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Saturday, October 6, 2012

Joe Nocera, "Jobs Report: Cooked or Correct?": Ignoring the Answer

Yesterday, it was announced that the US unemployment rate had remarkably dropped from 8.1 percent in August to 7.8 percent in September. Lead articles in The Washington Post (http://www.washingtonpost.com/politics/decision2012/fall-in-jobless-rate-strips-romney-of-an-argument/2012/10/05/c1e3f3c2-0f1f-11e2-a310-2363842b7057_story.html) and The New York Times (http://www.nytimes.com/2012/10/06/business/economy/us-added-114000-jobs-in-september-rate-drops-to-7-8.html?pagewanted=all) crowed that these figures have reinvigorated the Obama campaign following the president's debate debacle. From the right we are hearing that the figures could well be inaccurate (see, e.g.: http://www.commentarymagazine.com/2012/10/05/the-jobs-report-ii/). Jack Welch, former chairman and CEO of General Electric, tweeted (https://twitter.com/jack_welch/status/254198154260525057): "Unbelievable job numbers . . these Chicago guys will do anything . . can't debate so change numbers."

In his latest New York Times op-ed entitled "Jobs Report: Cooked or Correct?" (http://www.nytimes.com/2012/10/06/opinion/nocera-jobs-report-cooked-or-correct.html?_r=0), Joe Nocera concludes:

"But the data were largely overwhelmed by positive signals. In its revised figures for July and August, for instance, the bureau said that more jobs had been created than it originally estimated. People with only high school degrees were finding jobs. The number of people who had been out of work for six months or more was at its lowest point in three years.

Whether the Republicans like it or not, the economy is slowing getting better.

Awful, isn’t it?"

Hallelujah, we're back on the road to recovery! Or are we?

Me? I don't need Joe Nocera or Jack Welch to tell me if the unemployment figures are real, cooked or arbitrary, given that we are all privy to the ultimate arbiter.

If this surprising data was correct, we should have seen a positive response in the US financial markets on Friday. Instead, the Dow Jones Industrial Average added only 0.2%, Nasdaq fell 0.4%, and the S&P 500 ended unchanged.

Sorry, but the US economy, which will ultimately improve somewhat regardless of the outcome in November ("after winter comes the spring"), remains in a funk.

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