Yesterday morning, I had difficulty finding the BLS job revisions. So did everyone else. Eventually the BLS posted -818,000 but my unadjusted calc of -915,000 is accurate too.
Banks Obtained Crucial Jobs Data While Report Was Delayed
This is what happened yesterday: Bloomberg explains Banks Obtained Crucial Jobs Data While Report Was Delayed
At least three banks managed to obtain key payroll numbers Wednesday while the rest of Wall Street was kept waiting for a half-hour by a government delay that whipsawed markets and sowed confusion on trading desks.
After the Bureau of Labor Statistics failed to post its revisions to the monthly payroll figures at 10 a.m. New York time, Mizuho Financial Group Inc. and BNP Paribas SA both called the department and got the number directly. So did Nomura Holdings Inc.’s economic research team, according to a person familiar with the situation.
Anger quickly mounted as word spread across Wall Street that the BLS had begun giving out the numbers over the phone. A scramble ensued, with other firms and media outlets, including Bloomberg News, trying to obtain the figures, too.
When the data was finally released around 10:30 am, it showed payrolls will likely be revised down by 818,000 for the 12 months through March, the steepest markdown to the job numbers since 2009. Stocks initially jumped and bonds gained because the report lent support to speculation that the Federal Reserve will start cutting interest rates next month.
-818,000 or -915,000?
I could not find the data and did not understand where the heck everyone was getting -818,000 from.
So I did my own calculations from the data that I could find and arrived at -915,000.
Both numbers are correct. My post of -915,000 is the unadjusted number and -818,000 is the adjusted number.
You need to go to two different reports to find both sets of numbers and one was not there.
Wall Street Outraged
Zerohedge has a more colorful version of this story: Wall Street Outraged Over Latest Epic F*ck Up By Biden’s Labor Department
I had no idea where -818,000 came from so I did my own calculations.
Here is my post from yesterday: Was the Real Jobs Revision Negative 818,000 or Negative 915,000?
I listed 5 possibilities of what happened.
Five Possibilities
- The BLS created a seasonally-adjusted number and gave it to Bloomberg without publishing it.
- The BLS published 818,000 but where?
- Bloomberg made an estimate of the seasonally-adjusted number and reported it, without specifying it is their adjustment. Everyone copied the number without question.
- Bloomberg or whoever was first in reporting 818,000 made a bad calculation using a mix of seasonally-adjusted and unadjusted numbers.
- Something else, but what?
And the winner is ….. #1
Several banks, Zerohedge, and others got the number after calling in.
I gave up and did my own calculations, accurately but unadjusted, as I stated.
Eventually #2 came into play after I gave up looking for it.
OK, here’s the report.
CES Preliminary Benchmark Announcement
Please consider the CES Preliminary Benchmark Announcement
In accordance with usual practice [but not in the usual way], the Bureau of Labor Statistics (BLS) is announcing the preliminary estimate of the upcoming annual benchmark revision to the establishment survey employment series. The final benchmark revision will be issued in February 2025 with the publication of the January 2025 Employment Situation news release.
Each year, the Current Employment Statistics (CES) survey employment estimates are benchmarked to comprehensive counts of employment for the month of March. These counts are derived from state unemployment insurance (UI) tax records that nearly all employers are required to file. For National CES employment series, the annual benchmark revisions over the last 10 years have averaged plus or minus one-tenth of one percent of total nonfarm employment. The preliminary estimate of the benchmark revision indicates an adjustment to March 2024 total nonfarm employment of -818,000 (-0.5 percent).
Preliminary benchmark revisions are calculated only for the month of March 2024 for the major industry sectors. The existing employment series are not updated with the release of the preliminary benchmark estimate. The data for all CES series will be updated when the final benchmark revision is issued.
As is typically the case, many of the individual industry series show larger percentage revisions than the total nonfarm series, primarily because statistical sampling error is greater at more detailed levels than at an aggregated level.
Nothing Was Normal
A reader told me yesterday morning that a deviation of 0.5 percent is normal.
I replied that it isn’t. In fact, the deviation is 500 percent of normal. And if you look at private data, the deviation was 600 percent of normal.
Nothing about yesterday had anything to do with normal anywhere, in any way.
Regarding the Lead Chart
The two positive revisions are due to increased need for services due to millions of immigrants.
Government also tacked on 1,000 jobs but that revision is tiny. That’s one sector highly likely to be revised up.
Revisions When? How?
- The existing employment series [monthly reports] are not updated with the release of the preliminary benchmark estimate.
- The final benchmark revision will be issued in February 2025 with the publication of the January 2025 Employment Situation news release.
A Word About Bullsheet
In February of 2025, the BLS, in accordance with usual practice, will make revisions.
These revisions will not be monthly, or even quarterly.
It will be one big bang poof here you go update, with wild swings in the data. This will make all historical charts useless.
Thus, not only are the monthly job reports nothing but bullsheet, they will remain bullsheet even after the BLS posts revisions.
Don’t worry, there is nothing unusual about this. It happens every year.
But February of 2025 will be special because we will get 500 percent of the usual bullsheet, long after hardly anyone cares about how big the bullsheet was, and in a way that makes it difficult if not impossible to properly analyze for the few who do care.
Meanwhile, reporting of standard monthly bullsheet will proceed as normal, only to be revised later.
Any questions?
Improving the McKelvey Recession Indicator
I believe a recession has started.
2024 Q2 and 2024 Q3 numbers will be increasingly poor. There have been negative revisions in nearly all economic reports.
On August 20, I commented Improving the McKelvey Recession Indicator, No False Negative or Positive Signals
Adding the job vacancy rate to the McKelvey (Claudia Sahm) recession signal eliminates false negatives and false positives, and provides a much faster signal than Sahm.
Since 1953, every time the economy was in the current state, the economy was in recession.
That does not make the odds 100 percent because everything is up to the NBER, the official arbiter of recessions.
The NBER is very late in deciding. In one recession, the NBER posted the dates after the recession ended. So don’t expect timely confirmation.
My recession post is on the complicated side, but please check it out.
CFNAI out today:
https://www.chicagofed.org/research/data/cfnai/current-data
We are still at stall speed. This might be enough for the Fed to cut a quarter point in September.
BTW, look at the CFNAI Diffusion index since 2010. We are effectively in the same band again since 2016. Some may disagree but regardless of Covid, the economy was headed into a recession in 2020 based on this diffusion index. Covid just crashed the plane. The Fed clearly overdid it in 2020 and 2021 with rates that were too low for too long. As always they overcompensate too much in either direction and were the culprit for most of the inflation that is now subsiding. This time around they might think multiple rate cuts are needed but I think a quarter point a couple of times at most would suffice. The truth is the Fed, OCC and CFTC need to work together on the derivatives market. About 50% of commodity prices are still due to speculation and those not taking delivery of the end commodity. This has always been the unseen hand in the era of higher commodity prices since 2000 when derivatives were deregulated. That is more to blame for higher inflation since 2000 than anything else. It is hard to believe but in the mid 90s economic boom, oil and gas prices were 50% lower than what they have been on average since the 2001/2002 recession. Since derivatives exploded, the price of all commodities has been around 50% or more higher.
Clearly, this entire economic system is a gigantic Ponzi scheme. Corporations are scooping up assets while the dollar still appears to have buying power. What is happening to this country is reminiscent of Weimar Germany. Perhaps it is time to call your website the “Cassandra Report” from the Greek mythological priestess who always spoke the truth but was never believed by anyone. You are objective and correct Mike. Catharine Austin Fits believes this country suffered an economic coup d’etat in the mid nineties and I tend to believe her. It will all come crashing down with a mere few keystrokes…I pray I’m wrong.
I think the savings & loan scandal, tends to move that economic coup data earlier in the timeline. I would say it was started with Kennedy’s death in Dallas, clearly the economy has been hollowed out or looted, anyone who was alive then and now, understands we living in a different nation. Only the name remains.
Just a comment on market psychology.
Lot of financial press is driven by a need. That need comes from people who are living beyond their means. They perhaps bought a one bedroom, one bath condo in Manhattan for 1.4 mill. They have a large mortgage to make and they are long bonds.
They may have a trophy girlfriend or wife who also costs bucks to keep happy.
They have HOA fees. Taxes up the gazoo. Expensive restaurants they frequent. Night out on Broadway.
These people who keep calling for Fed to cut hard and fast have some serious Bias issues interfering with their analysis.
Lot of Wall Street fits this bill.
Fed will be following bonds when it comes to interest rates. They do not need to lead markets down by forcing lower interest rates.
Powell claims they are above Political influence. I have my doubts, yet still they can not act without justification.
This is like working for federal government and everyone in the agency says how they are underfunded and there is a need for more positions at higher levels due to the complexity and demands of the workspace.
Its organizational-level self promotion so there are more opportunities to get upgraded to GS 14 while still doing the same GS 13 job.
The sticky CPI, ex food and energy, is down from 6.5% to 4.1%. A farmer, who bought hundreds Damsel and Mountain Rouge tomatoes seeds, lost his crop. The Amish perfect tomatoes failed. Farmers complain about a bad year.The farmer market is 60% full. Bad is bad. The sticky CPI might popup.
Amish paste tomato rules.
Feed it in spring as it gets planted with composted cow manure.
Use 6″x 6″ grid concrete wire cage about 4ft. 6 inch tall, 30 inch to 36 inch diameter.
6×6 grid allows for a person to reach into cage for weeding and harvest.
Table tomato’s Black Krim,Patty’s yellow striped beefsteak, Madame Marmande
7 cages Amish paste easily put up 25 qts, sauce
2 cages for each table variety
Have all a family of five can eat and give away a bunch as well.
Just add Sun and water as needed. Keep the critters off them as every bird that flies or animal that walks wants a piece of your crop.
Zone 7 climate
Good job. I don’t always agree with you, but your work is difficult and appreciated. Thank you.
This is a test. Apparently when I post something it says I removed my own post myself.
The internet is a remarkably buggy environment to have sustained itself for a few decades, I think the Bots are holding everything together by now. If the Bots are unplugged, the whole thing collapses……
The delayed data release likely has more to do with the theme of the movie, “Don’t Look Up!” than any other explanation.
More likely DEI political appointees……..
Staggering Incompetence: Biden’s Commerce Secretary Is “Not Familiar” With The Bureau Of Labor
It’s so backwards that bad news drives markets up because people expect the Fed to lower interest rates and inflate the money supply. End the Fed
CPI and PCE may persist around 2.75% even with unemployment increasing. Not much incentive for the Fed to decrease the Fed Funds rate other than lower it from 5.5% to 5%.
The arbiter of recessions makes questionable start dates. To say that the expansion of the economy in Dec. 2007 marked the start of the recession is beyond my understanding.
Data shows we need to train more illegal aliens in professional and business services.
We’re definitely lagging in the donkey show industry.
Thank you ILLEGAL Immigration
Certainly looks like numbers under Trump were manipulated lower while under Biden higher. It is difficult to escape thinking that this was for political reasons and that Deep State process has been involved prior to Trump with such confidence that they believed they would get away with this. independent analysis by you and others have ferreted out this misconstruing of economic activity. You should also call it out as not an error as clearly errors are random while this shows extreme bias.
They sure as hell wouldn’t have released them right before the elections if that was indeed the case, the Kamala crew has got to be pretty freaking upset
Kamala has an impervious propaganda wing, that doesn’t allow reality to permeate within a 60 yard radius of their stalwart candidate. any negative can be blame on Joe, any positive on Kamala.
its amazing to see a women who couldn’t win a single state primary, being promoted as the Virgin Mary come to earth to rule benignly over America.
Negative revision during DMC can cost highly pd jobs. Kamala turned her back on
the Obamas and BLS. Trump was so please, he thinks that Obama is a nice gentleman. All he needs is a negative revision in the stock markets.
Gina Raimondo, Commerce Secretary, whose department includes BLS, is not familiar with that.
can’t find her fanny in the dark with both hands and a flashlight. but yeah put her in charge, what could possibly go wrong?????
Dr. Erika McEntarfer became the 16th Commissioner of Labor Statistics on January 29, 2024. She was nominated by President Joseph R. Biden on July 12, 2023, and confirmed by the U.S. Senate on January 11, 2024.
Dr. McEntarfer is a labor economist who has served over 20 years in federal government, with positions at the U.S. Census Bureau, the Executive Office of the President, and the Department of Treasury.
At the U.S. Census Bureau, she was the head of research for the Longitudinal Employer–Household Dynamics program, using linked employer–employee data to develop new labor market statistics and improve Census surveys and operations.
Prior to joining BLS, she was a senior economist at the White House Council of Economic Advisors, where she advised White House officials on the labor market recovery from the COVID-19 pandemic.
Nothing nefarious; doesn’t even mention any DEI or Vax status…
… saved for posterity:
https://web.archive.org/web/20240822144245/https://erikamcentarfer.net/wp-content/uploads/2023/11/cv-mcentarfer.pdf