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Prevailing Truths

According to official US economic data, the US Gross Domestic Product (GDP) has expanded for 22 quarters, raising real GDP 12.1% above its high prior to the 2008-09 economic contraction. Yet, US manufacturing output and US industrial production have not recovered to their pre-contraction high.  So what is driving the real GDP growth?  In my opinion, the rise in real GDP is an illusion produced by the under-measurement of inflation.

A Deeper Look into Friday's Unemployment Numbers

The headlines hit the feeds, WOW! May nonfarm payrolls -345,000, while minimizing a 9.4% national unemployment rate.

Others, not really interested in lagging indicators of a possible recession bottom, questioned Huh?

I mean, really, talk about cheerleading!   A reduction in the collosal monthly rate of job losses over the last year or so is interpreted here as a slow-down in the recession?  How so?  A slow-down in job losses, perhaps, and probably a monthly blip, but an improving recession?    How is that connection established?   I'd say there's about as much substance to that statement as Bush's remark that "We don't torture".

In Jobless rate slows, unemployment up and traders are happy:

There are so many people that have run out their unemployment benefits and have either:

  • Just stopped looking and aren't working
  • They had to take part time work

In these economic times of a prolonged recession, oops better get my words in order her, call it an economic down turn.   Did the powers to be ever really say the R word.   Did we hit enough quarters for them?

Econbrowser (one of the best blogs out there for economics!) says it all with a couple of graphs: