{"id":346,"date":"2010-02-05T10:33:00","date_gmt":"2010-02-05T15:33:00","guid":{"rendered":"http:\/\/www.intuitiveinvestor.com\/web\/?p=346"},"modified":"2018-08-21T09:17:49","modified_gmt":"2018-08-21T13:17:49","slug":"its-the-unemployment-rate-stupid","status":"publish","type":"post","link":"https:\/\/jasonapollovoss.com\/web\/2010\/02\/05\/its-the-unemployment-rate-stupid\/","title":{"rendered":"It\u2019s the unemployment rate, stupid"},"content":{"rendered":"

This morning the Department of Labor announced that the U.S. economy lost 20,000 jobs in January.\u00a0 Note the round figure; this is always a sure sign of an estimated number.\u00a0 No big shakes there as the DoL’s jobless rate figure is always an estimate that gets revised multiple times before the figure is “official.”\u00a0 Which brings me to December’s revised figure of 150,000 jobs lost vs. an initially reported number of 85,000 jobs lost.\u00a0 So basically, the initial unemployment figure was off by an amount equal to the population of my hometown of Santa Fe.\u00a0 Crazy!\u00a0 But crazier still is the fact that the economy lost 20,000 jobs in January but the unemployment rate improved by going down to 9.7% from 10.0%!\u00a0 Huh?\u00a0 How is that friggin’ possible?\u00a0 The decline is possible because the unemployment rate only counts people who are actually looking for a job.\u00a0 So if you have given up finding a job then you are not counted as unemployed.<\/span><\/p>\n

Analysis:<\/strong>\u00a0Folks, I have to tell you, this is NOT a good sign.\u00a0 One, the economy continues to lose jobs.\u00a0 Two, this means that it is not really adding jobs.\u00a0 So, three, job seekers are getting frustrated and stopping looking.\u00a0 This means that there is a building “inventory” of prospectively employed folks.\u00a0 When the economy definitely improves and businesses begin hiring again they are going to have to ultimately absorb enormous amounts of people to make a dent in the unemployment rate.\u00a0 Because what will happen is that the folks who “have given up looking” will suddenly start looking for work again.\u00a0 This will mitigate against the hiring done by businesses in terms of making a dent in that unemployment rate.\u00a0 So the unemployment rate is likely going to stay ugly for a long time.\u00a0 Psychologically speaking, this is not a good thing.<\/span><\/p>\n

Oh, and by the way, the DoL also announced today that its estimate of job losses for 2009 was off by a staggering 600,000.\u00a0 Basically we are talking about a revision equivalent to the population of my home state of New Mexico.\u00a0 Ouch!<\/span><\/p>\n

Meanwhile CNN (Celebrity News Network) misleadingly states as its headline: “Jobless rate falls to 9.7%.”\u00a0 Nice.\u00a0 Nice if you like lies of omission.<\/span><\/p>\n

Importance grade:<\/strong> 10; There is no single more important economic\u00a0statistic in the world right now than the U.S. unemployment rate.\u00a0 The U.S. consumer is the backbone of the world’s economy and financial system.\u00a0 As long as they remain unemployed they remain cautious about spending.<\/span><\/p>\n

Open comment to President Barack Obama and the U.S. Do Not (Senate) and the House of Vituperatives (Representatives): It’s the unemployment rate, stupid!<\/strong><\/span><\/p>\n

Jason<\/span><\/p>\n

PS – Blogger got rid of its spell check function so I apologize in advance for any forthcoming spelling errors.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

This morning the Department of Labor announced that the U.S. economy lost 20,000 jobs in January.\u00a0 Note the round figure; this is always a sure sign of an estimated number.\u00a0 No big shakes there as the DoL’s jobless rate figure is always an estimate that gets revised multiple times before the figure is “official.”\u00a0 Which […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[12,3],"tags":[],"class_list":["post-346","post","type-post","status-publish","format-standard","hentry","category-best-of-the-blog","category-the-blog"],"_links":{"self":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/posts\/346","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/comments?post=346"}],"version-history":[{"count":0,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/posts\/346\/revisions"}],"wp:attachment":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/media?parent=346"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/categories?post=346"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/tags?post=346"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}