John
Williams'
Shadow Government Statistics
Analysis Behind and Beyond Government Economic Reporting
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Latest Commentaries Subscription required Subscription

Special Commentary: the year-end Special Commentary, scheduled for Monday, December 29th, will review developments of the year past and preview likely developments of the year ahead.  Regular Commentaries resume, on Wednesday, January 7th, covering the November trade deficit and construction spending, followed by one on Friday, January 9th, covering December employment and unemployment.  For further detail on pending economic releases, see the  schedule. (LAST UPDATED December 23rd)

No. 684: GDP Revision, November Durable Goods, New- and Existing-Home Sales Subscription required December 23rd, 2014
• Booming GDP - Strongest Growth in More than a Decade Is Nonsense • Magnitude of GDP Revisions Suggests Unstable Data and Unusual Internal-Reporting Issues at Bureau of Economic Analysis • Basic Durable Goods Orders Slowed Sharply in Third-Quarter 2014, On Track for Fourth-Quarter Contraction • Home Sales Also Showed Patterns of Stagnation and Renewed Downturn More ...
No. 683: November CPI, Real Retail Sales and Earnings Subscription required December 17th, 2014
• November Annual Inflation: 1.3% (CPI-U), 1.1% (CPI-W), 9.0% (ShadowStats) • Using Exaggerated Drop in Gasoline Prices, BLS Generated Headline CPI-U Monthly Decline of 0.3% (-0.3%), Instead of 0.2% (-0.2%) • Real Retail Sales Growth Was Distorted Heavily by Inconsistent Handling of Seasonal Adjustments for Gasoline Prices and Sales by BLS and Census Bureau • If Recent Retail Sales and CPI Reporting Are to Be Believed, Consumers Have Used the Bulk of Gasoline-Price Savings to Buy More Gasoline • Up for the Month, General Pattern of Headline Real Earnings Remained Stagnant • Unusual Economic Reporting in Week Ahead More ...
No. 682: November Housing Starts Subscription required December 16th, 2014

• Headline November Housing Starts Fell Month-to-Month and Year-to-Year Amidst Ongoing Unstable Revisions • Smoothed for Extreme Reporting Volatility, Aggregate Housing Starts Show Pattern of Plunge and Low-Level Stagnation, No Economic Recovery More ...
No. 681: November Industrial Production, Producer Price Index (PPI) Subscription required December 15th, 2014
• Scheduled for Second-Quarter 2015, Meaningful Benchmark Revisions to Industrial Production Could Be Unusually Large and to the Downside • November Industrial Production Jump Encompassed Utilities Surge, Widespread Manufacturing Gains, and Declining Oil and Gas Production • Utilities Output Spiked by Unseasonably-Cold Weather • Seasonal Adjustments and Revisions Remain Serious Issues • Significance of Headline Wholesale Inflation Is Muddled In Terms of Real-World Activity More ...
No. 680: November Retail Sales, Financial-Market Distortions Subscription required December 11th, 2014
• November Retail Sales Gain Boosted by Spurious Seasonal Adjustments,0.5% of 0.7% Headline Sales Gain Tied Just to Gasoline-Seasonality Issues • Irrational Markets Continue as Great Dollar Calamity Nears More ...
No. 679: Labor Numbers, Trade Deficit, Household Income and Construction Spending Subscription required December 6th, 2014
• Widening Fourth-Quarter Trade Deficit Should Hit GDP Growth Hard • October Median Household Income in Continued Low-Level Stagnation • Full-Time Employment Is 2.4 Million Shy of Pre-Recession Peak • Headline Unemployment Really Increased by 0.1%, But Gain Was Hidden in Rounding Details • November Payroll and Unemployment Data Heavily Skewed Again By Volatile and Inconsistent Seasonal Adjustments • November Unemployment Rates: 5.8% (U.3), 11.4% (U.6), 23.0% (ShadowStats) • Downtrend in Inflation-Adjusted Construction;Annual Growth Turned Negative in September and October • November Money Supply M3 Annual Growth Surged to Five-Year High More ...
No. 678: October Durable Goods Orders, New-Home Sales, November Consumer Conditions Subscription required November 26th, 2014
• No Economic Boom in Durable Goods Orders or Housing Activity • Real Durable Orders Goods Set Early Pace of Flat-to-Down Activity for Fourth-Quarter 2014 • New-Home Sales Revised Lower in Third-Quarter; October Broad Sales Activity Remained Stagnant • Consumer Confidence and Sentiment Remain at Levels Consistent with Historical Recessions More ...
No. 677: Third-Quarter 2014 GDP, First Revision Subscription required November 25th, 2014
• Gross Domestic Product Upside Revision Was Nonsense • Initial Gross Domestic Income Reporting Suggested Major Revision Shenanigans that Boosted Headline GDP • Underlying Reality Remains Down-Trending Stagnation in Broad Economic Activity More ...
No. 676: October CPI, Real Retail Sales and Earnings, Existing-Home Sales Subscription required November 20th, 2014
• October Annual Inflation: 1.7% (CPI-U), 1.5% (CPI-W), 9.4% (ShadowStats) • Inflation Held at 1.7% for Third Month, Despite Tumbling Oil Prices That Reduced CPI-U by 0.5% • Annual Real Retail Sales Growth Fell Back to Recession Level, Amidst Suggestions of Much-Slower Fourth-Quarter Activity • Third-Quarter GDP Headline Growth of 3.5% Should Revise to Below 2.5%; Fourth-Quarter GDP Activity Fair Bet for Outright Contraction • Existing-Home Sales Gained 1.5% for the Month, 2.5% Year-to-Year, But Fell 3.7% in the Trailing 12 Months of Activity More ...
No. 675: October Housing Starts, PPI Subscription required November 19th, 2014
• October Housing Starts Indicated Fourth-Quarter Contraction • PPI Headline Inflation of 0.2% Reflected Peculiarities of New Reporting Approach • October PPI Will Dampen Real Growth in New Orders for Durable Goods and Construction Spending More ...
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John Williams'
"Shadow Government Statistics"

johnwilliams@shadowstats.com
Tel: (415) 512-7701

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Some Biographical & Additional Background Information

Walter J. "John" Williams was born in 1949. He received an A.B. in Economics, cum laude, from Dartmouth College in 1971, and was awarded a M.B.A. from Dartmouth's Amos Tuck School of Business Administration in 1972, where he was named an Edward Tuck Scholar. During his career as a consulting economist, John has worked with individuals as well as Fortune 500 companies.

Although I am known formally as Walter J. Williams, my friends call me “John.” For 30 years, I have been a private consulting economist and, out of necessity, had to become a specialist in government economic reporting.

One of my early clients was a large manufacturer of commercial airplanes, who had developed an econometric model for predicting revenue passenger miles. The level of revenue passenger miles was their primary sales forecasting tool, and the model was heavily dependent on the GNP (now GDP) as reported by the Department of Commerce.  Suddenly, their model stopped working, and they asked me if I could fix it. I realized the GNP numbers were faulty, corrected them for my client (official reporting was similarly revised a couple of years later) and the model worked again, at least for a while, until GNP methodological changes eventually made the underlying data worthless.

That began a lengthy process of exploring the history and nature of economic reporting and in interviewing key people involved in the process from the early days of government reporting through the present. For a number of years I conducted surveys among business economists as to the quality of government statistics (the vast majority thought it was pretty bad), and my results led to front page stories in 1989 in the New York Times and Investors Daily (now Investors Business Daily), considerable coverage in the broadcast media and a joint meeting with representatives of all the government's statistical agencies.  

Nonetheless, the quality of government reporting has deteriorated sharply in the last couple of decades. Reporting problems have included methodological changes to economic reporting that have pushed headline economic and inflation results out of the realm of real-world or common experience.

Over the decades, well in excess of 1,000 presentations have been given on the economic outlook, or on approaches to analyzing economic data, to clients—large and small—including talks with members of the business, banking, government, press, academic, brokerage and investment communities. I also have provided testimony before Congress (details here).

An old friend—the late-Doug Gillespie—asked me some years back to write a series of articles on the quality of government statistics.  The response to those writings (the Primer Series available at the top-center of this page) was so strong that we started ShadowStats.com (Shadow Government Statistics) in 2004.  The newsletter is published as part of my economic consulting services. — John Williams

 


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