The big news that has somehow shocked the media is that the BLS was caught fudging the jobs numbers going into the 2012 election.
How on earth is this news? Anyone with a working frontal cortex is aware that CPI, the unemployment numbers, GDP and virtually everything else reported by the Federal Government is massaged to the point of being fraudulent.
Indeed, as far back as JULY 2013, the former head of the BLS stated point blank that real unemployment was around 10%
Keith Hall believes the US economy is a lot sicker than the 7.6 percent unemployment rate would lead you to believe.
And he should know.
Hall was, from 2008 until last year, the guy in charge of Washington’s Bureau of Labor Statistics, the agency that compiles that rate.
“Right now [it’s] misleadingly low,” says Hall, who believes a truer reading of those now wanting a job but without one to be more than 10 percent.
Source: NY Post
Then of course there is inflation. Anyone who actually shops for just about anything knows that prices are moving higher. Even if it’s not explicit (an actual price hike) we are paying higher prices through a slew of gimmicks corporations use to maintain margins in the face of rising costs.
Among these are:
1) Substituting lower quality ingredients (coffee makers)
2) Selling less product for the same price (across the board in food retail)
3) Simply not filling a box all the way (how many times have you opened something to find it’s just 75% full?)
This is how you hide inflation. Corporations don’t simply raise prices because of price elasticity.
And it’s not as though the BLS is even good at measuring inflation. The former head of the organization reveals that to measure CPI it performs hundreds of thousands of surveys to see what consumers are buying and how much they paid. Then the BLS sends people into stores to determine how much these items cost.
So the Feds are relying on people:
1) Remembering what they bought last month for groceries
2) Remembering the price they paid
Do you remember how much the cheese you bought last week was? Well your answer helps determine inflation… which helps determine Fed policy.
An economic model is only as good as the inputs. Suffice to say the inputs for most of the Fed’s economic model are of QUESTIONABLE value and that’s putting it mildly.
And the stock market is trading based on all of this?
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