December 18, 2014

Cuomo to Upstate New York, Especially Its Blue Collar Workers: Drop Dead

Filed under: Economy,Environment,Taxes & Government — Tom @ 6:56 pm

The news:

New York Gov. Cuomo moves to ban fracking

New York officials on Wednesday moved forward with an effort to ban fracking across the state, citing excessive environmental and health concerns.

… A ban would end the state’s current six-month moratorium on fracking.

The process of fracking involves shooting a mix of pressurized water, sand and chemicals to split rock formations to release natural gas and so-called tight oil.

The widely used, deep-drilling process has resulted in a surge in domestic-energy production and has created millions of new jobs.

However, state and local governments are pushing for bans over the health and environmental concerns, including the potential for earthquakes and the contamination of natural water supplies.

New York sits atop the Marcellus shale formation, which stretches 600 miles along the Appalachian Basin and is rich in natural gas deposits.

Fracking supporters immediately expressed opposition to the state’s plan.

“Today’s action by Governor Cuomo shows that New York families, teachers, roads and good-paying jobs have lost out to political gamesmanship,” said Karen Moreau, of the New York Petroleum Council, an arm of the American Petroleum Institute, which represents some of the world’s biggest energy companies.

American Thinker’s Thomas Lifson:

Despite intense efforts to discover actual negative health effects from fracking, none has been found. Oh, there’s that movie Gasland showing flames being lighted from a water faucet, but that was exposed as a fraud, since the natural gas in the water pipes predated fracking. But Cuomo is demanding proof of absolute safety, an almost impossible standard that is applied to almost nothing.

But it’s a standard which, if universally applied, would prevent all future progress.

Fox’s Shepard Smith Hopes Cuba Relations Thaw Doesn’t ‘Ruin the Place’

Those who rail at Fox News for allegedly being a haven of unbridled, uninterrupted conservatism usually and conveniently fail to remember that Shepard Smith is there.

Smith’s take yesterday on the potential pitfalls of a thaw in U.S.-Cuba relations, particularly on the commercial front, was nothing short of astonishing. His primary fear, expressed in an interview with Gerri Willis of the Fox Business Network, is that the new arrangements might “ruin the place.” It would be “the last thing they need” to see “Taco Bell and Lowes” locations there. Smith also posed as a market analyst, wondering if the Dow was up 300 points because of President Obama’s related announcement. Video (HT Mediaite and PJ Media’s Ed Driscoll) and a transcript follow the jump:

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Initial Unemployment Claims (121814): 289K SA; Raw Claims 21% Lower Than Same Week Last Year

Filed under: Economy,Taxes & Government — Tom @ 8:45 am

Note: I can’t seem to get to the DOL’s report at the moment. Zero Hedge has reported that seasonally adjusted claims dropped to 289,000 last week.

From the Department of Labor:

Waiting …

Bloomberg only predicted that today’s number would be “litle changed from last week.”

The seasonal adjustment factors for this week (113.3) and the same week a year ago (112.6) were basically the same.

UPDATE: I’ve backed into last week’s raw claims, which were roughly 327,500, or about 21% below the same week last year.

UPDATE 2, 9:10 a.m.: I’m through waiting. On to other things …

December 14, 2014

AP Reporter Thinks We’re Thrilled to Be ‘Finally Getting One Over’ on Gas Stations

Here’s a small window into a journalist’s mindset.

In a report on how lower gas prices are affecting the companies operating retail gas stations, Associated Press reporter John Fahey revealed his apparent believes that there are millions of us walking around, perhaps including him, obsessed with getting back at gas station owners for charging us so much at fill-up time for years:

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December 12, 2014

More BLS BS

There’s far less than meets the eye in November’s jobs report.

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This column went up at PJ Media and was teased here at BizzyBlog Wednesday morning.

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UPDATE, Dec. 12: Longtime commenter dscott wants to make sure I remind everybody of the following item I left on the cutting room floor (and maybe shouldn’t have) —

[F]ull-time employment is STILL 2.4 million below where it was in November 2007 (seasonally adjusted and not seasonally adjusted) — seven long years ago. But yet, wer’re supposed to believe that Obama administration policies, and particularly Obamacare, have nothing to do with this incredibly depressing statistic.

_________________________________________

On Saturday at the Associated Press, aka the Administration’s Press, reporter Christopher Rugaber described the economy’s pickup of 321,000 payroll jobs in November as “booming.”

Not so fast, pal.

Even if you accept that November’s seasonally adjusted result fairly reflects the underlying reality — and it doesn’t, which will be shown shortly — it will only be “booming” once we see such a figure repeated for at least five more months. On a workforce-adjusted basis, the analogous post-recession period during Ronald Reagan’s presidency in the 1980s had a streak of 19 out of 20 months with an equal or better performance than just seen in November while averaging 323,000 monthly job additions over 65 months. Monthly job growth during the Obama administration’s 65-month faux recovery has averaged only 140,000.

Additionally, the seasonal adjustment process at the Bureau of Labor Statistics — an attempt to normalize results to smooth out normal and supposedly predictable fluctuations occurring throughout the year — generated an artificially high November result, as illustrated in the following comparison:

NSAandSAjobAddsSepNov2008to2014

As seen in the red boxes, BLS currently estimates that the economy really added 497,000 jobs in November. That’s 26,000 fewer than were added in November 2013. Yet somehow, after seasonal adjustment, November 2014 came in 47,000 jobs higher than the same month last year. A more reasonable seasonally adjusted result in Friday’s report would have been in the neighborhood of 250,000 — far from awful, but definitely not “booming.”

By contrast, as seen in the green boxes, October’s seasonally adjusted result understated that month’s strength. Before adjusting for workforce size, the 1.051 million in estimated job additions that month is the best result since the government began monthly recordkeeping in 1939, and is 107,000 jobs greater than November 2013. October is the month which should have seen a seasonally adjusted result well above 300,000; instead, it was barely better than October 2013.

What’s going on here?

As former BLS head Keith Hall told John Crudele last year, as paraphrased by the New York Post reporter:

All parts of Washington’s data-collecting machine adjust to smooth out the bumps caused by the seasons of the year. But the recession that started five years ago was so severe and the recovery so anemic that the seasonal adjustments have been thrown off.

Gee, I’ve been saying that for over five years, including this statement from mid-2011:

In normal times, it’s usually acceptable for data users to stick with seasonally adjusted (SA) information while avoiding the adventure of delving into and analyzing the raw, not seasonally adjusted stuff. But these are not normal times. … In abnormal times such as these, you cannot be sure that the SA data adequately reflects what’s happening in the raw information.

To be clear, I’m not alleging that the BLS is deliberately engaging in deception in its Establishment Survey of employers — yet. But the agency knows how misleading its official adjusted data have often been, and has done next to nothing to alert the public to the problem. Meanwhile, reporters in the business press, most of whom know better, still treat the adjusted numbers as gospel while barely acknowledging the raw numbers’ existence.

Thus, the public has every reason to believe that November was a great month in the job market, while October was lukewarm. The reality is exactly the opposite — which should be leading people to wonder if economic conditions might once again be deteriorating.

One likely reason why the press isn’t interested in touching the BLS’s detailed machinations is the strong likelihood that there have been and continue to be problems with data integrity and manipulation in the Household Survey. That’s the Census Bureau-managed operation which collects the information used to calculate the nation’s unemployment rate and the civilian population’s degree of engagement.

The Post’s Crudele, virtually the only reporter in the land pointing out the fundamental problems in the government’s jobs reports, noted last week that “whistleblowers in five of the six Census regions in the US have alleged data were being falsified on a regular basis.” The falsification is occurring because workers who can’t meet the Department of Labor’s aggressive and likely unrealistic survey completion requirements are submitting fake surveys.

A likely far bigger problem with the Household Survey, based on discussions I’ve had with an informant out in the trenches, is that BLS, under current far-left agenda-driven director Erica Groshen, appears to have stealthily raised the bar for what it takes to be considered actively looking for work. If you aren’t considered an active job seeker, you’re not considered unemployed, or even part of the civilian labor force. As a result, there’s reason to believe that BLS is deliberately undercounting the number of unemployed by several million, thereby significantly understating the unemployment rate.

Hall believes that the unemployment rate’s understatement may be as high as three percentage points. Imagine how different everyone’s outlook would be if he is right, and today’s unemployment rate, consistently defined and calculated, is really over 8.5 percent. My Census informant tells me that almost every experienced worker in the field believes that the government’s current reported unemployment rate of 5.8 percent is really much higher.

Other indicators point to the existence of a genuinely higher unemployment rate.

Take food stamps. Even given the program’s aggressive recruitment efforts and overly lax qualification requirements, it’s hard to square the idea that the unemployment rate dropped from 9 percent to below 6 percent in the 36 months ending in September, while food stamp enrollment remained between 46 million and 48 million during that entire time.

Now let’s look at income. The Census Bureau alums at Sentier Research estimate that real median household income is still 5 percent below where it was before the Great Recession officially began, and that it has barely budged in the past year. An economy which really has an unemployment rate of 5.8 percent would be showing far more signs of upward pressure on wages. Those questioning the unemployment rate surely should include administration apologists who believe that “full employment” has somehow become 5.5 percent instead of the 4.0-4.5 percent commonly accepted a decade ago.

Sadly, the BLS’s credibility is quickly becoming yet another casualty of the President’s self-described “most transparent administration” ever. We’re all poorer because of it — figuratively and literally.

December 11, 2014

I’m Calling BS on November’s Retail Sales …

Filed under: Economy,Taxes & Government — Tom @ 9:37 pm

… until someone explains this:

RetailSalesNov2014andNov2013

Start with October (green boxes), where 2014 unadjusted sales were 4.85% greater than October 2013, and seasonally adjusted sales were up by 4.51%. Those percentages are comparable, and within reason.

Now look at November, where 2014 unadjusted sales were 3.36% greater than November 2013, while seasonally adjusted sales were up by 5.13%.  Those percentages are NOT comparable, and do not seem to be within reason.

It looks to me like the seasonally adjusted numbers are overstated.

Initial Unemployment Claims (121114): 294K SA; Raw Claims at 388K

Filed under: Economy,Taxes & Government — Tom @ 8:13 am

Predictions:

  • Business Insider — carried no predictions
  • Bloomberg — expects “unchanged” from last week’s 297,000

Seasonal adjustment factors:

  • Week ended Dec. 6, 2014 — 132.0
  • Week ended Dec. 7, 2013 — 129.3

Raw claims:

  • Week ended Nov. 29, 2014 — 294,185
  • Week ended Dec. 7, 2013 — 463,413

I would hope that there’s a pretty big seasonally adjusted dip, given how high the seasonal adjustment divisor is. Update: To match last week, raw claims would have to come in a 392,000, which would be a horrible result in light of what we’ve seen during the past several months.

We’ll see here at 8:30. I may not comment on the result until 10.

10:30 a.m.: HERE IT IS (permanent link):

SEASONALLY ADJUSTED DATA

In the week ending December 6, the advance figure for seasonally adjusted initial claims was 294,000, a decrease of 3,000 from the previous week’s unrevised level of 297,000. The 4-week moving average was 299,250, an increase of 250 from the previous week’s unrevised average of 299,000.

UNADJUSTED DATA

The advance number of actual initial claims under state programs, unadjusted, totaled 388,258 in the week ending December 6, an increase of 93,834 (or 31.9 percent) from the previous week. The seasonal factors had expected an increase of 97,745 (or 33.2 percent) from the previous week. There were 463,413 initial claims in the comparable week in 2013.

That was way too close for comfort. I don’t care what the adjusted result is, 388K in raw claims is potentially troubling — emphasis on “potentially.” It’s the highest number of claims in any single week since January.

December 10, 2014

Latest PJ Media Column (‘There’s Far Less Than Meets the Eye in November’s Jobs Report’) Is Up

It’s here.

It will go up here at BizzyBlog on Friday morning (link won’t work until then) under the title “More BLS BS.”

December 8, 2014

Thin Gruel: AP Hypes How ‘Job Market Hits a Turning Point’

Friday’s Employment Situation Summary contained one strong element: In November, the economy added 321,000 seasonally adjusted payroll jobs. That’s not insignificant, but that news, especially in the report’s full context, certainly didn’t justify the level of elation seen in much of the press.

Predictably, the Associated Press found a specious reason to characterize the government’s report as signifying a “turning point.” Get a load of why: “For the first time since the Great Recession ended 5-1/2 years ago, America’s unemployed are now as likely to be hired as to stop looking for a job.” In other words, for the first time in 65 months, what people would expect to be a normal situation finally occurred.

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December 7, 2014

Unreal: UFCW Demands Walmart Pay $15 Per Hour, While Thousands of Its Members Earn Far Less

Filed under: Economy,Taxes & Government — Tom @ 9:36 pm

Just before Thanksgiving, Our Walmart and the United Food and Commerical Workers went into high gear in their effort to draw attention to their advocacy of $15-per-hour minimum wage at the nation’s largest retailer. Just after the holiday, I pointed to a column by the Manhattan Institute’s Diana Furchtgott-Roth, who quickly discovered that many Kroger employees represented by the UFCW earn far less.

It didn’t take much additional research to demonstrate that any fair and balanced reporting on the union’s Our Walmart activities should note that “thousands of UFCW members, and perhaps even a majority, earn less, and often far less, than the $15 per hour Our Walmart is advocating.”

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December 5, 2014

November 2014 Employment Situation Summary (120514)

Filed under: Economy,Taxes & Government — Tom @ 7:15 am

Note: Competing obligaions will prevent me from noting or commenting on today’s results until late afternoon or early evening.

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UPDATE: 321,000 jobs were added and the unemployment rate is still at 5.8 percent — But Household Survey employment only increased by 14,000. Both not seasonally adjusted benchmarks noted below were missed (497K actual vs. 600K benchmark in nonfarm, and 380K vs. 450K in the private sector.

To the extent that the administration got the shaft in October’s seasonal adjustments in the Establishment Survey, that completely reversed itself in November.

The Household Survey told us that seasonally adjusted full-time employment dropped by 150K in November. Incredibly, full-time employment is STILL 2.4 million below where it was in November 2007 (seasonally adjusted and not seasonally adjusted) — seven long years ago. But yet, wer’re supposed to believe that Obama administration policies, and particularly Obamacare, have nothing to do with this incredibly depressing statistic.

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Econ catchup:

  • ISM Manufacturing — 58.7 percent, down only slightly from 59.0 percent
  • ISM Non-Manufacturing — 59.3 percent, up from 57.1 percent; this is was the opposite of another services-related report which indicated slower growth.
  • Vehicle Sales — up by 4.6% over November of last year; Chrysler continues to steal the show.
  • ADP — 208,000 jobs added

Predictions:

Not seasonally adjusted benchmarks:

October’s results actually exceeeded the benchmarks here, and the seasonally adjusted numbers understated the raw numbers’ strength.

Here are this month’s benchmarks:

  • 600,000 nonfarm jobs added.
  • 450,000 private sector jobs added.

The report will be here at 8:30.

December 4, 2014

Initial Unemployment Claims (120414): 297K SA; Raw Claims at 294K

Filed under: Economy,Taxes & Government — Tom @ 8:25 am

Last week, claims went above 300,000 for the first time in a while.

This week will be hard to evaluate because of the short Thanksgiving week, but here goes.

Prediction: Business Insider — 295,000 seasonally adjusted claims, down from 313K last week.

Seasonal Adjustment Factors:
- Week ended Nov. 29, 2014 — 99.1
- Week ended Nov. 30, 2013 — 101.5

Raw Claims:
- Week ended Nov. 22, 2014 — 355,887 (subject to revision)
- Week ended Nov. 30, 2013 — 321,896

Thanksgiving was NOT part of the “same” week last year, which throws attempts at analysis into further disarray.

The report will be here at 8:30 a.m.

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HERE IT IS (permanent link):

SEASONALLY ADJUSTED DATA

In the week ending November 29, the advance figure for seasonally adjusted initial claims was 297,000, a decrease of 17,000 from the previous week’s revised level. The previous week’s level was revised up by 1,000 from 313,000 to 314,000. The 4-week moving average was 299,000, an increase of 4,750 from the previous week’s revised average. The previous week’s average was revised up by 250 from 294,000 to 294,250.

… UNADJUSTED DATA

The advance number of actual initial claims under state programs, unadjusted, totaled 294,185 in the week ending November 29, a decrease of 62,943 (or -17.6 percent) from the previous week. The seasonal factors had expected a decrease of 46,132 (or -12.9 percent) from the previous week. There were 321,896 initial claims in the comparable week in 2013.

The raw claims number seems pretty high for a short week, but … last year’s Thanksgiving Week had 369,000 claims.

As one can best tell, it’s pretty much steady as she goes at just under 300K.

The Associated Press is carrying a FactSet prediction that tomorrow’s jobs report will show 225,000 establishment survey jobs added.

December 3, 2014

NY Post Columnist Betsy McCaughey Breaks News About Obamacare Regs the Press Has Ignored

New York Post columnist, legitimate constitutional scholar and health policy expert Betsy McCaughey broke news about the Affordable Care Act, aka Obamacare, in her Tuesday evening column. The Post should send the Associated Press, the New York Times and other establishment press outlets which have yet to report what she found the bill for her work.

In the midst of the Obama administration’s pre-Thanksgiving 3,415 regulations dump, McCaughey found several significant Obamacare-related items, most of which in quainter times would have been considered illegal, unconstitutional overreaches:
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November ADP: 208,000 Private Sector Payroll Jobs Added (See Conference Call Notes)

Filed under: Economy,Taxes & Government — Tom @ 8:38 am

From ADP:

Private-sector employment increased by 208,000 from October to November, on a seasonally adjusted basis.

  • Small businesses (1-49 employees) +101,000
  • Medium businesses (50-499 employees) +65,000
  • Large businesses (500 or more employees) +42,000

Bloomberg says that expectations were for +222K.

From the press release:

“November continued to show solid job growth above 200,000,” said Carlos Rodriguez, president and chief executive officer of ADP. “Small businesses continued to drive job gains adding almost half the total for the month.”

Mark Zandi, chief economist of Moody’s Analytics, said, “Steady as she goes in the job market. Monthly job gains remain consistently over 200,000. At this pace the unemployment rate will drop by half a percentage point per annum. The tightening in the job market will soon prompt acceleration in wage growth.”

* * * *

Conference call notes:

(Mark Zandi was not present. Did not get name of the substitute)

Accommodating the growing labor force. About twice as many as needed to satisfy growing working-age population.

200K fairly consistent for past 12 mos. Broad-based gains among all industries.

Small biz had almost half of small biz, sign of great momentum. Small biz access to credit has improved. Banks have eased lending standards(?). Consistent with what has been happening during past 3-4 mos.

Economy is returning to health.

On wages, pay increases are mostly not outpacing inflation for past couple of years (try 5-1/2, ma’am).

Texas is really doing well compared to other parts of the nation, and is seeing significant wage growth. Depends on part of country and industry sector, but signs are that wages are starting to pick up.

ADP has a quarterly index (“worker vitality index”) that is supposed to dig deeper into the labor markets. This data is showing acceleration in base wage growth. This should presage official reports which will show wage growth.

Questions:

Kathleen Madigan: Noted that the 208K number was floating around the markets before 8:15.

Dan Burns: Number was floating around on Twitter ahead of time for a few minutes. Response was that they were unaware, but they did note that CNBC has access to the data on an embargoed basis before the official release.

(There were no other questions. Not surprising, as the replacement presenter was very difficult to understand.)

December 2, 2014

Revisiting ‘It Matters,’ As the National Debt Surpasses $18 Trillion For the First Time

Filed under: Economy,Taxes & Government — Tom @ 2:17 pm

The Treasury official Debt to the Penny page currently shows the national debt as of Friday as $18.0055 trillion:

NationalDebtOver18Tril112814

That’s a threshold I very, very safely assumed the federal government would shortly reach when I had the “It Matters” song and video recorded and produced in September and October. The $18 trillion reference is at 1:58 in the video.

So here we are, and — given that there’s one more U.S. Senate election occurring Saturday in Louisiana — here’s a reminder to those in the Bayou State that getting involved and voting on Saturday could hardly be more important:

For those who are curious, I intend to produce additional videos to go with the song in the future. Given the establishment political class we currently have, the song itself is destined to remain relevant for quite some time.