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Saying the numbers are "cooked" implies that they are manipulated, but they are not. It would not be too difficult for a private firm to collect the same data using the same methodology to see whether the they were being faked. The methodology is clearly stated and applied, the issue that you think "does not make sense" makes complete sense if you know the methodology being used.
No, it does not make sense to me that we use the filtered U-3 stat rather than the U-6, and the birth-death model fudging (whose methodology is not publicly released) is a blatant example of statistical manipulation.
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Originally Posted by user_id
The unemployment figures are as advertised. Your problem seems to be that they are mischaracterized by the media, but that is a different issue entirely. The media has been almost bipolar during this recession. Around 6 months ago they are crying "Depression 2.0", now they are talking about some sort of robust recovery. In either case is just hyperbole, but that is what gets people watching.
But it's not just the media--the government uses this spin as well. Same basic motivations...but I hate seeing UE rates in previous severe downturns compared against today's watered-down reporting to downplay the severity of today's crisis. It disingenuous at best, and fraudulent at its worst.
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Originally Posted by user_id
The month-to-month numbers are noisy, so a change from month-to-month should always be taken with a grain of salt. That is true in either direction. This is very likely just noise and the rate should continue to increase over the coming months. But initial claims have been declining for a bit now, so there are some real signs that the economy is starting to stabilize. Looking at the unemployment rate to get a sense of where the economy is going is like looking in your rear view mirror while driving...
I don't blame Obama for talking it up, he is trying to get things done and this gives in a bit of capital to do so.
Granted, but the delta from over six months of fairly ugly and steady 500K+ job losses per month and this latest release (at a little over half that) is mostly attributable to these nebulous adjustments.
As for The Chosen One, I remain focused on the fact that he's digging us a gaping economic hole and has yet to address how we get out and fill it back in.
I hardly consider the unemployment numbers "a big improvement."
I wonder how many people, unable to get a job, join the underground economy- drug dealing lite (maybe marijuana), working for cash in some way, fencing hot goods... I mean, the people who are "discouraged workers" who supposedly stop looking for jobs are eating somehow, and their families, too.
No, it does not make sense to me that we use the filtered U-3 stat rather than the U-6
Filtered? U-3 And U-6 are reporting different things, the media for whatever reason only mentions U-3. Anybody can go look up U-6 though. U-6 is really too to general though and is usually around 8~9%.
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Originally Posted by Bob from down south
and the birth-death model fudging (whose methodology is not publicly released) is a blatant example of statistical manipulation.
No, its not its just a statistic methodology. If you think its not publicly released, you have not looked very hard. The details of the methodology are available as is everything else (see link towards the bottom):
I don't get why people keep crying that the numbers are "cooked", "manipulated", etc when the details of the methodology are released and its not particularly hard for a private firm to reproduce them... If you have a beef with the theoretical basis of the numbers fine, but that is much different than them being "cooked".
Filtered? U-3 And U-6 are reporting different things, the media for whatever reason only mentions U-3. Anybody can go look up U-6 though. U-6 is really too to general though and is usually around 8~9%.
The media...and the government.
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Originally Posted by user_id
No, its not its just a statistic methodology. If you think its not publicly released, you have not looked very hard.
Well, I haven't looked very recently, anyway. But thanks for that link, I will be digging into that next week when my household visitors have left.
Quote:
Originally Posted by user_id
I don't get why people keep crying that the numbers are "cooked", "manipulated", etc when the details of the methodology are released and its not particularly hard for a private firm to reproduce them... If you have a beef with the theoretical basis of the numbers fine, but that is much different than them being "cooked".
It is, in large part, how they're used. One good example is how CPI is derived, which results in a fairly well understood understatement of inflation that is widely used as a basis for COLAs.
But what is being filtered? They talk about the U-3 numbers, with mentions here and there to other measures. Personally, I think U-4 better characterizes unemployment but the differences between the two is not that great. U-6 does not give a good characterization of unemployment, reporting it as the unemployment rate would be misleading.
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Originally Posted by Bob from down south
It is, in large part, how they're used. One good example is how CPI is derived, which results in a fairly well understood understatement of inflation that is widely used as a basis for COLAs.
Fairly well understood understatement of inflation according to who? I don't know many economists that suggest this, only tin-foil hate folks. Any measure is going to be imperfect though, there are a lot of issues with trying to determine changes in aggregate prices.
Where you see government manipulation I see theoretical difficulties in measuring matters. The government has decided to use a particular measure that is well supported by many economics and they use that. That is not manipulation...or cooking numbers.
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We only get the truth. Nothing is manipulated. All data is correct. Revised data is simply more correct. It's like perfecting perfection perfectly. Then adding 10 percent more perfection a month later.
Revised data is simply more correct. It's like perfecting perfection perfectly. Then adding 10 percent more perfection a month later.
I really don't understand why you guys think revisions in the data is some sort of evidence of government manipulation. There are good reasons for the revisions and contrary to popular belief the numbers are not always revised downward. But that has been somewhat of the trend lately.
With regards to economic data, The BEA (Bureau of Economic Analysis), BLS (Bureau of Labor Statistics), EIA, and many other agencies and entities, both public and private do an OUTSTANDING job of collecting the data which describes our massive economy.
If any manipulation or spin is being perpetuated, it is done by the media who know that most citizens do NOT read the actual reports, only the articles & TV Blurbs about the reports. As a citizen, we have the same access to these reports as institutions do, but many do not take advantage of this access.
The people who do this sort work are generally professional and more importantly, pragmatic people. Revisions are a normal part of the process. For example, the GDP report is always released in 3 stages, advanced, preliminary and final. The data collectors cannot process the data until it has been collected from the entities participating in our economy, it cannot be collected from these entities until their books have been properly closed, and the books simply take time to close.
A typical "earnings season" takes about 6 weeks for the majority of firms to report (100% reporting can take as long as a full Qtr). Once they have reported, they report additional specific information to the census such as prices, inventory balances, each for the various items and materials, both raw and finished goods etc....(you get the picture, it is very involved).
While we should always hold our government accountable and never allow blind trust to be our guide, it is simply not productive to say that our government is manipulating something that, quite frankly it has no incentive to manipulate as it must rely on the same data to make decisions regarding our economy.
i believe that there is some "pollyanna creep" going on here, and i disagree that our government has no incentive to manipulate data. they have great incentive to manipulate data!
"Pollyanna Creep"... I like that. I've learned something new today. Always a good thing.
Anyway....perhaps I am taking for granted that I actually read the reports and work with the data. Most of what I see in terms of manipulation comes in the form of "headline" numbers and commentary by the various media outlets.
I think the issue of whether or not the government manipulates it's citizens is entirely another issue and far beyond the scope of this specific topic. Perhaps we could start a new thread in a more appropriate place for that discussion. (Read Plato's Republic) the masses have always been sleeping........
back to economic pragmatism....I will say that there is one instance that I feel very strongly that the government (previous administration) forced the BEA to change the calculation of the personal savings rate so it would appear to be positive when it was not. I also believe the while currently the personal savings rate is truly positive at the moment it is still grossly overstated.
We disagree...and thats cool. If we agreed on everything then this whole forum would be a waste of time.
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I've learned something new today. Always a good thing. 
. If we agreed on everything then this whole forum would be a waste of time.
