Flash Update
FLASH UPDATE - Nov. 2, 2007
JOHN WILLIAMS' SHADOW GOVERNMENT STATISTICS
FLASH UPDATE
November 2, 2007
__________
Data Appear Massaged as Market Manipulation Tool
October Payrolls Fortuitously Show No Need for Further Easing
Household Employment Plunges by 250,000
__________
PLEASE NOTE: The SGS-Alternate Dollar Indices have been updated on the Alternate Data tab at www.shadowstats.com. Barring unusual developments, this morning's Flash Update is published in lieu of one this weekend.
-- Best wishes to all, John Williams
Further Nonsense in Key Data. The Bureau of Labor Statistics (BLS) reported today that the seasonally-adjusted October payroll employment rose by 166,000 (156,000 net of revisions) +/- 129,000, after September’s revised 96,000 (previously 110,000) gain. Year-to-year change for October was 1.18%, up a notch from September’s 1.17%, but down from 1.23% in August.
These numbers are no more believable than were the fudged GDP data, but they do happily confirm to the markets that the Fed does not need to ease again. In fact the Fed did not need to ease on Wednesday, but that would have savaged the stock market too much? In the current environment, key data continue to appear to be managed, as a tool for financial-market support operations.
The monthly bias factor was an add-on of 103,000, and the seasonal factors were altered, again. If the seasonally-adjusted and unadjusted growth rates were handled consistently, the October payroll change would been reported at 123,000.
The statistically-sounder household survey (number of people employed instead of the number of jobs), showed employment down by 250,000 jobs for the month, after gaining 463,000 jobs the month before. The seasonally-adjusted U.3 unemployment rate rose to 4.73% +/- 0.23% in October from 4.70% in September. Unadjusted U.3 eased to 4.4% in October from 4.5% in September, while the broader U.6 held at 8.4% adjusted, but eased to 7.9% from 8.0% unadjusted. Net of the discouraged workers defined out of existence during the Clinton Administration, actual unemployment holds around 12%.
Purchasing Managers Survey Shows Slowing Manufacturing, Rising Inflation. Moving in tandem with a deteriorating inflationary recession, the October purchasing managers manufacturing survey index (ISM) eased to 50.9 from 52.0 in September. As a diffusion index, a reading below 50 indicates a contraction. The October prices paid index, however, jumped to 63.0 from 59.0 in September. The new orders index eased to 52.5 from 53.4, while the employment index firmed slightly to 52.0 from 51.7.
Production, however, showed an outright contraction, plunging to 49.6 in October from 54.6 in September. Such should be something of a precursor to the behavior of the Fed's October industrial production measure.
October Dollar Indices at New Lows. The U.S. dollar's recent tumble took its toll on the monthly averages for the SGS Financial-Weighted Dollar and the Fed's Trade-Weighted Dollar, with both measures setting new historic lows. Both indices are set at January 1985 = 100.00.
The October FWD average was 47.43, down 2.39% for the month and down 9.85% year-to-year. The index reading at month-end also was a low, at 46.81.
The October TWD average was 53.20, down 2.61% for the month and down 10.23% year-to-year. Again the index reading at month-end was a new low, at 52.26.
Next Week. The September Trade deficit is the only major economic release due in the week, ahead on November 9th (Friday). Underlying fundamentals would suggest a significant deterioration, but intense pressures against the U.S. dollar favor ongoing massaged results, which apparently have become the norm in the last several months, bringing in consensus or better results.
Further detail will follow in the November SGS newsletter.
___________________________________________
The current target date for the posting of the November SGS is for late in the week of November 12th. An e-mail advice will be made of its and all intervening Flash Update/Alert postings.
FLASH UPDATE
November 2, 2007
__________
Data Appear Massaged as Market Manipulation Tool
October Payrolls Fortuitously Show No Need for Further Easing
Household Employment Plunges by 250,000
__________
PLEASE NOTE: The SGS-Alternate Dollar Indices have been updated on the Alternate Data tab at www.shadowstats.com. Barring unusual developments, this morning's Flash Update is published in lieu of one this weekend.
-- Best wishes to all, John Williams
Further Nonsense in Key Data. The Bureau of Labor Statistics (BLS) reported today that the seasonally-adjusted October payroll employment rose by 166,000 (156,000 net of revisions) +/- 129,000, after September’s revised 96,000 (previously 110,000) gain. Year-to-year change for October was 1.18%, up a notch from September’s 1.17%, but down from 1.23% in August.
These numbers are no more believable than were the fudged GDP data, but they do happily confirm to the markets that the Fed does not need to ease again. In fact the Fed did not need to ease on Wednesday, but that would have savaged the stock market too much? In the current environment, key data continue to appear to be managed, as a tool for financial-market support operations.
The monthly bias factor was an add-on of 103,000, and the seasonal factors were altered, again. If the seasonally-adjusted and unadjusted growth rates were handled consistently, the October payroll change would been reported at 123,000.
The statistically-sounder household survey (number of people employed instead of the number of jobs), showed employment down by 250,000 jobs for the month, after gaining 463,000 jobs the month before. The seasonally-adjusted U.3 unemployment rate rose to 4.73% +/- 0.23% in October from 4.70% in September. Unadjusted U.3 eased to 4.4% in October from 4.5% in September, while the broader U.6 held at 8.4% adjusted, but eased to 7.9% from 8.0% unadjusted. Net of the discouraged workers defined out of existence during the Clinton Administration, actual unemployment holds around 12%.
Purchasing Managers Survey Shows Slowing Manufacturing, Rising Inflation. Moving in tandem with a deteriorating inflationary recession, the October purchasing managers manufacturing survey index (ISM) eased to 50.9 from 52.0 in September. As a diffusion index, a reading below 50 indicates a contraction. The October prices paid index, however, jumped to 63.0 from 59.0 in September. The new orders index eased to 52.5 from 53.4, while the employment index firmed slightly to 52.0 from 51.7.
Production, however, showed an outright contraction, plunging to 49.6 in October from 54.6 in September. Such should be something of a precursor to the behavior of the Fed's October industrial production measure.
October Dollar Indices at New Lows. The U.S. dollar's recent tumble took its toll on the monthly averages for the SGS Financial-Weighted Dollar and the Fed's Trade-Weighted Dollar, with both measures setting new historic lows. Both indices are set at January 1985 = 100.00.
The October FWD average was 47.43, down 2.39% for the month and down 9.85% year-to-year. The index reading at month-end also was a low, at 46.81.
The October TWD average was 53.20, down 2.61% for the month and down 10.23% year-to-year. Again the index reading at month-end was a new low, at 52.26.
Next Week. The September Trade deficit is the only major economic release due in the week, ahead on November 9th (Friday). Underlying fundamentals would suggest a significant deterioration, but intense pressures against the U.S. dollar favor ongoing massaged results, which apparently have become the norm in the last several months, bringing in consensus or better results.
Further detail will follow in the November SGS newsletter.
The current target date for the posting of the November SGS is for late in the week of November 12th. An e-mail advice will be made of its and all intervening Flash Update/Alert postings.