US unemployment rate decreases from 6.3% to 6.1% in July 2014

[Associate Justice PiT]

     So the President's proponents trumpet the numbers and his opponents illustrate the hidden problems that they do not reflect. If the roles were reversed and we had a Republican in the White House, I could just as easily see the roles of the posters in this thread being reversed.

[jaichind]

     So the President's proponents trumpet the numbers and his opponents illustrate the hidden problems that they do not reflect. If the roles were reversed and we had a Republican in the White House, I could just as easily see the roles of the posters in this thread being reversed.

Not true.  See something I wrote back in 2004.

Unemployment's down to 5.6 and shrinking. Not as low as people thought it might go, but that's good because the Fed won't mess with the bond rate. The economy is on the way up. Eventually we should reach a boom, probably early next year.

The issue I'm most worried about is WMD. Bush is now saying that we might have been wrong in Iraq, but he didn't do it purposefully if so, and there were still perfectly good reasons to go to war (better ones actually, Saddam supported terror, was a monstrous dictator who had to go as soon as possible, and his fall could spur a democratic outburst acroos the Mideast.) This is actually a decent argument and if it is the major issue, Bush will win reelection. BUT though it is not a real political problem, it could be a policy problem. Say the ayatollahs are on the verge of acquiring a warhead. Bush says we must consider military options, and the media and the libs will go, "fool me twice, shame on me". Effectively it could make it politically impossible for the USA to save the Middle East from becoming so much radioactive slag.

Bush can talk about the decrease in unemployment rate to 5.6% all he wants but the fact is that total labor participation rate is still just 66.1%, no higher than most of last year.  While 112,000 jobs were added, about 76,000 of it are in the retail industry.  Due to a weak retail holiday season late last year, not as much retail employment did not increase much late last year and as a result the increase in retail employement in January 2004 is artifical as less surplus retail employees are laid off.  Besides, most of these jobs are low paying service jobs and reflect the fact that the structural economic problems in the US economy are unresolved.  While these problems are not the result of the actions of the Bush administration, it has do nothing to solve them and in fact make them worse on the long run.  The fact is the Bush administration is the first administration to have a net negative change in employment since the Hoover administration.

[Associate Justice PiT]

     So the President's proponents trumpet the numbers and his opponents illustrate the hidden problems that they do not reflect. If the roles were reversed and we had a Republican in the White House, I could just as easily see the roles of the posters in this thread being reversed.

Not true.  See something I wrote back in 2004.

Unemployment's down to 5.6 and shrinking. Not as low as people thought it might go, but that's good because the Fed won't mess with the bond rate. The economy is on the way up. Eventually we should reach a boom, probably early next year.

The issue I'm most worried about is WMD. Bush is now saying that we might have been wrong in Iraq, but he didn't do it purposefully if so, and there were still perfectly good reasons to go to war (better ones actually, Saddam supported terror, was a monstrous dictator who had to go as soon as possible, and his fall could spur a democratic outburst acroos the Mideast.) This is actually a decent argument and if it is the major issue, Bush will win reelection. BUT though it is not a real political problem, it could be a policy problem. Say the ayatollahs are on the verge of acquiring a warhead. Bush says we must consider military options, and the media and the libs will go, "fool me twice, shame on me". Effectively it could make it politically impossible for the USA to save the Middle East from becoming so much radioactive slag.

Bush can talk about the decrease in unemployment rate to 5.6% all he wants but the fact is that total labor participation rate is still just 66.1%, no higher than most of last year.  While 112,000 jobs were added, about 76,000 of it are in the retail industry.  Due to a weak retail holiday season late last year, not as much retail employment did not increase much late last year and as a result the increase in retail employement in January 2004 is artifical as less surplus retail employees are laid off.  Besides, most of these jobs are low paying service jobs and reflect the fact that the structural economic problems in the US economy are unresolved.  While these problems are not the result of the actions of the Bush administration, it has do nothing to solve them and in fact make them worse on the long run.  The fact is the Bush administration is the first administration to have a net negative change in employment since the Hoover administration.

     Credit to yourself for the consistency, but I think libertarians count as opponents to every President. I'll admit that I was being rather overbroad in my statement there.

[MalaspinaGold]

Inflation does not exist currently in the US. Pumping money into the economy does not necessarily result in higher prices.

[King]

Asset prices.

What assets exactly? Land values have not recovered to 2007 levels yet.

Only visible inflation anywhere since 2008 has been in meats, caused by drought-induced scarcity, and gasoline, caused by a spike in demand. There has been no evidence of currency inflation.

But the fact that you're now focusing on inflation and dropped the points on debt and government spending says a lot. You're talking out your arse. We're not worse off than in 1935, six years into the GD. The fact that we have such a great social net already in place has left us quite well off given the circumstances.

[MalaspinaGold]

Your data shows little to no upward movement in the inflation rate. Try again.

[King]

Your data shows little to no upward movement in the inflation rate. Try again.

I was gonna say... looks fine to me



And I'm tempted to call BS on ShadowStats magic inflation numbers. As a human who lived through 2009, where was inflation at 5%? I remember prices crashing down on everything from gas to food to stocks I owned.

That's anecdotal, but still. Any adjustment that says the sky was really green is hard to take seriously.

[Oakvale]

Your data shows little to no upward movement in the inflation rate. Try again.

Weren't you on the side of the people that said inflation was at 1-3%???


I could easily show the rise in prices if you would like

Please! (lol)

King's already touched on the vapidity of "uh, yeah, well, asset prices" excuse, but ~Magic secret inflation~ is the most tedious Zero Hedge garbage that's polluted internet 'discourse' on economics since the GFC. It usually ties in with the IMMINENT RECESSION announcement some blog spews out every couple of months based on a novel reading of statistical data. I'd greatly enjoy seeing how you'll "easily show the rise in prices".

[Tetro Kornbluth]

Wait, people are quoting ShadowStats as a serious source? That's even more ridiculous than unskewed polls.

As for Zero Hedge? This short video sums up my thoughts.

[King]

Your data shows little to no upward movement in the inflation rate. Try again.

Weren't you on the side of the people that said inflation was at 1-3%???


I could easily show the rise in prices if you would like

I'd like to see them.

Because, keep in mind, you don't have to just prove 5% inflation on certain markets in 2009. You actually have to prove inflation in certain markets so high that it actually cancelled out the collapse in home values, fuel prices, food prices, any consumer good related to demand, etc. in 2009 and left us with a 5% inflation rate overall.

Simply ridiculous. 5% in 2009... L. O. L.

[Person Man]

Inflation does not exist currently in the US. Pumping money into the economy does not necessarily result in higher prices.

Lol

How does inflation lead to higher prices if all the newly minted money goes into Mitt Romney's mattress.

[Deus Naturae]

Inflation does not exist currently in the US. Pumping money into the economy does not necessarily result in higher prices.

Lol

How does inflation lead to higher prices if all the newly minted money goes into Mitt Romney's mattress.

It doesn't, but the problem is that that money comes out of his mattress eventually.

[Comrade Funk]

How many gained jobs are minimum wage jobs?

[King]

Inflation does not exist currently in the US. Pumping money into the economy does not necessarily result in higher prices.

Lol

How does inflation lead to higher prices if all the newly minted money goes into Mitt Romney's mattress.

It doesn't, but the problem is that that money comes out of his mattress eventually.

But not all at once.

[RI]

The PCE deflator directly and quickly takes the substitution effect into account, and CPI does so indirectly and more slowly through intermittent re-weighting. As such, they measure "effective" inflation rather than "pure" inflation, and should by definition be lower than simply looking at individual goods. As the price of good A goes up, people substitute consumption of good B instead, meaning that as the price of good A rises even further, the effect of that price increase is felt increasingly less. People change their basket of goods being purchased continuously and the ratio of goods inside it; it makes little sense to keep a measure of inflation blind to this if you want to model what people face in their daily lives.

[King]

You must be logged in to read this quote.

Everything there is fluid in price (you'd get wildly different %s simply by switching the months in 2000 and 2014 being compared) or a luxury good like a new car.

More importantly, you are trying to prove inflation in the currency which a spike in oil and food from month to month does not indicate.

[jaichind]

Well, the frame of the time period gives a misleading view.  The fact is commodities as a whole in Jan 2000 was price lower than Jan 1990.  The best way is to look at something called Continuous Commodity Futures Price Index which is an equal-weighted geometric average of commodity price levels relative to the base year average price.  Jan 2000 value of this index was actually 27% lower than Jan 1980.  So Jan 2000 price levels reflected a prolonged period of price deflation.  Even if we took the Jan 1970 to Jan 2000 period which included large price increase of the 1970s the total rise during that period was 200% which works out to be 2.2% annually.

[RI]

http://www.washingtonpost.com/blogs/wonkblog/wp/2014/07/17/the-intellectual-cesspool-of-the-inflation-truthers/

[King]

http://www.washingtonpost.com/blogs/wonkblog/wp/2014/07/17/the-intellectual-cesspool-of-the-inflation-truthers/

Good read. I forgot about the Real GDP aspect. For secret inflation to be real, our economy would be in it's 26th consecutive year of 4+% shrinkage. We'd be living in post-apocalyptic times.

Instead we have the internet and smartphones.

[AggregateDemand]

Good read. I forgot about the Real GDP aspect. For secret inflation to be real, our economy would be in it's 26th consecutive year of 4+% shrinkage. We'd be living in post-apocalyptic times.

Instead we have the internet and smartphones.

The article is nothing more than modeling confirmation bias and nonsensical political rambling. Hyper-inflation has not occurred since QE; therefore, people feel at liberty to invent any number of stupid reasons as to why inflation didn't occur. This particular author argues that inflation didn't happen because inflation-truthers are inherently wrong. My mind was almost blown by the complexity of his inept ad hominem argument.

There is no denying the over-valuation of the US dollar. We've been printing money and running huge trade deficits for over a decade. Foreign-exchange reserves in China, Japan, and the EU are propping up the dollar, and the real inflation-truthers have been hawking gold quite successfully for over a decade.

We are walking the ridge of a roof. A rapidly expanding economy, may have catalyzed a clumsy sell-off of USD as central bankers moved to reduce foreign exchange exposure. Continued economic contraction during QE, might have facilitated a USD sell-off, which literally would have led to a new Weimar Republic in the US. I see no reason to criticize people who believed that our absurdly tepid economic recovery would have caused the latter to happen.

For the record, I believed Obama and Congress were not so inept as to cause Weimar 2.0, but their incompetence has caused me to question my position on several occasions. If the recovery continues at such a slow pace, we won't be out of the woods for another decade, either. We should not be celebrating.

[King]

Only problem with your theory is that you're wrong.

[jaichind]

As much as I am on the opposite camp of Krugman on so many things on the issue of inflation based on my personal experience is that the CPI is fairly accurate for me over the last decade and if anything overestimate inflation.  My unit consumer costs tend to match PCE more than CPI and PCE tends to be lower than CPI.  The reason why QE did not lead to large inflation is obvious to me.  The 2008 crisis lead to a lot of de-leveraging which had the effecting of lowering money supply which would have meant deflation.  QE which by itself would have led to inflation but these two affects seems to have canceled themselves out.  Once de-leveraging but QE continues then inflation would come back with a vengeance, in my view.

[AggregateDemand]

Only problem with your theory is that you're wrong.

Do you know anything about foreign exchange reserves and the currency rebalancing agreement that Greenspan/Bernanke forced with the People's Bank of China in 2005? If not, you really shouldn't be making comments.

If this recovery had been any more sluggish, ponderous or stagnant than it has been, or if the US had gone into an sharp double-dip, the possibility of USD sell-off would have been real. The situation was so dire from 2008-2010 that Democrats forced fracking through the EPA (harvesting black gold for the treasury) and Republicans happily endorsed CAFE regulations (reduce trade deficit). Of course, neither party stopped publicly criticizing either policy.

We've taken one step back from the edge of abyss. We are not remotely close to a functional economy at this point.

[Negusa Nagast 🚀]

I've become more convinced that AggregateDemand is simply a bot hooked up to a database of conservative buzzwords and talking points. This explains why it's impervious to facts and rational thought.

[AggregateDemand]

I've become more convinced that AggregateDemand is simply a bot hooked up to a database of conservative buzzwords and talking points. This explains why it's impervious to facts and rational thought.

GDP growth is lower than the marginal growth-rate of public debt. The most indebted generation in American history is on the hook for the biggest unfunded pension/healthcare liability in American history. There are reasons to be optimistic about the future, but if you don't understand the precariousness of our current situation, you need to pay attention.

People were complaining about the economy in 2006, during Bush's second term. We have 2% more unemployment and we've doubled the national debt, since then.