USA 2020 Elections: Thread

[grarpamp]

No higher pinnacle of corruption sought than US Govt and Democrats...

Pay to corrupt, including SBF's $50+M, and Soros's $150+M...

https://www.opensecrets.org/

Biden politically stealing the SPR to lower gas prices for election wins...

SPR @ 382/714MBbl -11 avgLast3Mo  a/o Dec 9  Negligible days buffer remaining

The US Govt cooks it's own Inflation Books, lying to the people
for Political Gain...

https://shadowstats.com/

The US Govt Politicians hide and never discuss the debt slavery
they saddled upon the people's backs...

https://www.usdebtclock.org/


Biden is now cooking the employment books for Political Gain too...



Here Comes The Job Shock: Philadelphia Fed Admits US Jobs "Overstated"
By At Least 1.1 Million

https://www.philadelphiafed.org/surveys-and-data/regional-economic-analysis/early-benchmark-revisions

Regular readers are well aware that back in July, Zero Hedge first
(long before it became a running theme among so-called "macro
experts") pointed out that a gaping 1+ million job differential had
opened up between the closely-watched and market-impacting, if easily
gamed and manipulated, Establishment Survey and the far more accurate
if volatile, Household Survey - the two core components of the monthly
non-farm payrolls report.

We first described this divergence in early July, when looking at the
June payrolls data, we found that the gap between the Housing and
Establishment Surveys had blown out to 1.5 million starting in March
when "something snapped." We described this in "Something Snaps In The
US Labor Market: Full, Part-Time Workers Plunge As Multiple Jobholders
Soar."

Since then the difference only got worse, and culminated earlier this
month when the gap between the Establishment and Household surveys for
the November dataset nearly doubled to a whopping 2.7 million jobs, a
bifurcation which we described in "Something Is Rigged: Unexplained,
Record 2.7 Million Jobs Gap Emerges In Broken Payrolls Report."

Whether this divergence was due to wrong seasonal adjustments (a
remnant of the overreaction taken by the Dept of Labor following the
covid crunch to normalize for a new normal labor market), due to
erroneous Birth-Death assumptions (here too, the Dept of Labor was
assuming early cycle new business creation which clearly is wrong with
the economy late cycle and millions of businesses shutting down,
ignoring the open PPP fraud that took place in early/mid-2000s as
everyone "opened up" businesses to get free money from the
government), due to the Establishment Survey inability to tell the
difference between full, part and multiple-jobs - as a reminder we
first showed that since March, the US had lost 400K full-time jobs
offset by far lower paying part-time jobs as well as double-counted
multiple jobholders...

... due to the record high rate of estimation - recall the 49%
Establishment survey response rate was much lower than the 70-75% rate
typical in November, meaning the Dept of Labor was literally making
numbers up to "complete" the survey...

... or some other reason, perhaps including the Biden admin tapping
certain Bureau of Labor Statistics officials on the shoulder and
advising them to show strong numbers if they want to keep their...
well... jobs, we did not know, but we did know that according to the
Household Survey, just 12,000 jobs were created since March, while
according to the Establishment Survey - which moves markets and sets
Fed policy - the increase in jobs over the same period was 2.692
million!

We bring all this up again because late on Dec 13, the Philadelphia
Fed published something shocking: as part of the regional Fed's
quarterly reassessment of payrolls in the form of an "early benchmark
revision of state payroll employment", the Philly Fed confirmed what
we have been saying since July, namely that US payrolls are overstated
by at least 1.1 million, and likely much more!

First, some background.

As the Philly Fed notes, "estimates by the Federal Reserve Bank of
Philadelphia indicate that the employment changes from March through
June 2022 were significantly different in 33 states and the District
of Columbia compared with current state estimates from the Bureau of
Labor Statistics’ (BLS) Current Employment Statistics (CES). Early
benchmark estimates indicated higher changes in four states, lower
changes in 29 states and the District of Columbia, and lesser changes
in the remaining 17 states.

Wait, the Philly Fed tabulates jobs? Isn't that the jobs of the BLS?

Why yes, the BLS does that every month. The problem is that to
successfully publish a report within days after any given month ends,
the BLS report gives up in accuracy what it makes up in speed. Far
more accurate reports are available elsewhere, they just come with a
big lag. This is where the Philadelphia Fed comes in: from the latest
quarterly report...

    Our estimates incorporate more comprehensive, accurate job
estimates released by the BLS as part of its Quarterly Census of
Employment and Wages (QCEW) program to augment the sample data from
the BLS’s CES that are issued monthly on a timely basis. All
percentage change calculations are expressed as annualized rates. Read
more about our methodology. Learn more about interpreting our early
benchmark estimates.

Ok, ok, what did this "more accurate", "more comprehensive" report
find? It found that...

    In the aggregate, 10,500 net new jobs were added during the period
rather than the 1,121,500 jobs estimated by the sum of the states; the
U.S. CES estimated net growth of 1,047,000 jobs for the period.

Remember what we said in July when we first looked at the March-June
divergence between the Household and Establishment survey: we said
that "since March, the Establishment Survey shows a gain of 1.124
million jobs while the Household Survey shows an employment loss of
347K!" Said otherwise, we found that payrolls "calculated" by the
Establishment Survey were overestimated by 1.5 million. Shockingly,
the Philly Fed seems to agree, and reports that instead of the roughly
1.1 million jobs reported by the BLS, only 10,500 new jobs were added!

And some more data:

    Payroll jobs in the nation remained essentially flat from March
through June 2022 after adjusting for QCEW data:

        Less than the 3.0 percent growth indicated by the sum of the states
        Less than the 2.8 percent growth indicated by the U.S. CES estimates

This is shown graphically in the chart below: specifically, the
analysis looks at the quarter in the red box, where the green line, or
the more accurate "early benchmark" revision of official data, dipped
decidedly below the CES trendline (i.e., the nonfarm payrolls).

For those who are too lazy to click on the source report, here is the
summary page:

Of course, the above analysis only looks at the March-June period.
What about subsequent months and quarters? Well, we will have to wait
at least 3 months to get the June-Sept data, but using the same
approach which we now know works, and which looks at the divergence
between Household and Establishment surveys, it is safe to say that
the job "overstating" which was 1.5 million in June according to Zero
Hedge and 1.1 million according to the Philly Fed, has almost doubled
to 2.7 million from March to November. The only question is what the
final, far more accurate Philly Fed estimate will be when it is
published some time in 6 months time.

But an even bigger question is when does the BLS realize (or rather
admit) what is going on and engages in a shotgun backward revision of
data? The most likely answer is that the BLS will simply wait until
one of its annual historical data revision periods, when the Bureau of
Labor Statistics quietly admits that historical data was higher by a
few million, and re-benchmarks current months going forward as if
nothing had happened. In the meantime, however, the Fed is shaping
monetary policy using the clearly flawed assumption that the US labor
market is "hot", "tight" and "strong", when in reality we now know
that between March and June, monthly payrolls were overstated by about
350,000. This matters because this is what the BLS reported for
payrolls for those months:

    April 368K
    May 386K
    June 293K

Now take those numbers and adjust them to subtract an average of 350K
from each month (to get the revised Philly Fed payroll over this
period) and you get this:

    April 18K
    May 36K
    June 57K

And visually.

Still think the Fed would be hiking 75bps this summer if instead of an
average monthly job gain of 350K, Powell was seeing zero monthly
payroll increases?

And even more importantly, now that the cat is out of the bag and the
Philly Fed has introduced this huge credibility issue in all recent
payrolls data, how long until this becomes a political issue, and how
long until Republicans - who take control of the House in January -
start hearings to demonstrate to the US that the collapse in the labor
market did not start with the Republican takeover but was well in
place last summer.

And finally, how long until the Fed - which made it clear that it is
no longer focused purely on inflation numbers (which are sliding fast
anyway) but will also be looking at clearly wrong jobs data - makes it
a point that the US labor market is in far worse shape, it is in fact
contracting, than it was when it decided to hike 75bps several times
in a row?