Thread: Wall Street adviser: Actual unemployment is 37.2%, 'misery index' worst in 40 years

Wall Street adviser: Actual unemployment is 37.2%, 'misery index' worst in 40 years

By Paul Bedard | JANUARY 21, 2014 AT 1:08 PM
Topics: Washington Secrets Jobs Treasury Economy Federal Reserve Inflation Wall Street Unemployment

40 years ago, former President Ford issued "WIN" buttons, short for "Whip Inflation Now." The...

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Don't believe the happy talk coming out of the White House, Federal Reserve and Treasury Department when it comes to the real unemployment rate and the true “Misery Index.” Because, according to an influential Wall Street advisor, the figures are a fraud.
In a memo to clients provided to Secrets, David John Marotta calculates the actual unemployment rate of those not working at a sky-high 37.2 percent, not the 6.7 percent advertised by the Fed, and the Misery Index at over 14, not the 8 claimed by the government.
Marotta, who recently advised those worried about an imploding economy to get a gun, said that the government isn't being honest in how it calculates those out of the workforce or inflation, the two numbers used to get the Misery Index figure.
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“The unemployment rate only describes people who are currently working or looking for work,” he said. That leaves out a ton more.
“Unemployment in its truest definition, meaning the portion of people who do not have any job, is 37.2 percent. This number obviously includes some people who are not or never plan to seek employment. But it does describe how many people are not able to, do not want to or cannot find a way to work. Policies that remove the barriers to employment, thus decreasing this number, are obviously beneficial,” he and colleague Megan Russell in their new investors note from their offices in Charlottesville, Va.
They added that “officially-reported unemployment numbers decrease when enough time passes to discourage the unemployed from looking for work. A decrease is not necessarily beneficial; an increase is clearly detrimental.”
Then there is the Misery Index, which is a calculation based in inflation and unemployment, both numbers the duo say are underscored by the government. He said that the Index doesn’t properly calculate how Uncle Sam is propping up the economy with bond purchases and other actions.
“These tricks, along with a host of other dubious accounting schemes, underreport inflation by about 3 percent,” they wrote, adding that the official inflation rate is just 1.24 percent.
“Today, the Misery Index would be 7.54 using official numbers,” they wrote. But if calculations tabulating the full national unemployment including discouraged workers, which is 10.2 percent, and the historical method of calculating inflation, which is now 4.5 percent, ‘the current misery index is closer to 14.7, worse even than during the Ford administration.”

Paul Bedard, the Washington Examiner's "Washington Secrets" columnist, can be contacted at pbedard@washingtonexaminer.com.

Web URL: http://washingtonexaminer.com/article/2542604

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Unemployment Rate - U6

2000 - 2013

From : 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 To : 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 Check U6 Unemployment Rate

Quick Links : 1994-2013 2000-2013 2005-2013 2007-2013

Unemployment Rate - U6

2000 - 2013

Year	Jan	Feb	Mar	Apr	May	Jun	Jul	Aug	Sep	Oct	Nov	Dec	Year
2000	7.1	7.2	7.1	6.9	7.1	7.0	7.0	7.1	7.0	6.8	7.1	6.9	2000
2001	7.3	7.4	7.3	7.4	7.5	7.9	7.8	8.1	8.7	9.3	9.4	9.6	2001
2002	9.5	9.5	9.4	9.7	9.5	9.5	9.6	9.6	9.6	9.6	9.7	9.8	2002
2003	10.0	10.2	10.0	10.2	10.1	10.3	10.3	10.1	10.4	10.2	10.0	9.8	2003
2004	9.9	9.7	10.0	9.6	9.6	9.5	9.5	9.4	9.4	9.7	9.4	9.2	2004
2005	9.3	9.3	9.1	8.9	8.9	9.0	8.8	8.9	9.0	8.7	8.7	8.6	2005
2006	8.4	8.4	8.2	8.1	8.2	8.4	8.5	8.4	8.0	8.2	8.1	7.9	2006
2007	8.4	8.2	8.0	8.2	8.2	8.3	8.4	8.4	8.4	8.4	8.4	8.8	2007
2008	9.2	9.0	9.1	9.2	9.7	10.1	10.5	10.8	11.0	11.8	12.6	13.6	2008
2009	14.2	15.1	15.7	15.9	16.4	16.5	16.5	16.7	16.7	17.1	17.1	17.1	2009
2010	16.7	17.0	17.0	17.1	16.6	16.5	16.5	16.5	16.8	16.7	16.9	16.6	2010
2011	16.2	16.0	15.8	16.0	15.8	16.1	16.0	16.1	16.3	16.0	15.5	15.2	2011
2012	15.1	15.0	14.5	14.5	14.8	14.8	14.9	14.7	14.7	14.5	14.4	14.4	2012
2013	14.4	14.3	13.8	13.9	13.8	14.3	14.0	13.6	13.6	13.7	13.1	13.1	2013

Check U-1, U-2, U-3 (official), U-4, U-5 and U-6 unemployment rates in US

U-1 Unemployment Rate U-2 Unemployment Rate U-3 (Official)Unemployment Rate U-4 Unemployment Rate U-5 Unemployment Rate U-6 Unemployment Rate

What is U6 unemployment rate ?

The U6 unemployment rate counts not only people without work seeking full-time employment (the more familiar U-3 rate), but also counts "marginally attached workers and those working part-time for economic reasons." Note that some of these part-time workers counted as employed by U-3 could be working as little as an hour a week. And the "marginally attached workers" include those who have gotten discouraged and stopped looking, but still want to work. The age considered for this calculation is 16 years and over

Quick Links : Unemployment Rates during Presidencies
Franklin Delano Roosevelt ( 1929 - 1933 )	Harry S. Truman ( 1945 - 1953 )
Dwight David Eisenhower ( 1953 - 1961 )	John Fitzgerald Kennedy ( 1961 - 1963 )
Lyndon Baines Johnson ( 1963 - 1969 )	Richard Milhous Nixon ( 1969 - 1974 )
Gerald Rudolph Ford ( 1974 - 1977 )	James Earl Carter ( 1977 - 1981 )
Ronald Wilson Reagan ( 1981 - 1989 )	George Herbert Walker Bush ( 1989 - 1993 )
William Jefferson Clinton ( 1993 - 2001 )	George Walker Bush ( 2001 - 2009 )
Barack Hussein Obama ( 2009 - Till Now )

Quick Links : Unemployment Rates
USA	United Kingdom	Japan	Euro area
Euro area - 16	Euro area - 15	Euro area - 13	Euro area - 12
European Union - 27	European Union - 25	European Union - 15	Belgium
Bulgaria	Czech Republic	Denmark	Germany
Estonia	Ireland	Greece	Spain
France	Italy	Cyprus	Latvia
Lithuania	Luxembourg	Hungary	Malta
Netherlands	Austria	Poland	Portugal
Romania	Slovenia	Slovakia	Finland
Sweden	Croatia	Turkey	Norway

The Bureau of Labor Statistics measures employment and unemployment (of those over 16 years of age) using two different labor force surveys conducted by the United States Census Bureau (within the United States Department of Commerce) and/or the Bureau of Labor Statistics (within the United States Department of Labor) that gather employment statistics monthly. The Current Population Survey (CPS), or "Household Survey", conducts a survey based on a sample of 60,000 households. This Survey measures the unemployment rate based on the ILO definition. The data are also used to calculate 5 alternate measures of unemployment as a percentage of the labor force based on different definitions noted as U1 through U6: U1 : Percentage of labor force unemployed 15 weeks or longer. U2 : Percentage of labor force who lost jobs or completed temporary work. U3 : Official unemployment rate per ILO definition. U4 : U3 + "discouraged workers", or those who have stopped looking for work because current economic conditions make them believe that no work is available for them. U5 : U4 + other "marginally attached workers", or "loosely attached workers", or those who "would like" and are able to work, but have not looked for work recently. U6 : U5 + Part time workers who want to work full time, but cannot due to economic reasons. Below is the overview of these six measures. U1:This is the proportion of the civilian labor force that has been unemployed for 15 weeks or longer. This unemployment rate measures workers who are chronically unemployed. During business-cycle expansions, this rate captures structural unemployment. However, during lengthy business-cycle contractions, this rate is also likely to include a significant amount of cyclical unemployment. U1 tends to be relatively small, in the range of 1-2 percent. U2:This is the proportion of the civilian labor force that is classified as job losers (workers who have been involuntarily fired or laid off from their jobs) and people who have completed temporary jobs. During business-cycle expansions, this rate is likely to capture some degree of frictional unemployment. However, during business-cycle contractions, this rate is most likely to consist of cyclical unemployment. U2 is larger than U1, but still remains substantially less than the official unemployment rate (U3). U3:This is the official unemployment rate, which is the proportion of the civilian labor force that is unemployed but actively seeking employment. U4:This is the official unemployment rate that is adjusted for discouraged workers. In other words, discouraged workers are treated just like other workers who are officially classified as unemployed, being included in both the ranks of the unemployed and the labor force. It is technically specified as the proportion of the civilian labor force (plus discouraged workers) that is either unemployed but actively seeking employment or discouraged workers. The addition of discouraged workers generally adds a few tenths of a percentage point to the official unemployment rate. U5:This augments U4 by including marginally-attached workers to the unemployment rate calculation. Marginally attached workers are potential workers who have given up seeking employment for various reasons. One of these reasons is that the workers believe such effort would be futile, which places them in the discouraged worker category. Those who have other reasons for not seeking employment are placed in the broader marginally-attached workers category. The addition of marginally-attached workers adds a few more tenths of a percentage point to the official unemployment rate. U6:This augments U5 by including part-time workers to the unemployment rate calculation. The addition of part-time workers adds a full 2-3 percentage points to the official unemployment rate. This measure of unemployment is perhaps the most comprehensive measure of labor resource unemployment available. Who is counted as unemployed? Persons are classified as unemployed if they do not have a job, have actively looked for work in the prior 4 weeks, and are currently available for work. Actively looking for work may consist of any of the following activities: Contacting: An employer directly or having a job interview A public or private employment agency Friends or relatives A school or university employment center Sending out resumes or filling out applications Placing or answering advertisements Checking union or professional registers Some other means of active job search Who is not in the labor force? Labor force measures are based on the civilian noninstitutional population 16 years old and over. Excluded are persons under 16 years of age, all persons confined to institutions such as nursing homes and prisons, and persons on active duty in the Armed Forces. The labor force is made up of the employed and the unemployed. The remainder—those who have no job and are not looking for one—are counted as "not in the labor force." Many who are not in the labor force are going to school or are retired. Family responsibilities keep others out of the labor force.

Source : U.S. Bureau of Labor Statistics

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Record 20% of Households on Food Stamps in 2013

January 21, 2014 - 4:34 PM
By Ali Meyer
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(AP Image)

(CNSNews.com) -- A record 20% of American households, one in five, were on food stamps in 2013, according to data from the U.S. Department of Agriculture (USDA).

The numbers also show there was a record number of individuals on food stamps in 2013 and that the cost of the program, the Supplemental Nutrition Assistance Program (SNAP), was at an all-time high.

The USDA says that there were 23,052,388 households on food stamps in the average month of fiscal 2013, an increase of 722,675 from fiscal year 2012, when there were 22,329,713 households on food stamps in the average month.



Those numbers were compared with the Census Bureau’s estimates for the total number of U.S. households in the last month (September) of each fiscal year to determine the percentage of all U.S. households in that fiscal year that were on food stamps.

In 2013, according to the Census Bureau, there were 115,013,000 households, which means the that the households on food stamps--23,052,388 households--equaled 20.0% of all households.

In the past five years alone, the number of households on food stamps has greatly increased. In fiscal year 2009 – Oct. 1, 2008 through Sept. 30, 2009 -- the number of households on food stamps was 15,232,115. Five years later, in 2013, that amount had increased by 51.3% to reach 23,052,388 households.



Not only have households seen a major increase in food stamps’ participation, but so have individuals.

In 2013, the monthly average for individuals on food stamps hit an all-time-high of 47,636,084, according to the USDA, an increase of 1,027,012 over the 46,609,072 individuals who were participating in the program in 2012.

That number has dramatically increased from five years ago. In fiscal year 2009, the number of individuals participating in the food stamp program was 33,489,975. In 2013, the number was 47,636,084, an increase of 42.2%.



Furthermore, the cost of food stamps, the Supplemental Nutrition Assistance Program (SNAP), has reached an all-time high.

For fiscal year 2013, the SNAP program cost $79,641,880,000, which is a 164% increase over the past decade. When adjusted for inflation, the cost of the SNAP program was $30,153,090,000 in fiscal year 2003.

During the last five years, the SNAP program grew by 36.8%, from $58,223,790,000 in 2009 to $79,641,880,000 in 2013. The business and economic reporting of CNSNews.com is funded in part with a gift made in memory of Dr. Keith C. Wold.

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Unemployment - Getting to the Truth

Posted by Roger O'Daniel on January 23, 2014 at 1:17pm
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Our US Government and the Federal Reserve are not telling the truth about the health and stamina of the United States economy. The economic indicators that they use to measure the health of the United States economy are invalid by design. They try to hide the monetary and fiscal mismanagement of our economy. The mainstream media proclaims economic recovery while the exact opposite is true. Our public education system and most universities do not provide the knowledge and understanding that students need to discern the truth.
Any person with a lick of common sense would define unemployment as the percentage of people out of work divided by the people who are able to work. If you do that calculation, you would obtain an unemployment rate somewhere north of 35%, not under 7%. The Bureau of Labor Statistics (BLS) has two measurements for unemployment: U-3 and U-6. The current US Administration and the mainstream media use the U-3 calculation. It is the percentage of people who are receiving unemployment compensation divided by the number of working jobs. The BLS counts people working two part-time jobs twice. If they receive disability benefits, they are not counted as unemployed, even though they could work. If the unemployed are no longer eligible for unemployment benefits, they are not counted as unemployed. Gallup, an internationally respected professional polling service, explains this and more goring details about the shrinking work force and the true economic figures. Gallup also compares their scientific polling results with the BLS results to expose the awful truth.
For those who believe the economy is recovering with less than 7% unemployment, look around you. Private charities are overwhelmed. Homeless shelters are overflowing. Food shelves cannot keep up with the needy. People are sleeping under bridges in cardboard boxes and in doorways. People are begging with cardboard signs at intersections. Families with children are sleeping in their cars and in abandoned buildings. College graduates cannot find jobs. Adult families are living with their parents because they cannot afford to pay for their own shelter. Hospital emergency rooms and free clinics are overflowing with sick people who cannot pay for their care.
The financial publication “Wall Street Advisor” published an article about this subject. Their advice:
“Don't believe the happy talk coming out of the White House, Federal Reserve and Treasury Department when it comes to the real unemployment rate and the true “Misery Index.” Because, according to an influential Wall Street advisor, the figures are a fraud.
“In a memo to clients provided to Secrets, David John Marotta calculates the actual unemployment rate of those not working at a sky-high 37.2 percent, not the 6.7 percent advertised by the Fed, and the Misery Index at over 14, not the 8 claimed by the government.
“Marotta, who recently advised those worried about an imploding economy to get a gun, said that the government isn't being honest in how it calculates those out of the workforce or inflation, the two numbers used to get the Misery Index figure.”
Here is the link to “The Washington Examiner” post about the full article.
http://washingtonexaminer.com/wall-street-advisor-actual-unemployment-is-37.2-misery-index-worst-in-40-years/article/2542604


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