John Williams points out on his Shadow Government Statistics website that modern economic reporting is distorted due to lack of data on “companies going out of business, a downturn so protracted that seasonal factors that have started to reflect economic contraction as a normal seasonal variation, and government statistical agencies that appear to be oblivious to the estimation problems. Include unusual features, such as one-in-three home sales being a foreclosure, the federal government taking effective control of some major auto makers, banks and the largest insurance company, and the chances that the traditional economic models will yield an accurate picture of current economic activity are nil.”
There is a built-in upside bias to the government’s numbers which started back in the 1980′s according to Williams. The birth-death model, for instance, assumes that jobs lost when companies go out of business “are more than offset by jobs created by start-up companies.” Start-up business job creation is estimated from data that is five years old when the boom was in full bloom.
{ 3 comments }
Go figure. A government number that is inaccurate… It’s almost too trite to comment.
The link:
http://www.shadowstats.com/
Ya got to pay to view any more than this though.
Central economic planners exhibit an impressive degree of doublethink. They are able to come up with the b.s. statistics and yet simultaneously believe in their veracity!
Comments on this entry are closed.