  They like the fact that the masses might make moves based on "fundamental" news like that because they can use it against them, but they don’t rely on one piece of data like this for their mega moves.  They’re making moves based on strategic risk preferences within the debt collapse we’re in. Since March 9 they have led a correction from extreme risk-aversion to risk-acceptance…that’s the only basis for the equity market rally while the media blathers about looking for "fundamental" reasons.  Traders know that the next phase of the collapse is coming soon, i.e. the pendulum is going to swing back to risk-aversion, and they’re largely the ones that will be doing the initial swinging.  In a massive debt collapse, micro analysis really doesn’t matter…all markets are going to move together based on liquidity flows toward and away from risk.  The traders know also that rather than being a domestic trigger, eastern Europe is likely to be the "fundamental" trigger for the next collapse.  So the overall shift back to risk-aversion is going to cause yet another global flight into dollars, but the media will blame eastern Europe for the rise in the dollar…traders like that.  

 That unemployment number being ‘better than expected’ gave me xx.000 euros profit in 10 minutes with rahter a small amount used, it goes straight to buying gold and other necessities. If the numbers were then expected probably the same.
These numbers, fuzzy as they are, are a great way to add volatility and volume to the stock market. Something traders really like. Until the biggest manipulators like GS are stopped this will go on for some time. A crash of the market is on its way as many people are lured back to the market afraid to miss out on the profits. Ideal time for the big boys to start selling and let the small people bite the dust.

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