In Case You Missed It

| October 6, 2012

We now have 4 straight years with  a Federal deficit in excess of $1 trillion.  The estimated deficit for FY2012, which ended on 30 September 2012, is $1.1 trillion.  Official figures are expected to be released in mid-October.

The Federal government is now borrowing roughly 31 cents of each dollar it spends.  That’s nearly 1 out of every 3 dollars.

Category: Economy

Comments (28)

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  1. NHSparky says:

    I’m still trying to figure how adding 114k jobs can drop the unemployment rate when it takes an addition of nearly 200k a month just to keep up with population growth.

  2. Yat Yas 1833 says:

    Sparky, it’s obammy math! I’m a news/political junkie and every news outlet I follow, Fox News, CNN, MSNBC, etc , even other liberals, are calling these numbers fishy! After having his a$$ handed to him by Gov. Romney, what else can he do? He has no record to run on, he has no nuthin’! He’s a proven liar so why not keep on lying?!

  3. Ex-PH2 says:

    I’m more interested in the how, why and wherefore involved in revising the July jobs added figures in October, two days after a debate in which Bo was clearly not up to the game. If I could figure out a way to do it, I’d get my inquisitive little paws on the books. As a long-time taxpayer, I’d like to see an audit trail run on the BLS.

  4. Hondo says:

    What it means, NHSparky, is that way more people dropped out of the labor market.

    The “official” unemployment rate (U3) is calculated as number working divided by number in the labor market. The labor market is defined as those employed plus those “actively looking for work”. If more quit looking than are added to the labor market, the unemployment rate will decline – even if the number of jobs stays exactly the same. And part-time work is counted.

    In fact, it’s even possible for the number of jobs to go down and the unemployment rate to go down at the same time. Here’s an example: one month, you have 900,000 jobs and 100,000 people out of work and actively looking. That gives you an unemployment rate of 10% – one minus 900,000 employed divided by the sum of 900,000 employed plus 100,000 actively looking, or a labor force of 1,000,000.

    Now, assume you lose 10,000 jobs, and have 50,000 new entrants into the labor market – but 70,000 people quit actively looking for work. You now have 890,000 working – and a labor force of 980,000 (the 890,000 working plus the 50,000 new entrants plus the 30,000 who are still actively looking for work plus the 10,000 who just lost their job). That works out to an unemployment rate of 1 – (890,000/980,000) = 9.18%. You lost jobs, but unemployment went down more than 0.8%!

    U3 unemployment is at best only a very crude measure of how well the economy is doing. It’s easy to misinterpret – and manipulate. And it doesn’t tend to peak until a recovery is well underway.

    A much better measure of how the economy is doing is the labor force participation rate (the number of persons of working age either working or looking for work). And that number is at a 30-year low – which means that yes, Virginia, the economy is indeed still in the toilet.

  5. Bubblehead Ray says:

    Figures lie and liars figure. The first time unemployment dips below 8% in the past 4 years occurs a month before the election and 2 days after the Emperor proved he had no clothes. As Dana Carvy would say “Isn’t that CONVENIENT!”

  6. 2-17 AirCav says:

    Please do not question THE ONE. If he says the jobless rate fell below 8%, then it fell below 8%. If he says that an unseen film triggered US embassy attacks and killings, then it did just that. If he says that he is constitutionally permitted to choose which laws he will enforce, then he is. If he says that the country needs more spending, more borrowing, and higher taxes to recover from the protracted economic crisis, then that’s what it needs. If he says that universal healthcare is not a tax, then it’s not a tax. If he says, the 15 people who will decide whether medical treatment will be authorized or not do not constitute a death panel, then they don’t. In other words, if he says “FORWARD” just shut up, close ranks, and get behind him. He is THE ONE.

  7. Yat Yas 1833 says:

    Hondo, you’re too damn smart for your own good!? (kidding) You gotta remember a lot us are just old “dog face GIs” who ain’t so smart to understand this sh1t!?! 🙂

  8. Hondo says:

    C’mon, Yat Yas 1833. No one regularly posting here is too dumb to “get it”, not even our regular “liberal brethren” like Sippy the Pinhead and Joe the Rockclimbing Hero. Ditto for most of the US population – if they want to actually take the time to listen to facts and think a bit.

    But many in the US are indeed woefully ignorant, and perhaps even more are apathetic. And some, like Sippy and Joe, are in full-blown denial.

  9. Old Tanker says:

    This goes with Hondo’s excellent breakdown of the U1 figures. I was listening to an Economics professor say that the reduction in unemployment from it’s high of about 10% has been due almost ENTIRELY to people just dropping out of the work force and not looking anymore. IF those people are counted he figures the true unemployment rate to be about 9.8%. And that is a pretty conservative number.

  10. Ex-PH2 says:

    @OT, I think it’s closer to at least 13%.

    My issue is that on Friday, Secy. Solis said that the jobs numbers are based partly on payroll (which is the only valid statistic), partly on self-employed stats which is based on IRS tax receipts, and partly on household phone surveys.

    The SE tax stats and the payroll stats are acceptable, because those are the numbers that are originally reported before revisions, but the household phone call surveys? Not so much. Anecdotal evidence for something like this is as valid as anecdotal evidence that the UFOs seen over Cleveland on Thursday night were really UFO space aliens, and not just a bunch of skydivers practising night jumps with flares. And I don’t believe either of those stories, so you can see how I will take the household phone survey report with more than a grain of salt.

    And I come back to my previous question: why were jobs added numbers for July and August revised in October two days after a major debate?
    Choose one:
    A: – makes Bo look good
    B: – makes Bo look good
    C: – makes Dear Leader look good
    D: – because the Dem PTB really do think people are that stupid and will suck up fudged statistics like dried-up sponges and vote for Bo.
    E – fill in the blank

  11. 2-17 AirCav says:

    Numbers render me dizzy but do not affect my memory. Obama said that the stimulus package would drop the unemployment rate to around 5.5% by about now. So, the stimulus package was passed and what–a trillion dollars later?– he and his idiot minions are crowing that the rate is slightly below 8%.

    Romney should take off the 16 oz. gloves and pummel the Clown-in-Chief with bare knuckles.

  12. teddy996 says:

    @11- Romney doesn’t punch the clown, Cav. He’s Mormon. They’re against that kind of stuff.

  13. NHSparky says:

    Hondo, yeah, I should have put the /sarc tag after it. That’s how the numbers haven’t gotten much, much worse (think 11-12 percent range) considering the workforce participation rate is the lowest it’s been since the late days of Carter/early Reagan administration. Couple that with the fact that they did the only thing they could to reduce the workforce size they used to “calculate” the unemployment rate…

    Time to get some sleep before hitting the job for another six nights. I’ve already seen my federal withholding for this pay period. Holy shit.

  14. Common Sense says:

    In addition to the excellent descriptions above, the numbers include 91,000 government jobs, private sector jobs actually went down by 5,000.

    Also, 600,000 part-time jobs were miraculously discovered. Pundits suspect that the Dept of Labor suddenly started counting them differently.

    In any case, the whole thing stinks and even Dems are questioning the numbers.

  15. Ex-PH2 says:

    I posted this also in Fiscal Follies-Unemployment. It explains a lot about this accounting trick, using part-time workers to fill in the bare spots.

    Morici to Moneynews: Unemployment Fell on Part-Time Workers, Not Real Improvement
    Friday, 05 Oct 2012 11:24 AM
    By Forrest Jones and Steve Cordasco

    Read more: Morici: Unemployment Fell on Part-Time Workers, Not Real Improvement
    The U.S. employment rate dropped to 7.8 percent in September from 8.1 percent in August, thanks largely to gains in part-time workers and not due to noted fundamental improvements in the labor market, said Peter Morici, a professor at the Robert H. Smith School of Business at the University of Maryland.

    The economy added a net 114,000 jobs, the Bureau of Labor Statistics reported, adding its household survey reported that total employment rose by 873,000 in September, much of which was due to an increase in part-time work. Some 582,000 Americans took part-time positions because of slack business conditions or those jobs were the only work they could find.

    The number of unemployed Americans stands at 12.1 million, the fewest since January 2009, though keep the champagne on ice for now.

    “We’re basically creating jobs at the pace that the population grows. We’re not really getting a real decline in unemployment,” he said.

    “If we go back to when the recovery began, the unemployment rate was 10 percent. Today’s numbers, if the adult participation was where it was then, we’d be at 9.7-9.8 percent unemployment.”

    The number caught many market observers off guard, surprising many who were expecting the unemployment rate to remain steady or even rise to 8.2 percent.

    Former General Electric boss Jack Welch said on his Twitter page that the numbers appeared manipulated.

    “Unbelievable jobs numbers..these Chicago guys will do anything..can’t debate so change numbers,” Welch said on his Twitter page, referring to President Barack Obama’s performance in the first presidential debate earlier this week.

    While the Obama administration did not likely cook the numbers, which is very hard to do, it shouldn’t rush out and claim victory over a soft jobs market and a sluggish economy.

    “The economy’s in neutral,” Morici said.

    “I would give the president the grade of C if he had just taken office and, frankly, a failing grade at this point in time given this very poor performance.”

    Meanwhile, expect the government to take the numbers and claim the economy is healthier than it really is.

    “People’s real incomes and wealth have been falling now for about five years and they certainly want some relief. The president is going to try to tell everybody, ‘Look, now that you’ve put an ‘I’m for Work’ sign in your front window, everything’s just fine. The unemployment rate is falling,'” Morici said.

    “I can hear [Vice President Joe] Biden now. No one paints false figures into facts better than he does. They will be out there manipulating the truth and the economy’s just not getting better and people know about it.”

  16. UpNorth says:

    Well, the Regime did change the rules on work to welfare, so maybe now they count those who’re thinking about getting a job as employed?
    Ex, Hilda Solis is from La Raza, she’s not exactly a paragon of virtue when it comes to advancing an agenda.
    Unemployment drops but the U-6 numbers remain unchanged?

  17. Ex-PH2 says:

    UpNorth, in view of the timing and her saying on CNBC yesterday (Friday) that a portion of the numbers came from household phone surveys, it becomes suspect under any circumstances. I’m waiting for the expose (ekspohsay)book to emerge after Bo leaves office. 🙂

    And, anyway, did anyone you know get a phone call from the Bureau of Labor Statistics? ‘Cause she sure didn’t call me.

  18. MCPO SPEW ALERT says:

    And on the eighth day, he made Obama. Obama would part the oceans and open all borders. He would bring peace to all Christians, Jews, Muslims, Pagans and union workers. He would unite the world not by leadership by his presence alone. He would connect the world by issuing free cell phones. And he would create jobs … yes … the CREATOR of Jobs.

  19. Ex-PH2 says:

    Oh, I forgot about Obamaphones! That’s where the household phone survey results originate. Thanks for reminding me, MCPO S.A.

  20. MCPO SPEW ALERT says:

    @ EX-PH2 … I am here to help.

  21. UpNorth says:

    Beat me to it. I do believe the Obamaphones are pre-programmed, and the DoL just puts them down as “working”.
    Nope, Ex, I’ve never talked to anyone who’s been polled on their employment status.
    Santelli at CNBC said that Obama would get the unemployment numbers below 8% before November, and he did. Miracles will never cease.

  22. MCPO Bama Foan says:

    J Giles Band Remix – Very Good

    Obama Phone Original

  23. MCPO Bama Foan says:

    One mo Obama foan remix (headache material):

  24. Hondo says:

    Speaking of J. Geils – I wonder when the DNC is going to adopt “Give It to Me” as their new theme song . . . .

  25. NHSparky says:

    And then after they get their “free” shit, the moochers will use, “Piss on the Wall” as their theme.

  26. Richard says:

    I read somewhere else today (Pajamas Media, maybe?) that the number you really want to look at is U6, which indicates that the real percentage of people either unemployed or underemployed is at around 15%.

  27. Hondo says:

    Richard: I haven’t checked it lately, but that sounds correct. And U6 is indeed the sum of unemployment and underemployment. For the past 3 years, it’s been consistency 6-8% higher than the “official” unemployment rate (U1). So 15% for U6 should be in the ballpark.

    However, if I recall correctly U6 also doesn’t count those who’ve become discouraged and quit actively looking for work or who’ve gone back to school due to no other good option but who would prefer to work. An even better indicator is the labor participation rate (fraction of persons in the potential labor force who are actually working) – which does count those individuals.

    It’s currently at a 30+ year low.