This morning, the Bureau of Labor Statistics of the Labor Department issued it’s January jobs report, claiming that the national unemployment rate fell from 9.4% to just 9.0%. Some 36,000 new jobs were created in January, well below the expected 145,000 predicted. So why did the unemployment rate fall? The BLS says that some 600,000 unemployed people have stopped looking for work. Not exactly a good sign of recovery. Nor was yesterday’s speech by Federal Reserve Chairman, Ben Bernanke at the National Press Club in Washington, DC. He claims that if Congress does not increase the nation’s debt ceiling, an ‘economic catastrophe’ may occur.
So the $64 Trillion dollar question is, are we in a recovery? Is the employment situation improving? Have we crossed the road and turned the corner? Plus, is our national debt crisis no big deal? Can we afford to add another $1.5 trillion or so to the government’s credit card?
The simple answer to all of the above is ‘NO!’. We have seen over these past two years how the BLS has been playing fast and loose with their numbers. If we look closely at Table A-1 of the BLS report (see link below), we see that by even their own numbers that the size of the ‘Civilian Labor Force’ has declined 500,000 in the past month, not increased! How can that be, given that our population increased?
In addition, the percentage ratio of employed Americans to overall population has increased only by 0.1% from 58.3% to 58.4%. So was there a mass die-off someplace I haven’t heard about? Maybe the BLS is including all those birds, fish and crabs that mysteriously kicked the bucket after New Year?
During last week’s economic conference at Davos, Switzerland, all the world’s big-wig brain-trust adopted an uneasy view after a chain of bad news. Japan had it’s bond rating knocked down a notch, highlighting their 20 straight years of morass and stagnation. The whole unrest in Egypt and other Arab nations was also unexpected bad news, fueling concerns about the future price of crude oil. Earlier this week, the actual cause of the unrest, world food prices, was defined in a new U.N. report showing that prices rose sharply by nearly 4% just since December, 2010.
Then we have Ben Bernanke still clinging to his quantitative easing, another reason for the inflation we see in essential commodities. The Federal Reserve cannot keep trashing our dollar like this for much longer. Nor can our government keep increasing the debt ceiling perpetually. Japan is an example of why that is. Since their mortgage bubble burst in the early 1990s, their government has continued to increase spending every single year while revenues have barely budged. No, the Labor Department’s January Jobs Report showing the unemployment rate falling to 9.0% is total hogwash. Just another example of Tom-Foolery from the Bureau of Labor Statistics in the Age of Obama-nomics.