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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: orkrious who wrote (25009)	3/6/2005 8:09:46 PM
From: mishedlo	Read Replies (1) \| Respond to of 116555

I do not believe that is an accurate way to look at it. Last month he said the reverse. "Given that 280K jobs were subtracted the headline number was stronger than expected" or something to that affect if I recall correctly. Personally I do not think either number was worth crowing about but the way he describes it, it almost seems that huge negative numbers are going to cause a positive affect when they occur and a negative one the next month. More to the point, the BLS did not add 380,000 jobs they added 100,000 jobs. Each total is independent. ie If they subtract 100,000 jobs next month it will not be a 200,000 subtraction. here is another one: we went from positive 66 to -280 dec to jan. Was that a subtraction of 346K workers? I think not. here are frequently asked questions. bls.gov Q: Do the birth/death factors vary from first preliminary to final estimate? A: The birth/death factor for a given month does not change between 1st preliminary, 2nd preliminary, and final estimates. Q: Are birth/death factors seasonally adjusted? A: No, they are calculated using population data that is not seasonally adjusted and the factors are applied to the sample-based not seasonally adjusted data. Months with generally strong seasonal increases such as April, May and June generally have a relatively large positive factor. Conversely, months with overall strong seasonal decreases, such as January, generally have a relatively large negative factor. Q: Can I subtract the birth/death adjustment from the seasonally adjusted over-the-month change to determine what it is adding to employment? A: No. Birth/death factors are a component of the not seasonally adjusted estimate and therefore are not directly comparable to the seasonally adjusted monthly changes. Instead, the birth/death factor should be assessed in the context of its effect on the not seasonally adjusted estimate. Q: Can BLS provide an estimate of the contribution of the birth/death adjustment to the seasonally adjusted monthly payroll change? Can BLS independently seasonally adjust the net birth/death component? A: There is not an estimate of the seasonally adjusted contribution of the birth/death model. The sample collected on a monthly basis, the imputation of business births using deaths, and the net birth/death model are all necessary components for obtaining an accurate estimate. The components are not seasonally adjusted separately because they do not have particular economic meaning in and of themselves. Q: Is birth/death ever benchmarked to actual data, or is just the overall estimate benchmarked? A: No, the birth/death factors are not independently benchmarked. Although more recent data are available, birth/death factors are not benchmarked or recalculated in the benchmarking of the CES estimates. Only the estimates are benchmarked. ======================== Seems to me that are making this as complicated as possible. normal totals are seasonally adjusted but the B/D factor is not. It just gives someone all the more room to screw with the numbers as they see fit. here are some interesting graphs. Looks like fodder for Calculated Risk. ggg bls.gov bls.gov Now since 100K non-seasonal Jobs were added by the model between Jan and Feb and given that the months were 130,474 and 131,330 respectively, we did appear to gain alot of jobs with or without the adjustment. The headline number is based on adjusted, the secondary number is based unadjusted. What a mess M