Economic data should not be a matter of opinion.
Unfortunately, that’s what’s happening these days as not just data but even earnings and guidance flip flop and send stocks up and down 20% (sometimes in the same day) based on a single earnings report. A large part of this is due to the US’s Random Policy Generator where entire industries are propped up or gutted via tweets – or “truths” – we can’t even agree on what to call those things anymore!
Look at he GDP (and the interactive chart here is great), the Q1 forecast went from 2.7% in Jan to 5.7% just two weeks later to 3.7% on Tuesday. That’s not GDP Forecasting, that’s a ping-pong match!
Having reliable economic data is a CORNERSTONE to what makes the US a leading economy. We USED TO have accurate data but I guess randomly cutting Government Employees with decades of experience and gutting budgets and entire Agencies may NOT be the best way to run a country. Who’d have thunk it?
If you don’t know where you’ve been then you can’t know where you’re going (Heads!) and it’s up to the League of Incompetent Gentlemen to steer our $7,000,000,000,000 Government juggernaut in the right direction and, if we can’t agree on which way we’re heading or even what an iceberg looks like – it’s not likely to end very well, is it?
That’s right, if you are taking a journey from here to the UK (4,255 miles) and you are off by just 10%, you could end up in Norway or Italy or Spain or Germany. But yesterday, for example, the Average Hourly Earnings for December was revised down from 0.3% to 0.1% – 66% off!
That’s enough to strand you in Africa or the Arctic circle or even South America for that matter. Do you really think you can run a country with data that’s that poorly curated? And its not just the Government that needs that data to make $7Tn decisions – our Corporate Masters also rely on that data to make critical decision for the rest of our $30Tn (if you can believe that number) economy.
And it’s not just GDP (although GDP kind of includes everything) but look at Payroll Adjustments – which show that the TOTAL number of Jobs created under Trump last year was actually 85,000 – TOTAL!!! NOT 584,000 as claimed (still a shitty number). As with many Trump claims, it was inflated by 587%!
US Jobs data is NOT supposed to look like Russian Crop Reports!
The new data makes even more pronounced the “low hire, low fire” stasis that has characterized the labor market for much of the past two years. The revisions didn’t affect the unemployment rate, which ticked down to 4.3 percent in January. But they suggest that job growth ground nearly to a halt last year, making it hard for anyone without a job to find one.
And Health Care accounted for 405,000 new jobs! Apparently our aging population is driving more hiring than all of AI… THIS is why Consumer Sentiment and Consumer Confidence are at all-time lows – even with these “positive” (until adjusted) jobs numbers. And remember what I said about policy mistakes – the Fed relies on “positive” jobs data to hold rates steady when, in fact, we’re in a jobs crisis and have been for an entire year…
Staffing cuts (more unemployment) at the USDA has just (2 days ago) led to a MAJOR revision in crop data. That is our FOOD SUPPLY they are messing with and Trump has also cut the crap out of the National Weather Service so farmers are forced to resort to “Poor Richard’s Almanac” to optimize their planting schedule. Was America really that GREAT (again) in the 1800s that we are trying to revert back to a pre-industrial age?
Thousands of employees left USDA last year as part of President Donald Trump’s drive to shrink the federal government, and experts worry the shrinking staff hobbled the agency’s ability to produce accurate and timely data. At the Farm Service Agency, another USDA branch, staffing reductions hampered employees from processing data on plantings last summer and feeding it to the statistics service, said Spiro Stefanou, a former acting USDA deputy undersecretary who resigned last fall. This delayed the statistics service from receiving a complete picture of acreage. “NASS had less information to go on,” Stefanou said. “That was going to make their estimates less reliable.”
Last summer, Trump fired a top Labor Department official following a weak scorecard of the U.S. job market, stoking other concerns about the quality of Federal Government Data. As for the crops: “A swing of this size from June to final plantings has never happened before, making many feel it is more difficult to adequately manage risk.“
We are INVESTORS! If you don’t care about Climate Change or Air Pollution or Political Appointments or Pressure from the White House to fake Data or whether Trump is mentioned 34,000 times or 1,000,000 times in the Epstein files – you SHOULD care about the fact that RISK cannot be accurately measured in your portfolio – at least a little!
We NEED reliable data for the markets to function and the bad data today (like Tesla’s fake earnings and 60% exaggerated GDP numbers), leads to companies like STLA drastically overestimating how much they should spend on EVs, which just led to a $22Bn write-down for the company.
That $22Bn was a mis-allocation of capital that could have been put towards a productive use – one that might have created REAL JOBS for American workers. Instead, the capital went up in smoke – down the black, black hole of bad data…
