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Staring Armageddon In The Face But Hiding It With Official Lies

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Source: Paul Craig Roberts



According to the Bureau of Labor Statistics, the US economy created 236,000 new jobs in February. If you believe that, I have a bridge in Brooklyn that I'll let you have at a good price.

Where are these alleged jobs? The BLS says 48,000 were created in construction. That is possible, considering that revenue-starved real estate developers are misreading the housing situation.

Then there are 23,700 new jobs in retail trade, which is hard to believe considering the absence of consumer income growth and the empty parking lots at shopping malls.

The real puzzle is 20,800 jobs in motion-picture and sound-recording industries. This is the first time in the years that I have been following the jobs reports that there has been enough employment for me to even notice this category.

The BLS lists 10,900 jobs in accounting and bookkeeping, which, as it is approaching income tax time, is probably correct; 21,000 jobs in temporary help and business support services; 39,000 jobs in health care and social assistance; and 18,800 jobs in the old standby -- waitresses and bartenders.

That leaves about 50,000 jobs sprinkled around the various categories, but not in numbers large enough to notice.

The presstitute media attributed the drop in the headline unemployment rate (U3) to 7.7% from 7.9% to the happy jobs report. But Rex Nutting at Market Watch says that the unemployment rate fell because 130,000 unemployed people who have been unable to find a job and became discouraged were dropped out of the U3 measure of unemployment. The official U6 measure which counts some discouraged workers shows an unemployment rate of 14.3%. Statistician John Williams' measure, which counts all discouraged workers (people who have ceased looking for a job), is 23%.

In other words, the real rate of unemployment is 2 to 3 times the reported rate.

Nutting believes that the U3 unemployment rate has become too politicized to have any meaning. He suggests using instead the work force participation rate. This rate is falling substantially, reflecting the discouragement that occurs from inability to find jobs.

John Williams (shadowstats.com) says that distortions in seasonal factor adjustments overstate monthly payroll employment by about 100,000 jobs. The jobs data that is not seasonally adjusted shows about 1.5 million fewer jobs in the economy.

In a recent communication, statistician John Williams (shadowstats.com) reports that the rigged official annual rate of consumer inflation (CPI) of 1.6% is in fact, as measured by the official US government methodology of 1990, 9.2%. In other words, the rate of inflation is 5.75 times greater than the reported rate. If Williams is correct, the interest rate on bonds is extremely negative.

Over the years the official measure of inflation has been altered in two ways. One is the introduction of substitution for what formerly was a constant weighted basket of goods. In the former measure, if a price of an item in the basket (index) rose, the CPI rose by the weight of that item in the basket.

In the substitution-based measure, if a price of an item in the basket goes up, the item is removed from the basket, and a cheaper item is put in its place. For example, if the price of New York strip steak rises, the new CPI will substitute the price of a cheaper cut.

In this new measure, inflation is held down by measuring not a fixed standard of living but a declining standard of living.

The other adjustment used to restrain the measure of inflation is to re-classify many price rises as "quality improvements." Price rises declared to be quality improvements do not translate into a higher measure of inflation. In other words, if a product rises in price, the price increase or some portion of it can be assigned to improved quality, not to a rise in component or energy costs. As the incentive is to hold down the inflation measure in order to save money for the government on Social Security cost-of-living-adjustments, quality improvements are over-estimated.

Consumers have to pay the higher prices, and as incomes, except for the 1 percent, are not growing, higher product prices, regardless of whether they are or are not quality improvements, mean a lower standard of living for the 99 percent.

The understated new measure of inflation allows the government to show real GDP growth and thus the end of the December 2007 recession, and it allows the government to show in the latest report real retail sales again matching the pre-recession level. However, when measured correctly, as by statistician John Williams, the true picture of retail sales shows a steep decline from 2007 through 2009 and bottom bouncing since.

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http://www.paulcraigroberts.org/

Dr. Roberts was Assistant Secretary of the US Treasury for Economic Policy in the Reagan Administration. He was associate editor and columnist with the Wall Street Journal, columnist for Business Week and the Scripps Howard News Service. He is a contributing editor to Gerald Celente's Trends Journal. He has had numerous university appointments. His book, The Failure of Laissez Faire Capitalism and Economic Dissolution of the West is available here. His latest book,  How America Was Lost, has just been released and can be ordered here.

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We, the peons, are SO screwed in this country. WAL... by 911TRUTH on Monday, Mar 11, 2013 at 12:54:03 AM
*If you know some of your history, then you will a... by Deborah Dills on Monday, Mar 11, 2013 at 11:23:40 PM
I'm not saying that's not true, but there is no li... by Scott Baker on Monday, Mar 11, 2013 at 1:32:58 AM
Seem like the only way to help Fund Public State B... by Michael Dewey on Tuesday, Mar 12, 2013 at 1:49:11 PM
There's hundreds of billions, over a trillion, rea... by Scott Baker on Tuesday, Mar 12, 2013 at 3:43:17 PM
IS the PLAN.   Once the next big crash hits A... by Poor old Dirt farmer on Monday, Mar 11, 2013 at 10:52:42 AM
Great info on why the Fed/banks are suppressing th... by Ernie Messerschmidt on Monday, Mar 11, 2013 at 12:44:31 PM
hopefully a link that works... by Ernie Messerschmidt on Monday, Mar 11, 2013 at 12:51:46 PM
here... by Ernie Messerschmidt on Monday, Mar 11, 2013 at 12:56:48 PM
Ben will print and charge interest (usury charge) ... by Lance Ciepiela on Monday, Mar 11, 2013 at 3:18:52 PM
The 100 year Federal Reserve charter is up for ren... by Poor old Dirt farmer on Monday, Mar 11, 2013 at 4:53:51 PM
No way will the banking and financial community al... by Toby Seiler on Monday, Mar 11, 2013 at 5:56:17 PM
I really hate it when I write a post and have not ... by Toby Seiler on Monday, Mar 11, 2013 at 5:41:42 PM
Paul CR, you should look into a similar situation ... by Toby Seiler on Monday, Mar 11, 2013 at 6:22:31 PM
 i would guess-  PCR also had published&... by Mark Sashine on Tuesday, Mar 12, 2013 at 9:36:30 AM
As I said many times, unleash democracy power. See... by Gary Brumback on Tuesday, Mar 19, 2013 at 7:22:44 AM
The presstitute media attributed the drop in the h... by Michael Dewey on Tuesday, Mar 12, 2013 at 1:50:57 PM
Here are my answers to what the lilkihood of these... by Gary Brumback on Tuesday, Mar 19, 2013 at 6:59:41 AM