Archive for the ‘Economic indicators’ Category

More part-timers finding full-time jobs …

February 15, 2018

One of the benefits of the current low unemployment rate is that many people who were previously working part-time “for economic reasons” (i.e. had their hours reduced to part-time status or couldn’t find a full-time job) are now employed full-time.

By the numbers …

Approximately 127 million workers are now employed full-time …. that’s an all-time high … up 16 million from the financial crisis low point …  and up 5 million from the pre-crisis high.

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Here’s the interesting part …

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Based on Ken’s UEI (Ultimate Economic Indicator), maybe the economy is improving..

March 9, 2015

It has been 10 days since I placed a “free shipping” order with Amazon.

Why is that important”

There are a lot of indicators bandied about to ‘prove’ how well or poorly the economy is doing.

There’s GDP, unemployment, CPI, and many, many other metrics.

Sometimes they provide a consistent view of the economy … sometimes they contradict.

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Well, I’ve stumbled on the Ultimate Economic Indicator. An indisputable measure of economic activity …

(more…)

Nums: Why are economists so bad at forecasting?

February 10, 2015

Wash Post had an interesting analysis titled “This graph shows how bad the Fed is at predicting the future

The crux of their argument: the Fed has a clear recent tendency to mis-forecast economic growth … not by a little, by a lot …  forecasting almost twice as rapid growth as is ultimately realized.

For example,  in 2009 the Fed was predicting 4.2 percent growth in 2011.  But then in 2010 it revised that down to 3.85 percent growth. And in 2011 they revised it further to 2.8 percent growth. And when all was said and done, the economy only grew about 2.4 percent that year. The Fed projected growth almost twice as fast as what actually happened.

 

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What’s going on?

 

(more…)

The state of the economy in one killer chart …

December 17, 2014

This isn’t it !

This one was in the WSJ last week.

The accompanying narrative was something like “adding jobs – full-time, not part-time —  looking good”.

Earlier this week, we showed that the WSJ data is accurate, but it’s analysis is misleading because it starts analyzing from the depth of the recession (versus before the start of the recession) … and looks at raw numbers of jobs added (without normalizing for population growth).

Again, this isn’t the killer chart, I’m talking about.

 

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Rather, I’ve pulled together my earlier analysis into one simple chart that tells the story …

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The state of the economy in 2 charts …

October 8, 2014

Earlier this week, we looked at one of the no-BS economic measures: household income.

Adjusted for inflation, median household income dropped 8% during the recession … and has been flat after bottoming out a couple of years ago.

That means that the median real household income is still down 8% from the pre-recession peak.

 

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The drop in median household income has come despite a steady increase in average hourly wages … they’re up about 10% since the official end of the recession.

See Let’s celebrate the economy … err, let’s wait. for details

Here’s another no-BS indicator sent along by a loyal reader …

(more…)

Nums: Why are economists so bad at forecasting?

October 7, 2014

Wash Post had an interesting analysis titled “This graph shows how bad the Fed is at predicting the future

The crux of their argument: the Fed has a clear recent tendency to mis-forecast economic growth … not by a little, by a lot …  forecasting almost twice as rapid growth as is ultimately realized.

For example,  in 2009 the Fed was predicting 4.2 percent growth in 2011.  But then in 2010 it revised that down to 3.85 percent growth. And in 2011 they revised it further to 2.8 percent growth. And when all was said and done, the economy only grew about 2.4 percent that year. The Fed projected growth almost twice as fast as what actually happened.

 

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What’s going on?

 

(more…)

Boomerang Effect: Bending the cost curve … the wrong direction.

May 14, 2014

Two related articles caught my eye ….

First, Business Insider reported that “spending on healthcare grew an astounding 9.9% in Q1 … the biggest percent change in healthcare spending since 1980”

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The article goes on to say: “Analysts said it’s primarily due to a consumption boost from the implementation of the Affordable Care Act.”

That makes sense.

Some folks rushed to their docs in the last quarter of 2013 to beat the jump in their deductibles and to jump the line ahead those becoming newly insured.

Nonetheless, the fact remains that, adjusted for inflation, America is spending more on healthcare than ever before..

Here’s the big takeaway … (more…)

Boomerang Effect: Bending the cost curve … the wrong direction.

May 8, 2014

Two related articles caught my eye ….

First, Business Insider reported that “spending on healthcare grew an astounding 9.9% in Q1 … the biggest percent change in healthcare spending since 1980”

image

The article goes on to say: “Analysts said it’s primarily due to a consumption boost from the implementation of the Affordable Care Act.”

That makes sense.

Some folks rushed to their docs in the last quarter of 2013 to beat the jump in their deductibles and to jump the line ahead those becoming newly insured.

Nonetheless, the fact remains that, adjusted for inflation, America is spending more on healthcare than ever before..

Here’s the big takeaway … (more…)

Nums: Why’s the Fed so bad at forecasting?

April 18, 2014

Wash Post had an interesting analysis titled “This graph shows how bad the Fed is at predicting the future

The crux of their argument: the Fed has a clear recent tendency to mis-forecast economic growth … not by a little, by a lot …  forecasting almost twice as rapid growth as is ultimately realized.

For example,  in 2009 the Fed was predicting 4.2 percent growth in 2011.  But then in 2010 it revised that down to 3.85 percent growth. And in 2011 they revised it further to 2.8 percent growth. And when all was said and done, the economy only grew about 2.4 percent that year. The Fed projected growth almost twice as fast as what actually happened.

 

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What’s going on?

 

(more…)

Ken’s UEI (Ultimate Economic Indicator) … the real gauge of the economy.

July 15, 2013

There are a lot of indicators bandied about to ‘prove’ how well or poorly the economy is doing.

There’s GDP, unemployment, CPI, and many, many other metrics.

Sometimes they provide a consistent view of the economy … sometimes they contradict.

image

Well, I’ve stumbled on the Ultimate Economic Indicator. An indisputable measure of economic activity …

(more…)

Nums: Why’s the Fed so bad at forecasting?

June 24, 2013

Wash Post had an interesting analysis this week titled “This graph shows how bad the Fed is at predicting the future

The crux of their argument: the Fed has a clear recent tendency to mis-forecast economic growth … not by a little, by a lot …  forecasting almost twice as rapid growth as is ultimately realized.

For example,  in 2009 the Fed was predicting 4.2 percent growth in 2011.  But then in 2010 it revised that down to 3.85 percent growth. And in 2011 they revised it further to 2.8 percent growth. And when all was said and done, the economy only grew about 2.4 percent that year. The Fed projected growth almost twice as fast as what actually happened.

 

image

What’s going on?

 

(more…)

Basic Econ: Red beats Blue …

June 4, 2013

Last week, the American Legislative Exchange Council (ALEC) – a right-leaning economic analysis group – released its 6th annual report on state economic performance.

 

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= = = = =

The 10 states that had the best economic performance over the decade 2000 to 2010 were …

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Notice anything common across those states?

Here’s the code-breaker …

(more…)

Inflation is in check … oh, really.

March 15, 2012

Punch line: The Feds are reporting that inflation is in check at just over 3%.  An independent assessment puts the number over 8% … more credible given what’s been happening on supermarket shelves.

Excerpted from the NY Post

On the face of it, the government measure of consumer prices, the CPI, is just mildly alarming — with the government estimating prices to be rising at a 3.1 percent annual rate.

But as anyone who pays the bills or does the household grocery shopping knows, a government-reported 3.1 percent inflation rate is laughably low.

Bought cereal or mac and cheese for the kids lately? If so, you’re aware of the near double-digit increase in prices in the supermarket aisles.

So what is the true inflation rate?

The folks at the American Institute of Economic Research have resurrected the idea.

Their Everyday Price Index (EPI) strips away the cost of big-ticket items, like homes and cars, and looks at the cost of things that consumers encounter on a daily or monthly basis, such as groceries, prescription medicine, and telephone and cable bills.

By that measure, the Everyday Price Index shows inflation galloping ahead at an 8.1 percent annual rate.

Reference:  AIER Report

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“Nobody knew the economy was in such bad shape” … oh, yeah?

February 17, 2012

Soon after taking office, President Barack Obama crowed that  he’d cut the deficit in half by the end of his first term.

He made the pledge not as a candidate but as president.

It came in the East Room of the White House at the opening of his Fiscal Responsibility Summit on Feb. 23, 2009.

I want to be very clear: We cannot, and will not, sustain deficits like these without end.

Contrary to the prevailing wisdom in Washington these past few years, we cannot simply spend as we please and defer the consequences to the next budget, the next administration, or the next generation.

We are paying the price for these deficits right now.

In 2008 alone, we paid $250 billion in interest on our debt — one in every 10 taxpayer dollars. That is more than three times what we spent on education that year; more than seven times what we spent on VA health care.

So if we confront this crisis without also confronting the deficits that helped cause it, we risk sinking into another crisis down the road as our interest payments rise, our obligations come due, confidence in our economy erodes, and our children and our grandchildren are unable to pursue their dreams because they’re saddled with our debts.

And that’s why today I’m pledging to cut the deficit we inherited in half by the end of my first term in office.

Now, the President and his shills are hitting the talk shows asking for a pass on the pledge, saying that “nobody knew how deep the economic crisis was”.

Say, what?

Well, except for the Federal Reserve Board … as reported in their annual report … before Obama made the pledge.

click to see the whole report
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Here’s the essence of the report:

The unemployment rate has risen to its highest level since the early 1990s, and other measures of labor market conditions—for example, the number of persons working part-time because full-time jobs are not available—have worsened noticeably.

The deteriorating job market, along with the sizable losses of equity and housing wealth and the tightening of credit conditions, has depressed consumer sentiment and spending; these factors have also contributed to the continued steep decline in housing activity.

In addition, businesses have instituted widespread cutbacks in capital spending in response to the weakening outlook for sales and production as well as the difficult credit environment.

In all, real gross domestic product (GDP) in the United States dropped at an annual rate of 3-3⁄4 percent in the fourth quarter; real GDP seems headed for another considerable decrease  2009.

Hmmm.  Sounds like the Fed knew.

If you don’t like the Fed, see the Kiplinger Report “They Called It Right (Predictions for 2009)”

Here’s a sampling:

ROBERT SHILLER, professor at Yale University: ” The present situation has many similarities to the Great Depression.”

PETER SCHIFF, president of Euro Pacific Capital: “”We’re going to be in a depressionary environment. Our economy will be a mess for years and years to come. ”

NOURIEL ROUBINI, chairman of RGE Monitor and professor at New York University: ” I expect that the recession will be very severe and that it won’t be over before the end of 2009.”

BOB RODRIGUEZ & TOM ATTEBERRY, chief executive officer and partner, respectively, First Pacific Advisors: “Projections of economic growth have been far too optimistic. This is a multiple-year problem.”

DAVID TICE, chief equity strategist for , Federated Investors: “This will be a longer-term decline — you’ll see fits and starts …   it’s likely going to take four to five to ten years (to recover). 

Maybe Obama’s crack economic team didn’t know, but it looks like way more than “nobody”  knew.

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How many hours do you work each month … just to pay your mortgage or rent?

January 4, 2012

On average, the number is now over 100 – almost 3 weeks !

That’s up from 72 hours – about 2 weeks – back at the turn of the century.

Ouch.

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“The Toil Index …  portrays the most dramatic element of the middle-class squeeze — the effort required to rent a house served by a school of average quality. ” Robert Frank, New York University

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Source: Washington Post Chart 12

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