Words for the wise indeed.
But given the bovine excrement that the US Bureau of Labor Statistics has just released, maybe we need to reword it to "You can't believe anything you hear."
The US Bureau of Labor Statistics has put out its January 2012 employment data, which has been met with cheering by the markets. But even cursory inspection beyond the headline figures raises serious questions as to what this data shows, how it was arrived at and the overall issue of its credibility.
Firstly, the headline figure of 8.3% unemployment - don't believe it. Look at the fact that around 1.2 million individuals dropped out of the labor force. Huh? Suddenly, 1.2 million Americans died, emigrated or just weren't interested in getting a job anymore - yeah, after 12 months, you suddenly 'give up'. A year ago, 99 million Americans were not in jobs and the unemployment rate was 9.1%. Now, 100 million Americans are out of work...and the unemployment rate is 8.3%.
Sure.
'Seasonal adjustment' - indeed any adjustment - is one of the dark arts of economics, and whilst it has a legitimate place in giving some smoothness to figures, it is something that can seriously mislead if it is abused. And in this case, the abuse is blatant.
But whilst I can poke more holes in this data, I'd like to take you to have a look at one of the real end effects, possibly the most serious one...
The Scary Story behind the latest US Employment numbers...
Once again, my friends at Zero Hedge cut through the crap and show you real numbers that tell you the real story.
Look at the raw data. See the raw deal.
What this data shows is that the US may be 'creating' more jobs...but it is collecting less tax. Why? I can give you a personal example of a close friend who used to be a senior engineer in aerospace, earning over USD 200,000 base salary...up until November 2008, when he got laid off. He did not land another full time job until August of 2011...as a regional manager for a restaurant chain, earning a base of barely over half of what he used to get. And this type of story is not uncommon. High paying jobs replaced by lower paying ones, or the same jobs lost on contract terms that should normally be full time.
America in recovery? Don't believe it.
