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Voters Were Right About the Economy. The Data Was Wrong.
Speaking of unemployment numbers - How stupid I have been. One way to lie with the current count of unemployed is to fire a lot of people but stave off the count for several months by paying them with other people's money and calling them employed. I wonder; yes, how will the count be done? Employed but fired or unemployed? Will there be a one time uptick in September or will it be less severe because many found new employment doing something - perhaps many converting to contractors doing the same job but with overhead and business facility costs added on?
I agree that we need to do a better job of measurement(s). But I disagree with his premise.
I find it amusing that the author did not bother to point out that some of the measurements overestimated inflation for the past year. For example, actual rents have been going down for a while now but OER (the measurement used as a proxy for housing in inflation calc) was (is?) still going up for obvious reasons. Apartment vacancy rate has been more than 5% for sometime now. You will find some of this info from Charlie Bilello at the link below and you know his firm is one of the biggest (if not the biggest) RIAs in the country and have very little reason to torture data.
("Asking Rents peaked back in 2022 and have now declined on a year-over-year basis for 20 straight months. Rents have been held down by a multi-family construction boom that significantly increased supply and is leading to the highest vacancy rates (6.9%) since at least 2019.")
Similarly, with the median family income the author pointed out ($52K), one gets free or nearly free healthcare under ACA. Why anyone getting free healthcare cares about healthcare inflation? You and I paying for their healthcare might complain.
Look at the demographic differences in who voted how and the author's theory on why the democrats lost does not hold good. I do not have any party dog in the fight but I do not appreciate being fed like a farm animal (by the author).
IMO, the author's approach only supplies more ammunition to the anarchists and to the business and political leaders that are only eager to feed the anarchists. This is a free society of cocked up citizens and people who profit from them. You get in the middle of those groups and they both will crush you.
I do not read too many opinion pieces (actually I do not read much if it is not for work) and I do not know and do not want to know this author's background. Human beings produce a lot of waste / garbage.
Good piece, @Mark and @Old_Joe, with plenty to think about.
The figure I zeroed in on first is the unemployment rate, and I agree 100% that U-3 isn't representative of what's going on. But U-6 has several similarities with what that group did, and U-6 is 7.5%. Where is the huge gap between that and his figure? Maybe in the $25,000 income element?
@BaluBalu. “Who exactly are the “anarchists you mention and who are the “ business and political leaders that are only eager to feed the anarchists”? And who are”cocked up citizens “ you speak of? I would appreciate a bit of clarification. Thanks in advance.
I found the article to be insightful and clear. The author's own career pedigree lends weight to what he's explaining. Also, the newfangled yardstick that he and his team designed gives a much better, more accurate look at the Big Picture. I suppose he's keeping that proprietary? How many of us have known for a very long time that the gov't statistics were not portraying reality with clarity? MOST of us, surely. This article reads like a real game-changer.
@Crash: "Also, the newfangled yardstick that he and his team designed gives a much better, more accurate look at the Big Picture."
I agree that the measures he takes aim at can for sure be critiqued (like I said about U-3), and that he's right that they undercount some elements, but without more disclosure, I don't know how it's possible to say it's "accurate." I think there's enough there to show that the "real" story is higher UEP, inflation, etc., but is he right about the magnitude? I don't know how you can tell.
@Crash: "Also, the newfangled yardstick that he and his team designed gives a much better, more accurate look at the Big Picture."
I agree that the measures he takes aim at can for sure be critiqued (like I said about U-3), and that he's right that they undercount some elements, but without more disclosure, I don't know how it's possible to say it's "accurate." I think there's enough there to show that the "real" story is higher UEP, inflation, etc., but is he right about the magnitude? I don't know how you can tell.
Yes, I see your point. You were being more appropriately analytical than I was. And you're correct. We could tell how accurate his own statistics are if he offered the particulars about his own team's method. I was concentrating on just how lucidly he was describing the discrepancy between official gov't statistics and the reality lived on the ground by so many (most?) actual people.
this seems like pretentious nothingburger to get the rightwing agitated.
dont like gov stats like inflation? do some work, there have been independent trackers around for a long time, and what's more, they dont hide behind opaque proprietary nonsense. (which frankly, should be a source of shame from someone trying to brand as 'Ludwig'...austrians rolling over) there are signs that gov stats will become more opaque, or going away all together, so i guess there is that.
finally, the author lost a lot of credibility claiming there was some miraculous insight on the economy from voters pre-election. the same voters now poll the trump economy is great, even though there hasnt been enough time for much change. its just the media has suddenly stopped assigning political blame for egg, car, and house prices.
the simplest story is that income inequality has been getting worse for >2 decades, and the masses somehow think this will improve under corrupt billionaires despite results under trump 1.0 the longterm impact of the highest accelerating wealthgap ever seen :
"...in a country where people are facing systematically higher financial and job insecurity, the people are, on average, less likely to save. This widens the current account deficit of that country (the current account essentially indicates the savings preferences vs. investments of a country). I know, I am going out on a limb here and I am not going to point my fingers at specific countries with low job and financial security, but if you are running a country with a massive current account deficit, maybe one way to improve the current account deficit would be to increase financial security and reduce financial stress in your society, rather than engage in mercantilist economics."
Comments
Thanks.
I agree that we need to do a better job of measurement(s). But I disagree with his premise.
I find it amusing that the author did not bother to point out that some of the measurements overestimated inflation for the past year. For example, actual rents have been going down for a while now but OER (the measurement used as a proxy for housing in inflation calc) was (is?) still going up for obvious reasons. Apartment vacancy rate has been more than 5% for sometime now. You will find some of this info from Charlie Bilello at the link below and you know his firm is one of the biggest (if not the biggest) RIAs in the country and have very little reason to torture data.
https://bilello.blog/2025/the-state-of-the-markets-february-2025
https://www.mutualfundobserver.com/discuss/discussion/60921/the-week-in-charts-charlie-bilello/p6
("Asking Rents peaked back in 2022 and have now declined on a year-over-year basis for 20 straight months. Rents have been held down by a multi-family construction boom that significantly increased supply and is leading to the highest vacancy rates (6.9%) since at least 2019.")
Similarly, with the median family income the author pointed out ($52K), one gets free or nearly free healthcare under ACA. Why anyone getting free healthcare cares about healthcare inflation? You and I paying for their healthcare might complain.
Look at the demographic differences in who voted how and the author's theory on why the democrats lost does not hold good. I do not have any party dog in the fight but I do not appreciate being fed like a farm animal (by the author).
IMO, the author's approach only supplies more ammunition to the anarchists and to the business and political leaders that are only eager to feed the anarchists. This is a free society of cocked up citizens and people who profit from them. You get in the middle of those groups and they both will crush you.
I do not read too many opinion pieces (actually I do not read much if it is not for work) and I do not know and do not want to know this author's background. Human beings produce a lot of waste / garbage.
The figure I zeroed in on first is the unemployment rate, and I agree 100% that U-3 isn't representative of what's going on. But U-6 has several similarities with what that group did, and U-6 is 7.5%. Where is the huge gap between that and his figure? Maybe in the $25,000 income element?
I agree that the measures he takes aim at can for sure be critiqued (like I said about U-3), and that he's right that they undercount some elements, but without more disclosure, I don't know how it's possible to say it's "accurate." I think there's enough there to show that the "real" story is higher UEP, inflation, etc., but is he right about the magnitude? I don't know how you can tell.
dont like gov stats like inflation? do some work, there have been independent trackers around for a long time, and what's more, they dont hide behind opaque proprietary nonsense. (which frankly, should be a source of shame from someone trying to brand as 'Ludwig'...austrians rolling over)
there are signs that gov stats will become more opaque, or going away all together, so i guess there is that.
finally, the author lost a lot of credibility claiming there was some miraculous insight on the economy from voters pre-election. the same voters now poll the trump economy is great, even though there hasnt been enough time for much change.
its just the media has suddenly stopped assigning political blame for egg, car, and house prices.
the simplest story is that income inequality has been getting worse for >2 decades, and the masses somehow think this will improve under corrupt billionaires despite results under trump 1.0
the longterm impact of the highest accelerating wealthgap ever seen :
"...in a country where people are facing systematically higher financial and job insecurity, the people are, on average, less likely to save. This widens the current account deficit of that country (the current account essentially indicates the savings preferences vs. investments of a country). I know, I am going out on a limb here and I am not going to point my
fingers at specific countries with low job and financial security, but if you are running a country with a massive current account deficit, maybe one way to improve the current account deficit would be to increase financial security and reduce financial stress in your society, rather than engage in mercantilist economics."
https://klementoninvesting.substack.com/p/ambiguity-is-worse-than-risk