The Economy

A really cogent interview with Nomi Prins about the Federal Reserve mostly, for anyone who is interested.

 

But not Jay Powell's UK.

25 basis points in the face of rampant inflation is like spitting into a hurricane, but least they did something and aren't just talking about what amazing inflation-fighters they are.

 

A decent-sounding jobs number just now. The expectations were for something weak, maybe 150K (with Omicron as the excuse), but it came in @ 467K.

Because of the jitteriness over the Fed, we are back to good news being bad news for markets again, with the idea being that they have no excuse to not tighten.

What makes me shake my head. ... everyone remember last month when the number disappointed with 199K? They revised it up now to 510K! . ... making all of the BS then (and the market reaction) moot.

Why people hang on this BS the way they do, and do Fed tea leave reading because of it, boggles me. But it's the game everyone feels they have to play. It's the modern equivalent of phrenology.

 

Or perhaps they should start defining what a job is the way the rest of us do it and then simply go out count those jobs via survey?

You know, rather than creating ever more complicated models that adjust for a gazillion factors and trends that are a reflection of their biases and political pressures? I actually think they have spun themselves into such a convoluted methodology that they no longer even have control over how ridiculous a number they are going to come up with in any given month, which was the point of all the manipulation in the first place when they started down this path in the 90s.

 

FYI, I just saw this post on Zero Hedge.

https://www.zerohedge.com/markets/here-whats-behind-todays-stunning-payrolls-beat

I have no way of knowing if they are right, but they are saying the BLS' seasonal adjustments are the culprit for how ridiculous the numbers have gotten. i.e. -- the BLS was applying seasonal adjustments over the Covid data for months creating nonsensical numbers.

And this morning, they responded by changing the actual numbers with a huge adjustment in the opposite direction that took the current number and the adjusted numbers they gave in the complete opposite direction.

At this point, they'd be better off just using a random computer generator and claiming that is the jobs number.

 

A convoluted game of statistical Twister. I flipped over to see the Walsh interview and those guys were beyond perplexed. I wasn't awake yet when the numbers came out so I can only imagine what that crew's reaction was at 8:30 a.m. EST.

 

I was watching the Walsh interview, saying how the numbers are credible and how he stands behind them.

I wish I could have gotten on the air with him, because I'd have pushed him to explain how the number is being calculated.

He has no clue.

Of course, though, the numbers are credible as far as he is concerned, because this month he gets to do the whole, "Look at how many jobs we created" thing.