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Jack Welch: I Was Right About That Strange Jobs Report
"Unfortunately for those who would like me to pipe down, the 7.8% unemployment figure released by the Bureau of Labor Statistics (BLS) last week is downright implausible. And that's why I made a stink about it."
"Let's get real. The unemployment data reported each month are gathered over a one-week period by census workers, by phone in 70% of the cases, and the rest through home visits. In sum, they try to contact 60,000 households, asking a list of questions and recording the responses."
"The day I became a winning trader was the day it became boring. Daily losses no longer bother me and daily wins no longer excited me. Took years of pain and busting a few accounts before finally got my mind right. I survived the darkness within and now just chillax and let my black box do the work."
The unemployment rate fell by 0.3 percentage points in September to 7.8 percent, the lowest level since January of 2009. The drop was driven by an 873,000 reported increase in employment. The employment-to-population ratio (EPOP) rose to 58.7 percent, its highest rate since May of 2010. While the establishment survey showed just 114,000 new jobs for the month, the prior two months’ numbers were revised upward by a total of 86,000. This brings the average rate of job growth over the last three months to 146,000.
The jump in employment reported in September was almost certainly a statistical fluke. It is common to have large monthly changes in the employment numbers that are not consistent with other economic data.
Saw that report the instant it was released. IIRC markets didn't move much. Struck me as curious as releasing strategic oil reserves earlier in the mandate.
California with the passage of prop 30 and failure of prop 37 and majority of the newly elected assembly controlled by the unions is pretty much done for. Also, latest poverty news of the state. "dead last".
With 15% of Americans in poverty and and 46 months or so of unemployment over 7.5% and the Eurozone
back into recession and Japan probably now in recession and a President re-elected that has given up
on the economy, letting time heal our wounds...I think the future is pretty bleak.
"...it's going to take some time for the economy to fully recover, more time than a lot of us would like..." -Obama
Record U.S. Poverty Rate Holds As Inequality Grows
At least things didn’t get worse. For half a decade, the percent of Americans living below the poverty line has increased each year, from 12.3 percent in 2006 to 15.1 percent in 2010. Today the Census Bureau released its analysis of U.S. poverty in 2011, and the official poverty rate essentially held at 15 percent, meaning that 46.2 million people live below the poverty line.
That’s still the highest level in almost two decades, but it’s good news compared with what some people expected. The Brookings Institution, for example, predicted that the rate would increase to 15.5 percent, or an additional 1.5 million people.
Although poverty levels held, there’s still bad news. Median real household income fell 1.7 percent, to $62,273, and income inequality rose in 2011. The Gini index, a common measure of inequality, rose 1.6 percent from 2010 to 2011. “This represents the first time the Gini index has shown an annual increase since 1993, the earliest year available for comparable measures of income inequality,” the Census said.
The rise in inequality seems to be driven by gains at the upper end of the income spectrum and declines in the middle class. The real income of the highest quintile of earners rose 1.6 percent, and the top 5 percent of earners saw their incomes increase 4.9 percent. At the same time, the middle-income quintiles fell between 1 percent and 1.9 percent each. When you adjust the Gini intex to take into account different types of households for each segment, the lowest quintile basically stayed the same. The rate of the extremely poor—people earning less than half of the official poverty threshold—was constant at 6.6 percent of the population.
The Washington Post points out that this poverty report may overcount the poor because it doesn’t take into account some key government supports, such as food stamps and the earned income tax credit. Calculations that include those income sources won’t be out until November—exactly when in November is a mystery, so more data either way could be politically divisive before the election.
For now, these data reiterate a central debate in the presidential election over how to safeguard the middle class. As I noted at the Democratic convention last week, politicians rarely talk about the poor, instead focusing on helping the middle class and preventing families from falling down economically. The folks in the middle, who this new data show are seeing their income shrink, will no doubt be listening.
