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Tuesday, November 19, 2013

The BLS employment numbers are fake

As many suspected at the time, the pre-2012 election unemployment rate was even more fraudulent than is customary:
In the home stretch of the 2012 presidential campaign, from August to September, the unemployment rate fell sharply — raising eyebrows from Wall Street to Washington. The decline — from 8.1 percent in August to 7.8 percent in September — might not have been all it seemed. The numbers, according to a reliable source, were manipulated.

And the Census Bureau, which does the unemployment survey, knew it.

Just two years before the presidential election, the Census Bureau had caught an employee fabricating data that went into the unemployment report, which is one of the most closely watched measures of the economy. And a knowledgeable source says the deception went beyond that one employee — that it escalated at the time President Obama was seeking reelection in 2012 and continues today.

“He’s not the only one,” said the source, who asked to remain anonymous for now but is willing to talk with the Labor Department and Congress if asked. The Census employee caught faking the results is Julius Buckmon, according to confidential Census documents obtained by The Post. Buckmon told me in an interview this past weekend that he was told to make up information by higher-ups at Census.
Those of you who have read RGD will recall that in the chapter entitled "No One Knows Anything", I pointed out that the various numbers reported by the BLS and the BEA cannot possibly be legitimate. GDP, CPI, U3, all of them are fiction. The margins of error are greater than the difference between reported growth and reported contraction, thereby rendering Keynesian theory unworkable in practice. And they are extraordinarily expensive fictions, because material policies with effects in the trillions are being made and justified on the basis of those known and confirmed fictions.

This is just one more proof of the superiority of the Austrian logical approach to Keynesian pseudo-pragmatism. I once likened the attempts to manage the economy as trying to steer a car with a sledgehammer: it's not very precise and you're probably first going to wreck the steering wheel and then the car. But trying to manage the economy on the basis of numbers you know are manufactured is like trying to steer a car with a sledgehammer while wearing the wrong prescription sunglasses.

The Great Depression 2.0 is not coming. We are now in the fifth year of it, regardless of what the BLS and the BEA are telling you.

Labels:

125 Comments:

Anonymous p-dawg November 19, 2013 3:46 AM  

Q: How do you know when a government-issued report is false?

A: You're reading a government-issued report.

Anonymous Idle HAL 9000 November 19, 2013 4:00 AM  

Affirmative, Vox. I read you.

With the advent of Obamacare, the incompetence take-over is almost fully completed.

I've just picked up a fault in the US governmental unit. It's going to go 100% failure in 720 days.

Blogger JACIII November 19, 2013 5:07 AM  

The Nazis lied one time, therefore all governments lie all the time. Hmmmm. Whatever. ....er, uh, The US government lied one time so all governments lie all the time. Hmmmm. Whatever.

Blogger Doom November 19, 2013 5:13 AM  

I'm not a numbers guy. I just go by little factors, factors often reported honestly because they don't blow the propaganda as they aren't big enough, and what I see in my real life and sense generally. While I don't know that I would have braved calling it a depression, after reading RGD I could no longer NOT call it a depression. It all fit. It isn't short term, either. If government isn't shoved out of it, and there isn't a return to a free-market economy in truth, this can't get better.

Which is why, I believe, even if there was grobal warbling, and even if it were man made, the best thing all governments could do is... buy life preservers for New Yorkers and other underwater coastal cities and try to teach those without the preservers to clench and become watertight, therefor buoyant. Hey, it's the government, it's plans and advice aren't required to be sound, as long as they have something in place, right?

I love telling people we are in a depression. It's like planting a seed. Eventually, even some of the absolutely blind and stubbornly blissful have come around to the reality. They still hate me for having pointed it out, but... That gives me even more warm fuzzies. All good. Wait until they realize, next, that, yes, they really are going to hell, too. :)

You have been a wonderful influence, sir. Not just in one area or another. For that I thank you.

Anonymous kh123 November 19, 2013 5:38 AM  

Something else having happened behind Obama's golf stroke. Should start seriously thinking about either getting some glasses with internal mirrors, or a witch doctor to do away with this bad juju that keeps mucking it all up behind his back.

Blogger AdognamedOp November 19, 2013 5:49 AM  

How many impeachable offenses is this administration going to be involved in before the idiots on the other side of the aisle act?
The list of crimes is endless. Why the hell is no one in jail?
I guess the Bolshevik strategy of using a vibrant finger puppet is bringing results. No other Prez would get away with this shtuff. Hell, even if the opposititon did the right thing ,they'd be turned into a lynch mob by TPTB. We're fked. Shit's only gonna snowball faster and faster. The things that shocked us yesterday dont shock today.

Anonymous HongKongCharlie November 19, 2013 5:52 AM  

I just ran across this quote and after reading JAC lll's mindless rambling above I think it's time for this one.

H. L. Mencken (1880 - 1956): "As democracy is perfected, the office of the President represents, more and more closely, the inner soul of the people. On some great and glorious day, the plain folks of the land will reach their heart's desire at last and the White House will be occupied by a downright fool and complete narcissistic moron."

Did he call it or what? Nothing else to be said.

HKC

Anonymous Salt November 19, 2013 5:54 AM  

Special Report: The Pentagon's doctored ledgers conceal epic waste

Is there anything about the government not based on lies?

Anonymous Roundtine November 19, 2013 5:55 AM  

HK didn't collect economic data back when it was booming. The leadership worked on policies that would lead to growth. Here is the paper on it: Government Without Statistics. The paper takes the government to task for not collecting data, but the results were hardly negative.

Blogger Shimshon November 19, 2013 6:02 AM  

It would amusing if it weren't so destructive.

It's astounding how much faith is put into these numbers. Like they are holy writ. Even the inflation numbers, which are about as absurd as it gets. There isn't even the least bit of pondering by the media talking heads on how the definition has changed. How food and energy (two of the biggest expenses typical people have) are just excluded because they're "volatile" (as if that makes any sense anyway!) from "core inflation". I get the naive need to focus on numbers. But you'd think they'd want the numbers to be consistent and reliable and as broad as possible. No. If so-called "leading experts" say the change is justified, no matter how ridiculous, they all just parrot the talking point reasons, and continue spouting the new numbers, and move right along. A great number of them actually believe it too. It seems a small number do get it. But they often still spout nonsense with a straight face.

Anonymous hardscrabble farmer November 19, 2013 6:54 AM  

Are you saying that the government numbers are being tampered with? That they aren't telling the truth about the US economy in order to promote their own agenda?

I am gobsmacked.

Blogger Rantor November 19, 2013 6:55 AM  

I recently read that the Feds QE dollars get counted in the GDP estimates and that for the last few quarters they are the only thing keeping us out of statistical recession. Propping up the market is probably a secondary effect of QE ... I think keeping us out of statistical recession may be the primary purpose.

Anonymous FUBAR Nation Ben November 19, 2013 7:02 AM  

Here's another Mencken quote:

“All government, in its essence, is a conspiracy against the superior man: its one permanent object is to oppress him and cripple him. If it be aristocratic in organization, then it seeks to protect the man who is superior only in law against the man who is superior in fact; if it be democratic, then it seeks to protect the man who is inferior in every way against both. One of its primary functions is to regiment men by force, to make them as much alike as possible and as dependent upon one another as possible, to search out and combat originality among them. All it can see in an original idea is potential change, and hence an invasion of its prerogatives. The most dangerous man to any government is the man who is able to think things out for himself, without regard to the prevailing superstitions and taboos. Almost inevitably he comes to the conclusion that the government he lives under is dishonest, insane and intolerable, and so, if he is romantic, he tries to change it. And even if he is not romantic personally he is very apt to spread discontent among those who are.”

I think this sums up everything going on.

Anonymous PhillipGeorge(c)2013 November 19, 2013 7:05 AM  

There's only one rule in pragmatism. Do what works.

Problem is, they honestly don't know.

[the fear of the Lord is the beginning of wisdom..............ie. they are clueless]

Anonymous trk November 19, 2013 7:12 AM  

I was told that if I liked my real BLS data I could keep it

Anonymous scoobius dubious November 19, 2013 7:26 AM  

"How many impeachable offenses is this administration going to be involved in before the idiots on the other side of the aisle act?:

How long is it going to take you to understand that THERE IS NO "other side of the aisle"?

Appeals to Mencken quotes are pointless, as are all appeals to past American history for explanatory precedent, because the American people have been replaced, by immigrants, brain-washed zombies, and their hypnotizers, because Social Justice. There is no longer any "American people" in a politically meaningful sense. Using appeals to prior American history, or to prior American political thinkers like Mencken, from back when there were still Americans, is like thinking you can explain things in terms of analogies to the Dred Scott decision or the Missouri Compromise in a nation composed of Body Snatcher pods and their inevitable products. Because President Boyfriend. Because Fuck You, White Man. Because Ha Ha We Stole Your Country And Now It's Too Late, You'll Never Get It Back Again, Ever. Because Now We Can Do Whatever We Want, Your Tears Are Delicious To Us. Because We Hate You, We Always Did; All That Shit About Equality And Rights Was Just Cover To Get Us Inside The Castle Walls So We Can Strangle You In Your Beds And Rape the Shit Out of That Sweet, Sweet White Pussy.

"the incompetence take-over is almost fully completed"

It's not incompetence. But it IS a a take-over, and yes, it IS fully completed.




Anonymous Salt November 19, 2013 8:01 AM  

You really have to wonder why the abyss is being pursued so vigorously. It really is that MPAI and they gravitate to it because, as Erma Bombeck said, the grass is always greener over the spetic tank.

Anonymous zen0 November 19, 2013 8:06 AM  

HongKongCharlie November 19, 2013 5:52 AM

I just ran across this quote and after reading JAC lll's mindless rambling above I think it's time for this one.


Just to be clear, you do know that the mindless rambling was referencing leftist idiocy from a previous thread, right?

I would not want a Southron gentleman to suffer undeserved censure.

Blogger cmate November 19, 2013 8:07 AM  

"Because Now We Can Do Whatever We Want, ..."

Look no further than Obamacare. When it's convenient it's "the law of the land", when it's not, well, it's not.

Blogger Nate November 19, 2013 8:16 AM  

Voodoo. its all voodoo. It drives me to distraction that GDP has become such an accepted term.

One may as well claim to have come up with a method for weighing human souls... and then we could create a government department for soul measuring... and we could fret over the increases and decreases in soul weight.

Anonymous Anonymous November 19, 2013 8:18 AM  

Later in the linked article from ZH:

Don't hold your breath: the reason is that this particular instance manipulation is merely the tip of the iceberg - since virtually all data out of the BLS is manipulated and fabricated, as we report each and every month, the last thing the legislative and certainly the executive want is to offer the general public a glimpse of just how deep the rabbit hole goes. Because it goes very, very deep.


Does anybody here have any insight into how deep that rabbit hole is? What questions should we be asking ourselves, what should we be looking for?

Blogger Nate November 19, 2013 8:26 AM  

"Does anybody here have any insight into how deep that rabbit hole is?"

How deep is the rabbit hole? Its so big the metaphor doesn't actually apply... because there has to be dirt for there to be a rabbit hole.

There is no dirt.

All of it is made up. Pulled from thin air.

Anonymous Josh November 19, 2013 8:30 AM  

I'm wondering if we've reached Soviet economic bureau levels of inaccuracy.

Blogger Nate November 19, 2013 8:36 AM  

"I'm wondering if we've reached Soviet economic bureau levels of inaccuracy."

how can one method of weighing souls be more or less inaccurate than another?

Anonymous Josh November 19, 2013 8:39 AM  

how can one method of weighing souls be more or less inaccurate than another?

If real employment is 50mm, while saying it's 60mm would be inaccurate, saying it's 75mm or 100mm would be much more inaccurate.

Anonymous Josh November 19, 2013 8:41 AM  

Doesn't the IRS have records of the total number of people paying payroll taxes?

Using that number as the basis for measuring employment would be harder to fake than the current method.

And looking at state sales tax receipts would be a better method of measuring economic growth.

Blogger IM2L844 November 19, 2013 8:46 AM  

Does anybody here have any insight into how deep that rabbit hole is?

John Williams at ShadowStats spends a lot of time thinking about it.

Anonymous Josh November 19, 2013 8:48 AM  

Vox, if you were going to design a method for measuring employment and economic growth, how would you go about doing it?

Blogger James Dixon November 19, 2013 8:56 AM  

> Vox, if you were going to design a method for measuring employment and economic growth, how would you go about doing it?

Legal economic growth? As you said, Josh, tax receipts.

Now, measuring illegal or unreported economic activity is more problematic.

Blogger Nate November 19, 2013 9:01 AM  

"If real employment is 50mm, while saying it's 60mm would be inaccurate, saying it's 75mm or 100mm would be much more inaccurate"

There is no real employment.

Unemployment cannot be accurately measured... and estimates are mental masturbation.

Anonymous Maximo Macaroni November 19, 2013 9:05 AM  

Instead of Mencken, how about Gogol? In "Dead Souls", he described a system of counting serfs on large estates. When one died, his name was kept on the rolls anyway, so that the owner could still have collateral for loans. Eventually some estates had a surplus of non-existent serfs, representing only accounting entries. So they "sold" them to traveling entrepreneurs, who had a ready market in other landowners who needed loans but didn't have enough serfs to back up the loans.

I thought this was fiction. Or, at least, that things were no longer done this way. Silly me.

Anonymous Sigyn November 19, 2013 9:11 AM  

At some point, Nate is going to start a comment with "What if I told you", and I'm going to cry.

He's probably already wearing mirrored shades.

Anonymous Godfrey November 19, 2013 9:15 AM  

Another "conspiracy theory" is proven to be true.

Anonymous Carlotta November 19, 2013 9:16 AM  

@ Scooby

I have real faith that one day you will see who is the real enemy.

Blogger Nate November 19, 2013 9:18 AM  

consider the problems. Is a farmer's wife who works on the farm employed? is the store owner's wife that handles the store employed?

how do you determine who wants to work and who doesn't?

Its not even remotely possible.

Blogger JartStar November 19, 2013 9:20 AM  

Perhaps more important than faked numbers is the fact that now two government agencies, probably without explicit instructions, supported a candidate. The first we know of was the IRS, and now the BLS.

This is worrisome as it is a sign of a 2nd world nation that the government agencies who should at least strive for some neutrality of political party now support the candidates who they think will butter their bread. This has always gone on, but now it is obvious and blatant. The next step will be open nepotism and a return to patronage government.

Anonymous Godfrey November 19, 2013 9:22 AM  

@FUBAR Nation Ben November 19, 2013 7:02 AM


Thanks for the Mencken quote FUBAR. I'm going to keep that one. Like you said, I think that quote sums it up rather well.

Anonymous bob k. mando November 19, 2013 9:25 AM  

Josh November 19, 2013 8:48 AM
Vox, if you were going to design a method for measuring employment and economic growth, how would you go about doing it?




Vox's theoretical framework precludes the attempt at quantization.

the reason for this is that it is taken as axiomatic that HAVING an analytic metric for the economy, regardless of it's justification or actual utility, WILL result in that metric being corrupted.

because, just as with the specific case of Obama and the BLS, the short term personal political benefits to falsifying the numbers so outweighs the long term societal consequences that there is no way to police the numbers.

to have the numbers is to corrupt the numbers. Austrian theory states that one must use pure logical constructs for economic analysis for this reason.

there is a problem with the Austrian conceptualization. can you see what it is?

Anonymous Godfrey November 19, 2013 9:28 AM  

@Nate November 19, 2013 9:18 AM
"consider the problems. Is a farmer's wife who works on the farm employed? is the store owner's wife that handles the store employed? how do you determine who wants to work and who doesn't? Its not even remotely possible."


It's possible if we could just find the right god-like technocratic beings with impressive academic credentials to run everything for us. Have faith! (S)

Anonymous Carlotta November 19, 2013 9:30 AM  

I more wonder how the truth eventually gets out.

Maybe Crazy Uncle Joe is crazy like a fox.

Second, who was the manipulation of the numbers for? Was anyone voting for Romney and changed at the last minute because of this? I doubt it.

Blogger Nate November 19, 2013 9:33 AM  

"the reason for this is that it is taken as axiomatic that HAVING an analytic metric for the economy, regardless of it's justification or actual utility, WILL result in that metric being corrupted."

While that is a legitimate point... the main reason to not have these macro metrics is because they are simply not possible... and pretending otherwise is a waste of resources.

Anonymous Roundtine November 19, 2013 9:35 AM  

How food and energy (two of the biggest expenses typical people have) are just excluded because they're "volatile" (as if that makes any sense anyway!) from "core inflation".

Core inflation is not used to for calculating wages or benefits. The Fed uses core CPI because they believe it is a "cleaner" inflation number. Food and energy are volatile and so a number bouncing around is harder to read, but if the core number is steady, it means inflation isn't generalized. Think about it, if only food and energy are rising and core inflation is stable, it means there isn't a generalized inflation. The higher costs are due to food and energy. When price inflation does take off, the prices of everything move higher, some more than others, but there's a general move higher.

The BLS also does not assume people switch from steak to hamburger when calculating the CPI, what they assume is that people will buy the relatively cheaper steak.

Common Misconceptions about the Consumer Price Index: Questions and Answers
Specifically, in constructing the "headline" CPI-U and CPI-W, the BLS is not assuming that consumers substitute hamburgers for steak. Substitution is only assumed to occur within basic CPI index categories, such as among types of ground beef in Chicago. Hamburger and steak are in different CPI item categories, so no substitution between them is built into the CPI-U or CPI-W.

Furthermore, the CPI doesn't implicitly assume that consumers always substitute toward the less desirable good. Within the beef steaks item category, for example, the assumption is that consumers on average would move up from flank steak to filet mignon if the price of flank steak rose by a greater amount (or fell by less) than filet mignon prices. If both types of beef steak rose in price by the same amount, the geometric mean would assume no substitution.


I'm not going to defend the CPI, but too many of the criticisms out there are not very accurate. The info is right on the BLS website for anyone to read.

Anonymous Stilicho November 19, 2013 9:36 AM  

Does anybody here have any insight into how deep that rabbit hole is? What questions should we be asking ourselves, what should we be looking for?

For amusement, ask someone who is spouting off about a recovery and GDP to define GDP and explain how and why its constituent elements are calculated. Enjoy the show. 99.999% of people won't have a clue. Those who do will try to obfuscate and, if you persist in questioning them, be reduced to spluttering about how you just don't understand and that "top men" are in charge..."Top. Men."

For further amusement, repeat the process with "jobs reports", "unemployment rate", "birth/death model", "CPI", etc. Bonus points for asking them to define value. Eventually, you can reduce them to the semantic equivalent of bleating sheep who simply repeat their bleats in response to further questioning.

But this is all for amusement purposes only. None is so blind as he who will not see. As Vox says, no one knows anything. It's all a puppet show to distract the sheep while they are being sheared.

Anonymous Stilicho November 19, 2013 9:43 AM  

The next step will be open nepotism and a return to patronage government.

The next step will be .mil staging an event to help one candidate over another. After that, it's a short step to open endorsement, then open selection. Open nepotism and patronage are already with us.

Anonymous zen0 November 19, 2013 9:45 AM  

Food and energy are volatile and so a number bouncing around is harder to read,

That is a lame excuse. There are computers now. It would be easy to factor in an aggregate number. Have you ever heard of the cost of energy or food declining significantly? Consumers know better. That is why they look for sales because they know prices do not stay down.

Blogger Brad Andrews November 19, 2013 9:56 AM  

> "The Great Depression 2.0 is not coming. We are now in the fifth year of it, regardless of what the BLS and the BEA are telling you."

How does this fit with your side of the inflation-deflation debate Nate? Would you agree with this statement? Does it impact your position if so?

We are clearly in the middle of a mess, but I am not sure if it fits well or not. I suppose I should go back and read through the RGD. I didn't get far in, but it is still on my Kindle list.

Anonymous Anonymous November 19, 2013 9:56 AM  

Stilicho: Those who do will try to obfuscate and, if you persist in questioning them, be reduced to spluttering about how you just don't understand and that "top men" are in charge..."Top. Men."

I saw that in the Santelli clip at the ZH story. Santelli was correct, but the retort from the panelist was, "Show me better numbers! Where are your numbers!"

Had Santelli retorted with ShadowStats or some blogger, the response would had been the same as was seen in the AGW lie--officialdom vs 'just a blogger'.

Anonymous Roundtine November 19, 2013 10:01 AM  

Have you ever heard of the cost of energy or food declining significantly?

Food and energy costs plunged in 2008. Oil prices can swing up and down by 10-20% over the course of a few months.

The other CPI numbers are still reported. It's fair to criticize the Fed for using core CPI in their economic models, but that's the extent of it. All the other CPI numbers still exist, the core number is only watched because it is what the Fed watches and people are trying to guess Fed policy. People who think core CPI is the real CPI are being misled about it.

Blogger Nate November 19, 2013 10:02 AM  

"I'm not going to defend the CPI, but too many of the criticisms out there are not very accurate. The info is right on the BLS website for anyone to read."

Yes. And they are BS. Food and energy are two of the largest daily expenditures people have.

Blogger Nate November 19, 2013 10:06 AM  

"
How does this fit with your side of the inflation-deflation debate Nate? Would you agree with this statement? Does it impact your position if so?"

I don't disagree with the statement at all. Nor does it contradict my prediction. Hyper-inflation is not the result of a good economy getting to good to fast.

Its an explosion that is the result of people deciding that what has been functioning as money... is not in fact money anymore.

Anonymous Jamsco November 19, 2013 10:07 AM  

The Great Depression 2.0 is not coming. We are now in the fifth year of it

Wait, have you said this before? Did I miss you saying that we're in the depression.

And how many years would you guess we have to go?

I would have thought that a depression would be bad enough that people would know that we're in it.

Blogger AdognamedOp November 19, 2013 10:07 AM  

Carlotta November 19, 2013 9:16 AM

@ Scooby

"I have real faith that one day you will see who is the real enemy."

What makes you think he doesn't already know Carlotta?

Scoobs to me is two steps ahead of the game when it comes to laying blame. I mean, it's not like this is hard to figure out.
Who do you think is to blame?

Anonymous zen0 November 19, 2013 10:08 AM  

Stilicho reveals:


But this is all for amusement purposes only. None is so blind as he who will not see. As Vox says, no one knows anything.


The Bank of Canada concurs in a paper entitled " Evaluating Measures of Core Inflation":

There is no unique definition of core inflation and no
way to measure it directly


There is much more in the paper, of course, but it is useful to get the basics established aright.



Anonymous bob k. mando November 19, 2013 10:09 AM  

Nate November 19, 2013 9:33 AM
While that is a legitimate point... the main reason to not have these macro metrics is because they are simply not possible... and pretending otherwise is a waste of resources.



i believe Vox also made this point.

the deeper problem is that even if i wave my hand in the air and declare your problem of 'accurate quantization of the metric' as moot ...

there is still no way to get around the inherently corrupt nature of man.




simplytimothy November 19, 2013 9:56 AM
Santelli was correct, but the retort from the panelist was, "Show me better numbers! Where are your numbers!"



and this, in a nutshell, is the 'problem' with Austrian economic theory. when you have 'no numbers' the argument WILL come down to a competition between rhetoric and dialectic. and AEC, being dialectic, is not well suited to dealing with the rhetorical.

the 'problem' with AEC is extrinsic to the theory but intrinsic to the nature of man.

Anonymous Roundtine November 19, 2013 10:10 AM  

Food and energy are two of the largest daily expenditures people have.

Yes, daily expenditures. People get more angry about changes to prices of daily purchases because they can see price changes. They ignore price changes in something like a refrigerator, which they might buy once a decade.

Core CPI is to inflation as foreign aid is to the budget deficit. It's a sideshow. The real story is in rising healthcare and education costs due to government intervention, the inflation rates there are massive compared to food or energy.

Anonymous bob k. mando November 19, 2013 10:11 AM  

Jamsco November 19, 2013 10:07 AM
Wait, have you said this before? Did I miss you saying that we're in the depression.



WHAT is the name of Vox's notorious book on econ theory?

Blogger Nate November 19, 2013 10:12 AM  

"I would have thought that a depression would be bad enough that people would know that we're in it."

The people do know it. Everyone is just avoiding the word because the media is avoiding the word.

Anonymous jamsco November 19, 2013 10:14 AM  

WHAT is the name of Vox's notorious book on econ theory?

Yes, but I thought he was saying we were heading for it, not we were in it.

Anonymous Josh November 19, 2013 10:14 AM  

Wait, have you said this before? Did I miss you saying that we're in the depression.

Dude... He wrote a whole freaking book about it...

Anonymous The other skeptic November 19, 2013 10:14 AM  

Another "conspiracy theory" is proven to be true.

Yes, but what is the big lie?

Anonymous zen0 November 19, 2013 10:16 AM  

Jamsco objects:

I would have thought that a depression would be bad enough that people would know that we're in it.

I am sorry, but the "D" word has been banned from public discourse. Please try to control yourself.

Anonymous Salt November 19, 2013 10:16 AM  

I saw that in the Santelli clip at the ZH story. Santelli was correct, but the retort from the panelist was, "Show me better numbers! Where are your numbers!"

Most people will not accept anything unless it's stamped "Government Approved." This is why BS reigns.

Anonymous Sigyn November 19, 2013 10:16 AM  

I would have thought that a depression would be bad enough that people would know that we're in it.

Well, you have to keep in mind that we have more trappings of wealth, spread more broadly over the population, now than we did in 1.0. There are credit cards, so spending hasn't had to slow as much. And the media has a lot of stake in not playing up the bread lines right now.

It's like a famine in the land of the fat; you won't notice it as much because, while they're hungry, they're still going to be overweight for a long time.

Anonymous Stilicho November 19, 2013 10:16 AM  

the 'problem' with AEC is extrinsic to the theory but intrinsic to the nature of man.

That's like saying that the problem with the truth is that most people would rather believe a comforting lie. It may be accurate, but it should not give rise to a search for a better lie.

Anonymous jamsco November 19, 2013 10:18 AM  

Dude... He wrote a whole freaking book about it...

Yes, I know. That's why I said 'the depression'. I meant the one from the title.

Anonymous Huckleberry - est. 1977 November 19, 2013 10:19 AM  

I would have thought that a depression would be bad enough that people would know that we're in it

Do keep in mind that the EBT card has essentially replaced the old bread and food lines from the first Great Depression.
And the tent cities are going largely unreported by the media.
So that helps.

Blogger Tiny Tim November 19, 2013 10:21 AM  

My company is in the Eagleford Shale business. During the period mentioned above, the DOL called me and asked me if we were increasing our business. When I said yes, they said they wanted to use me in their business census. I was told basically "we are looking for companies to participate who are growing. We need to get the employment numbers up." We continue to grow. I am still in the census. The DOL calls me every month. They told me "never submit anything in writing" even though I have actual forms to fill out. It is always done verbally so as not to leave a paper trail.

I am a happy citizen and love my government. Obama is my hero!

Anonymous jamsco November 19, 2013 10:21 AM  

From the Amazon page of ROTGD:

"Then he turns to the six scenarios presently envisioned by the world's leading economists and assesses which is most likely to unfold. As the title suggests, Day concludes that the most probable scenario is a Great Depression 2.0 that will be larger in scale and scope than that of the 1930s."

This is all future tense.

Anonymous Stilicho November 19, 2013 10:25 AM  

Jamsco, the simple answer is "yes". Vox has long maintained that we are in a depression. In fact, if you want to have some fun with it, you could argue that Vox's position is pretty close to one where a depression was predestined due to the nature of our debt-based financial system and that only the elect can profit from such a system in the long term ...it's a little bit of a converse analogy, but I'm sure you could work it into to conversation somewhere...

Anonymous Stilicho November 19, 2013 10:26 AM  

This is all future tense.

Read the book

Anonymous bob k. mando November 19, 2013 10:28 AM  

jamsco November 19, 2013 10:14 AM
Yes, but I thought he was saying we were heading for it, not we were in it.




all one need do is read the Amazon summary:
http://www.amazon.com/The-Return-Great-Depression-Vox/dp/1935071181/ref=sr_1_cc_1?s=aps&ie=UTF8&qid=1341842270&sr=1-1-catcorr&keywords=Return+great+depression
"Day applies a different theory, the one he used to predict the current crisis, to show that the world is in the early stages of a massive economic contraction. Then he turns to the six scenarios presently envisioned by the world's leading economists and assesses which is most likely to unfold. As the title suggests, Day concludes that the most probable scenario is a Great Depression 2.0 that will be larger in scale and scope than that of the 1930s.



zen0 November 19, 2013 10:16 AM
I am sorry, but the "D" word has been banned from public discourse. Please try to control yourself.



this.

in the same way that <5% unemployment under Bush in 2008 was the worstest economy EVER while >8% unemployment was played up as FUNemployment under Obama in 2010, every major media mouthpiece is corrupt. they will NOT call it a 'depression' so long as 'their team' is in office.



Stilicho November 19, 2013 10:16 AM
It may be accurate, but it should not give rise to a search for a better lie.



i never said that AET was a lie or that it told you to look for a better lie.

Anonymous Stilicho November 19, 2013 10:29 AM  

Tiny Tim, record such conversations and distribute to ZH et al. Or send it to Vox for resurrection of his podcast.

Anonymous Josh November 19, 2013 10:29 AM  

In fact, if you want to have some fun with it, you could argue that Vox's position is pretty close to one where a depression was predestined due to the nature of our debt-based financial system and that only the elect can profit from such a system in the long term ...it's a little bit of a converse analogy, but I'm sure you could work it into to conversation somewhere...

Freaking awesome

Anonymous bob k. mando November 19, 2013 10:31 AM  

jamsco November 19, 2013 10:21 AM
This is all future tense.



no, it's not. i even quoted and bolded the relevant portion for you.

but now that you've phrased it that way i have an excuse to kick some April Wine. i call that, Charlie Sheen winning!
http://www.youtube.com/watch?v=JQbE-6i16YM

Anonymous Stilicho November 19, 2013 10:31 AM  


i never said that AET was a lie or that it told you to look for a better lie.


No, you said that the truth of AET was a problem. In fact it is a feature, not a bug. Acceptance by the masses is irrelevant.

Anonymous CarpeOro November 19, 2013 10:34 AM  

"You really have to wonder why the abyss is being pursued so vigorously. It really is that MPAI and they gravitate to it because, as Erma Bombeck said, the grass is always greener over the spetic tank. "

Don't forget that for every disaster there are some that prosper from it. Hence the current administration slogan "Don't let a disaster go to waste" (close enough for gubmint work).

Anonymous MendoScot November 19, 2013 10:34 AM  

One may as well claim to have come up with a method for weighing human souls... and then we could create a government department for soul measuring... and we could fret over the increases and decreases in soul weight.

Stop minimizing the problem of spiritual obesity, Nate. It's a pandemic of Pandoric proportions promoting Pandemonium.

And the soul weighs 1/6oz, IIRC. I don't have the reference to hand, but I believe that was determined by an English physician at the end of the 19th century.

Ah, no. 21g, Duncan MacDougall, Massachusetts, 1907.

Anonymous jamsco November 19, 2013 10:37 AM  


no, it's not. i even quoted and bolded the relevant portion for you.

Here's what you bolded:

is in the early stages of a massive economic contraction.

This sounds like "we are heading for it, not we are in it" which is how I described it.

If anyone could find one place where Vox says "we're currently in the depression ", then I'd be proven wrong. It's quite possible that he said this, I just don't remember it.

Anonymous MendoScot November 19, 2013 10:37 AM  

Yeesh, that was not the link

Anonymous Stilicho November 19, 2013 10:38 AM  

And the soul weighs 1/6oz, IIRC. I don't have the reference to hand, but I believe that was determined by an English physician at the end of the 19th century.

But what is the velocity?

Anonymous Anonymous November 19, 2013 10:47 AM  

The Great Depression 2.0 is not coming. We are now in the fifth year of it, regardless of what the BLS and the BEA are telling you.

I heard a commentator on MSNBC this morning practically choke while talking about our "exceptionally slow recovery".

Anonymous Josh November 19, 2013 10:48 AM  

Jamsco:

Thus spake Vox: the economy is in a depression, not a recession.

Anonymous jamsco November 19, 2013 10:51 AM  

Yes. And I also found this:

"Because Sowell subscribes to neo-classical economic theory, he has no idea why the Great Depression occurred and he still hasn't recognized that we are in the Great Depression 2.0."

So I was wrong. Apologies.

Anonymous The other skeptic November 19, 2013 10:52 AM  

Some fools now think Romney would have been better.

Anonymous zen0 November 19, 2013 10:59 AM  

And the soul weighs 1/6oz, IIRC. I don't have the reference to hand, but I believe that was determined by an English physician at the end of the 19th century.

I call Balderdash, Sir!
If people's corporal manifestations are of such a range and diversity to make one marvel at how many funny-looking people there are downtown these days, how on earth can all their souls be equal in weight?

Moar egalitarian nonsense, I suspect.

Anonymous Jill November 19, 2013 11:03 AM  

"One may as well claim to have come up with a method for weighing human souls..." Oh, but Nate, one has come up with a method of weighing souls!! It's for real! Oh, ye of little faith.

"The margins of error are greater than the difference between reported growth and reported contraction, thereby rendering Keynesian theory unworkable in practice." Yes, yes, yes! I also like your term "pseudo pragmatism" This gets down to why I rejected the idea of Keynesian economics a long time ago: pseudo pragmatism. Yep.

Anonymous Josh November 19, 2013 11:05 AM  

He has seen his lead among young voters (18-39 years old) drop from 18 percent to 2 percent.

Wow.

Anonymous The other skeptic November 19, 2013 11:11 AM  

Cheaters want government jobs

Anonymous patrick kelly November 19, 2013 11:16 AM  

I go by the PKI. It consists of a loaf of bread, a dozen eggs, a 6 pack of Shiner, Handle of R&R, a gallon of gas, and a box each of 5.56, 45acp, and 9mm. I would include some good red wine and a cigar in there somewhere, but I can't decide on what the standard would be. Divide my weekly pay by this to see how much I can buy and that's the PKI.

Right now it's relatively high mostly due to gas and ammo price drops (higher is better for me), it has been worse. Peaked early 2001, been going down ever since.

The reason people don't think we're in a depression is because all the masses collecting phones, birth control, food, housing, and cash from the safety nets aren't out in bread lines, soup kitchens, or rioting............yet...... Back in the GD they were more visible and made the headlines as something bad. Now some people actually count these increasing numbers as a good thing. Means we're progressing apparently........

Anonymous MendoScot November 19, 2013 11:31 AM  

If people's corporal manifestations are of such a range and diversity to make one marvel at how many funny-looking people there are downtown these days, how on earth can all their souls be equal in weight?

You are a filthy soulist. All souls weigh the same in grams because the metric system is superior! That is why the Supreme Being will let us all into the Elysian Fields.

Except those who cling bitterly to their Imperial measures. Especially the Trojans.

Anonymous DonReynolds November 19, 2013 11:34 AM  

I remember the feeble excuse my economics professor gave me, when I (frequently) cast doubt on government statistics. He said it is like flying an airplane (in dense fog, I would imagine), where you are completely dependent on your instruments to keep you informed of altitude, airspeed and direction. If you do not trust your instruments, you are likely to nosedive into the ground.

But of course, it was a terrible analogy because in economics we are NEVER completely dependent on our instrument readings. To continue with the professor's analogy, normally we refer to our instrument readings while flying in daylight hours or being able to see lights on the ground.....or on top of radio towers and water storage tanks.

More particularly, we would not rely on instrument readings we know for a fact are not functioning or not functioning correctly. Bismark said that anyone who likes laws and sausages should never watch them being made.....to which I would add "government statistics", having been the person who did that for a number of years.

Anonymous Stilicho November 19, 2013 11:38 AM  


Except those who cling bitterly to their Imperial measures. Especially the Trojans.


Once, Britain used the English system and a gold Sovereign was the coin of the realm. During this period, Britain conquered the largest empire in history. Later, that system fell into decline. So did the empire.

You, sir, must be a Frenchman.

Anonymous cmc November 19, 2013 11:50 AM  

Lulz. The media. Kelly Evans on Squawk Box just now asked Congresswoman Diane Black if maybe it was just one employee 'trying to keep up with his workload'.

Anonymous bob k. mando November 19, 2013 11:53 AM  

Stilicho November 19, 2013 10:31 AM
No, you said that the truth of AET was a problem.


[ facepalm ]

no. i didn't.

the truth / falsehood value of AET is irrelevant to the problem at hand. the problem at hand is, 'how do we decide which theory we will use to solve this problem of economic contraction'.

AET has been getting it's ass kicked *in the public policy world* for most of a century now.

time to learn how to utilize rhetardoric, boys. ( note: this still doesn't mean 'lie' )

even after they learn rhetardoric, AET will still be hamstrung by the fact that it does not provide a policy justification for meddling in the economy. which is, of course, the primary need of TPTB.



Stilicho November 19, 2013 10:31 AM
Acceptance by the masses is irrelevant.



yes. completely irrelevant.

right up until it comes time to make a public policy decision.

at which time AET falls on it's face.




jamsco November 19, 2013 10:51 AM
So I was wrong. Apologies.


[ shrugs ]

just because i've received the opening kick off in the Super Bowl doesn't mean i'm not in the Super Bowl because the 60 minute game clock hasn't run out yet.

if you don't recognize 'massive economic retraction' as being co-equivalent with an economic depression i can't help you.
http://dictionary.reference.com/browse/depression?s=t
5. an economic condition characterized by substantial and protracted unemployment, low output and investment, etc; slump

how's that unemployment rate in Greece and Spain again? what's the labor participation rate in the US? why do we keep seeing stories about declining Chinese power consumption and empty cities? what's up with the Baltic Dry Index shipping rates?


the whole thesis of the book is that we're in a massive and natural economic correction, the effects of which the government is doing its utmost to prevent from eventuating. the longer the .gov succeeds in kicking the can down the road, the worse the eventual bottom will be.

Anonymous bob k. mando November 19, 2013 11:57 AM  

DonReynolds November 19, 2013 11:34 AM
If you do not trust your instruments, you are likely to nosedive into the ground.




hey, i'm intentionally going to use an artificial horizon which is never less than 90 degrees out of plum and an altimeter which never indicates less than 1000' higher than actual.

watch what happens when i black out the cabin windows.

Blogger Nate November 19, 2013 11:57 AM  

"yes. completely irrelevant.

right up until it comes time to make a public policy decision.

at which time AET falls on it's face."

No. It doesn't fall on its face.

It just doesn't tell the Do_Somethings what they want to here.

Anonymous bob k. mando November 19, 2013 12:08 PM  

already covered that, Nate.

Anonymous patrick kelly November 19, 2013 12:25 PM  

More like covered it up...

Anonymous bob k. mando November 19, 2013 12:28 PM  

what did i say was "... the primary need of TPTB", again?

Blogger JCclimber November 19, 2013 12:51 PM  

Just look at the EBT numbers.
By the way, you hear about how the EBT disbursements were cut 6% because of government mandatory cuts?

Right. Here's how it works. About 6 weeks before the mandatory cuts, they raised almost everyone's limits based on "adjustments to income" or "area price index changes" or "quarterly review of needs assessments". Then about 4-8 weeks later, they make the mandatory cuts. Which cut you back to around the exact same level that you were receiving previously.

The thing is, the "raises" were handled individually, with no big announcement, and at least appear to be a case by case adjustment. So all the public is left with is the media trumpeting MANDATORY SPENDING CUTS HITS ALL EBT PAYMENTS!

Notice how no one is taking to the streets because of EBT cuts? It's because they are getting about the same amount of money as before and don't want to rock the boat.

Blogger James Dixon November 19, 2013 12:54 PM  

> About 6 weeks before the mandatory cuts, they raised almost everyone's limits based on "adjustments to income" or "area price index changes" or "quarterly review of needs assessments".

Anyone want to bet those raises were almost entirely to urban areas?

Anonymous patrick kelly November 19, 2013 12:57 PM  

Apparently truth falls on its face when it doesn't meet the primary need of liars.

Anonymous Jack Amok November 19, 2013 1:00 PM  

The people do know it. Everyone is just avoiding the word because the media is avoiding the word.

Yep, they know. They see empty store fronts, they see older and older cars on the road. They see their own costs rising. They see friends, family and neighbors struggling. They know. What they don't know - the majority of them anyway - is what to do about it.

The problem is, the people who voted for the clowncar of politicians we have think the solution to our economic malaise is a bigger car with more clowns. "Obama will save us", and if they lose confidence in him, they'll just turn to Hillary, or Rahm, or whoever is the next clown up in the queue.

What they don't want to accept is that the system is broken. They keep hoping that a better, kinder, more noble politician will come along and make it all work for them. Our problem is not that we have clowns like Obama, it's that we put them in charge.

We have the wrong people making political decisions.

Anonymous Molon Rouge November 19, 2013 1:09 PM  

And, this all culminates in the coronation of Hillary in 2016. A final ending for a grand experiment. The Curie-Hultgren factor will be in full play.

It will be a day long remembered in the Empire!

Anonymous Ferd November 19, 2013 1:20 PM  

"consider the problems. Is a farmer's wife who works on the farm employed? is the store owner's wife that handles the store employed?"



If a person becomes unemployed on a cold winter's night in December, are they counted in the government's roll on a bitter, clear day in January?

Anonymous FP November 19, 2013 1:24 PM  

Stilicho: "Once, Britain used the English system and a gold Sovereign was the coin of the realm. During this period, Britain conquered the largest empire in history. Later, that system fell into decline. So did the empire."

The metric system is a tool of the devil. My car gets 40 rods to the hogshead and thats the ways I likes it!

Anonymous scoobius dubious November 19, 2013 1:24 PM  

"What they don't want to accept is that the system is broken."

Clearly what we need to do to boost the economy, is fix our broken immigration system. Millions and millions and millions of new, needy immigrants will be just the ticket to grow our economy back into prosperity. Illiterate low-IQ ever-pregnant paupers ALWAYS create wealth! That's WHY they're poor!! And grasping sharp-elbowed nepotistic high-IQ Asian immigrants create wealth too! They just don't disclose it to the gubmint, is all. But that's okay, because social justice!

Blogger JCclimber November 19, 2013 1:28 PM  

" Illiterate low-IQ ever-pregnant paupers ALWAYS create wealth! That's WHY they're poor!! And grasping sharp-elbowed nepotistic high-IQ Asian immigrants create wealth too! They just don't disclose it to the gubmint, is all. But that's okay, because social justice!"

I admit it, I laughed out loud. Startling my coworkers, no doubt.

Blogger Nate November 19, 2013 1:34 PM  

"already covered that, Nate."

No mate. You didn't.

You pointed out the obvious... which is that keynesianism tells them what they want to hear. Austrian Economics tells them exactly what they do NOT what to here.

Anonymous MendoScot November 19, 2013 1:37 PM  

During this period, Britain conquered the largest empire in history. Later, that system fell into decline. So did the empire.

You, sir, must be a Frenchman.


Call me a Frenchman if you will, just do not defend to my face Perfidious Albion and her demonic, warmongering Bank (even if it was founded by a Scot).

And speaking of fake numbers...

...Argentina's new Economy Minister is the unrepentant Marxist and ultra-Keynsian Axel Kicillof, who has promised to "print, print, print" until Argentina's economy takes off like a Mighty Condor! The head of the Central Bank, who made the mistake of whimpering about expanding the monetary base at a mere 40% per year, has been replaced with someone more compliant.

Paul Krugman must be wetting himself with anticipation that now, finally, someone has the huevos to show the world how to do it right.

Anonymous MendoScot November 19, 2013 2:03 PM  

My car gets 40 rods to the hogshead and thats the ways I likes it!

'Struth! But 40 rods? Methinks yer alesman in selling you X.

Mine gives two furlong to the drachm, and that into wind.

Anonymous MendoScot November 19, 2013 2:09 PM  

Aaaand, I just found the Simpsons' quote. I need to get back to work.

Anonymous bob k. mando November 19, 2013 2:12 PM  

patrick kelly November 19, 2013 12:57 PM
Apparently truth falls on its face when it doesn't meet the primary need of liars.



amusing, but wrong.

truth falls on its face when it fails to deal aggressively with the corrupt and to deal with the corrupt in a way that will bring the corruption down.

i mean, you are aware that marxist socialism was, by far, the dominant global ideology of the 20th century, yes? and that they murdered ~100 million people?

had truth destroyed/imprisoned Marx and his co-travellers in the mid-19th century and refused to allow his ideologues to take over the colleges then we would never have had tens of millions of people murdered less than a century later.

imagine that. completely nonexistent in 1848 to Lenin murdering people by the tens of millions by 1925. that's an acceleration rate that would do a Corvette proud.

is Marxism true? it certainly was successful.



Nate November 19, 2013 1:34 PM
Austrian Economics tells them exactly what they do NOT what to here.



yes, i said that already.

"AET will still be hamstrung by the fact that it does not provide a policy justification for meddling in the economy. which is, of course, the primary need of TPTB."

i'm using AET as an acronym for 'Austrian Economic Theory'. AET says to provide solid money, low taxes and get the hell out of the way.

no handle for TPTB to control people with.

Anonymous Will Best November 19, 2013 2:12 PM  

Business Insider had a pretty good take down of this article. The main argument being that the Philly region unemployment barely moved therefore falsifications in the Philly data would not have caused a nation wide decline in unemployment rate.

My response to them however, since they appear to admit that falsifications were occurring in Philly, the government is not entitled to a presumption of system integrity and in fact the default analysis should be that of corruption until otherwise proven.

In fact, the question ought to be: Why does Philly struggle to achieve 90% when other regions don't seem to have that problem. Are the people in that region just busier or less likely to comply than the other regions? Are the employees there more incompetent and less motivated? etc.

Anonymous DonReynolds November 19, 2013 2:50 PM  

bob k. mando....."hey, i'm intentionally going to use an artificial horizon which is never less than 90 degrees out of plum and an altimeter which never indicates less than 1000' higher than actual.
watch what happens when i black out the cabin windows."

Great idea, bob. I will watch from a safe distance. Send me a postcard.
Ha ha.

Anonymous Stilicho November 19, 2013 3:26 PM  

the truth / falsehood value of AET is irrelevant to the problem at hand. the problem at hand is, 'how do we decide which theory we will use to solve this problem of economic contraction'.


Demonstrably wrong. The truth of an economic theory is essential to the ability of that theory to solve an economic problem. Selling snake oil to the masses, however effectively, will not solve an economic problem.

Now, you appear to want to sell AET, which you accept as true (as do I for the most part), to a population that is little inclined to accept it. That's a problem, but it's the secondary problem. Because you have already solved the first problem (the truth of AET), does not mean that the problem did not exist.

Anonymous patrick kelly November 19, 2013 3:43 PM  

Anxiously awaiting the revelation of a false theory which will solve economic problems.

Anonymous patrick kelly November 19, 2013 3:45 PM  

The instruments are all broken, but it will all be ok if we can sell this plane to the right pilot who will fly us off to safety.....

Anonymous Concerned Rabbit Hunter November 19, 2013 3:46 PM  

"Selling snake oil to the masses, however effectively, will not solve an economic problem."

It will solve some people's economic problem. Welcome to the machine.

Blogger Nate November 19, 2013 4:17 PM  

"yes, i said that already."

/facepalm

I know you said it already Bob. That's what I meant when I said "you pointed out the obvious."

No one here has any illusions about TPTB adopting AET.

All we hope is that the future powers that be learn from the giant clusterfutastrophe that Keynesianism has wrought... and decide they can make more money for themselves if they do NOT go down that road.

Anonymous bob k. mando November 19, 2013 4:32 PM  

Stilicho November 19, 2013 3:26 PM
Demonstrably wrong. The truth of an economic theory is essential to the ability of that theory to solve an economic problem.




Demonstrably wrong. The truth of an economic theory is irrelevant to the ability of that theory to solve an economic problem if those in power refuse to utilize that theory..



Nate November 19, 2013 4:17 PM
I know you said it already Bob.



odd. i could have sworn you told me that i didn't say that.

the Natespielling correction must be disorienting my language comprehension. ;-p


Nate November 19, 2013 1:34 PM
No mate. You didn't.



and i think we're all agreed that an immoral people will not select a moral PTB. which is the precondition necessary for a correct theory of economics to function properly.

hence, my occasional jeremiad about the US no longer being a Christian nation.




Anonymous wcu November 19, 2013 5:04 PM  

Get you some farm land/ hunting land, barter...we'll ride this bitch out!

Blogger JartStar November 19, 2013 5:35 PM  

Here's some real hyperinflation for ya.

Blogger Nate November 19, 2013 6:47 PM  

"odd. i could have sworn you told me that i didn't say that."

Selectively edit much?

Anonymous Saint Revolution November 19, 2013 9:22 PM  

Correction, Vox.

We are in the 6th year, moving into the 7th year. The freemason one world order Wall street government engineered Depression began Nov./Dec. 2007.

I know. With 3 college degrees and ~29 years of experience, I have been unemployed for the whole time.

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