Apr

11

Bill Rafter and I have discussed for years the steadily growing discontinuity in the BLS's employment data versus that implied by payroll tax receipts.

A few years ago the staff economists at the Atlanta Fed got so fed up with the nonsensical BEA GDP reports that they started issuing their own report anticipating the GDP release wit their GDPNow report.

Although the media has since glommed onto the report it is treated in similar fashion to the ADP employment release.

The differences between the two is important however.

The ADP report is distinct from the BLS data and uses inputs chosen by ADP.

The GDPNow report is designed to mirror the BEA's data inputs to anticipate not what what GDP is but what the BEA will report that it is.

The Atlanta Fed staff are putting the manipulators on notice, and those in the media and at the FOMC willing to go along with it, that there are consequences.

The actions by the Atlanta Fed staff have also helped to embolden other Fed staff members to do similar work and make it public.

The Richmond Fed staff economists have now produced a model of unemployment called the non-employment index that challenges the accuracy of the BLS data.

The importance of this is that it challenges the usefulness of the U3 unemployment rate and the FOMC natural rate of unemployment (NROU) predicated on it.

The point is that data is being willfully corrupted by providers and this has engendered, finally, a push back by others.

Being aware of the totality of this, especially for a group focused on clean data is important.


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