While the media has been cheerleading the recovery and posting headlines about the unemployment numbers, they haven't been as vociferously posting the macroeconomic data. Whenever the mainstream media endlessly harps on one story, it's a good bet that they're trying to distract you from the real story somewhere else. In this case, it would be the terrible macroeconomic data that's been coming in since the end of QE3.
In fact, since February alone we've seen 48 data misses and only 8 beats. Let that sink in for a minute. That's not even close. And much of that negative data is the kind of misses or month after month negativity that is only seen during recessions, yet the stock market ignores that bad news and only seems focused on the employment numbers.
Labor force participation rate is at historic lows. Defenders of the government numbers will argue that it's because of all the Baby Boomers retiring, but there are plenty of people who have pointed out that "... the participation rate for those 55 and older is as high as it has ever been historically. The participation rate, unfortunately, for those in the 25 - 34 demo, that’s 4% lower than before the crisis." Recent college grads and highschoolers looking for their first jobs are still struggling to find work. Meanwhile, Boomers are finding that they can't retire and have to stay in the workforce for longer than anticipated.
Meanwhile, we still have a record number of people on food stamps. A robust recovery would see record low numbers of people needing assistance, not record highs.
Yet another reason to doubt the BS coming out of the BLS has to do with the huge discrepancy in estimated job losses in the energy sector. According to last month's BLS report, only 1,100 energy sector jobs were lost in February. However, Challenger, Gray & Christmas, a notable Chicago-based firm that specializes in outplacements, downsizings, and plant closures, claims there were 16,000 energy jobs lost in February. Sixteen thousand. That's a huge discrepancy. With the months long tumble that oil prices have taken and a recovery in prices far from sight, which number do you think is more believable?
Paul Craig Roberts, former Assistant Secretary for the Treasury under Reagan, also threw cold water on the latest jobs numbers. Here's his assessment:
"The 295,000 claimed new jobs are highly suspect. For example, the report claims 32,000 new retail jobs, but the Census Bureau reports that retail sales declined in December and January. Why would retailers experiencing declining sales hire more employees?
Construction spending declined 1.1% in January, but the payroll jobs report says 29,000 construction jobs were added in February.
Zero Hedge reports that the decline in the oil price has resulted in almost 40,000 laid off workers during January and February, but the payroll jobs report only finds 2,900 lost jobs in oil for the two months."Something isn't adding up. Noted economist Peter Schiff, who was out there early and often warning about the 2008 housing bubble, has been documenting weekly (his podcast on the latest jobs report is here) the lack of recovery we're seeing and predicting an even bigger crash in the near future than the one we've supposedly just recovered from. Why another crash? Because the Federal Reserve hasn't reversed course on anything and instead is doubling (tripling?) down on the same failed policies that crashed the economy in 2001 and 2008. But you can only reinflate the bubble so many times before it ultimately pops for good.
Sorry, folks, but you can't print your way to prosperity, which is essentially what the Federal Reserve has been trying to do since the inception of its quantitative easing programs. Only a gang of economists (or Congressmen) would think that piling debt on top of debt, borrowing trillions of dollars, and printing an endless stream of money won't end badly some day. They're just hoping it doesn't happen on their watch, like a game of hot potato and hoping they're not the ones caught holding the potato when the music stops.
For a further explanation of why what the Federal Reserve is engaging in will only lead to further pain down the road, I refer you to this short video of historian and Austrian economist (Austrian as in the Austrian school, not Austrian in nationality), Tom Woods, discussing how Austrian business cycle theory explains these economic booms and busts that everyone else, including and especially those at the Federal Reserve, seem to think just come from out of nowhere.
I'm not an economist but I've been doing a lot of self-study in economics over the last few years. As a former liberal, I realized how woefully uninformed about economics I was previously, which of course explains why I was a liberal. Perhaps I'm wrong and I'm subscribing to the wrong economic theory. But no matter which way you slice it, we're $18 trillion dollars in debt, that's $18,000 billion dollars to put it in different terms (by comparison, Warren Buffet, one of the world's richest men, is only worth $76 billion dollars), with no sign of slowing down.
We have placed the central planners at the central banks on pedestals, almost revering them as deities, and allowed them to perform experiments with unfathomable sums of money, usually in secret because we can't fully audit their books, and think that this small group of humans somehow has enough accumulated knowledge amongst them to make fiscal and monetary decisions for the other 310 million of us. If that seems absurd that's probably because it is. Along the way, your government has been lying to you about the real state of the economy leading people to believe in a recovery that wasn't real.
I hope I'm wrong but anyone with a wit of common sense can see that something ain't right, no fancy economics degree required (probably better that way as those with the degrees are the ones most blind to the realities of the situation!). I suspect in a matter of years, or sooner, we'll know one way or another. Maybe by then you'll be able to throw this blog in my face and I'll humbly eat crow. If not, watch out below!
