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★ The most important economic overview that I have read in many years ★
@BaluBalu- I have no idea why you are accusing Mark of "abuse".
First of all, he does not "have two threads to discuss the same thing". Mark chose to post his thread in the Off-Topic section, and because I felt that it was of legitimate financial interest I posted this thread to channel readers to it.
You are welcome to your opinion regarding Mark's thread, but to accuse the report's author of intellectual dishonesty is unsubstantiated and abusive. Just because someone has a differing financial perspective certainly does not equal "dishonesty". Personally, I feel that the author of the report in question is correct, and that the statistics used by the government fail to accurately represent the existing financial conditions for the average American.
I fail to see where Mark has attempted to "force other people"to do anything at all, and I also fail to understand your evident animus towards his postings.
One final point regarding governmental statistical reporting: such reporting is presumably of value to reflect the real financial environment of the citizens and voters of the United States.
From the recent election results is is evident that those citizens and voters are in strong disagreement with the financial picture presented by those reports. That disagreement is a major factor in the present national disaster of the current administration.
@davidrmoran: thanks for your views. Have you already consulted the books I cited?
I read Campbell summaries when their work came out, with reviews pointing out that along with wise advice it is cherry-picked, half-baked, lacking protein, to coin a phrase:
msf: His point, as I take it, is that the numbers, though accurate are misunderstood. So things are worse than people get from the numbers reading them simplistically. True enough. But then he goes and does the same thing by simplistically presenting some reasons why the numbers don't say what people think they say. *************** Actually, I understood him to say that the tools and metrics do measure what they are supposed to measure, but it's the wrong stuff. It offers a cloudy picture of what it is we want to know: unemployment, inflation. I did not take away a message that the monthly numbers are misunderstood; rather, the wrong tools are being employed.
In a single magazine (online or not) article, not necessarily aimed at the number-crunching wonks, I'd be willing to say that a very particular and in depth presentation would have been out of place. He made his case. He asserted that the tools he and his team created offer a more accurately focused picture of true life. Too early for me to disagree. If he would make available a follow-up which exposes his new statistical method to the light of day, then we could agree or disagree about that. For a million years, I have known that the current metrics are screwy: just simply not presenting a real-life snapshot that corresponds to Reality very well.
He's illuminating and expressing a thing that we all take for granted. Every month, people and the Markets react to the published numbers, but the numbers --- every time--- deliver a "head-fake." As I said above, I'll bet he and his team prefer to keep their method proprietary. We'll see. I'm with OJ: this business needs to be examined and acknowledged, rather than assumed, again and again.
Actually, I understood him to say that the tools and metrics do measure what they are supposed to measure, but it's the wrong stuff.
What he wrote was:
Our research revealed that the data collected by the various agencies is largely accurate. Moreover, the people staffing those agencies are talented and well-intentioned. But the filters used to compute the headline statistics are flawed.
Which is what I wrote: "Bottom line: I agree with his broad thesis that headline numbers don't present an accurate picture."
That's not the same thing as saying that the reports measure the wrong stuff. They measure everything. It's all there for everyone to see. All he's doing is taking that data and "filtering" (presenting) it differently to produce different headlines.
He's complaining about how the report data is used (presented), not about the wrong stuff being measured.
We can quibble about interpretation all that we want to, but it does nothing to change the fact that the government was telling the voters that all was OK, but the voters weren't buying it.
For many months prior to the elections Judy Woodruff of the PBS Newshour conducted focus groups across the United States. Some groups agreed with certain aspects and issues of the coming election, others disagreed.
However: every group felt that the financial condition of the United States that they saw bore little resemblance to any information being produced by the government.
that the government was telling the voters that all was OK
The government (read Bureau of Labor Statistics) produced accurate data, though with misleading headlines. It was politicians and some reporters (who knew better or were ignorant) who told voters that the numbers meant "that all was OK".
In a similar vein, was it the government or Democratic politicians saying that Biden was in great shape?
1. Understanding data: If one doesn't understand what data represents (definitions, methodology) then one can be led astray or be confused. Hence questions about how Morningstar analysts could possibly praise 1 star funds (e.g. gold-rated OAKIX).
2. Accuracy of government data: Traditionally the data produced by government departments has been accurate and apolitical. Tradition is being upset as we speak. My realtor told me this afternoon that when she looked up flood maps on FEMA, the first thing she saw was:
FEMA.gov is being updated to comply with President Trump's Executive Orders. Thank you for your patience and understanding.
@msf: I agree with your observations, but it seems to me to be a quibble about labels.
OK: Here in the United States major political and information systems, or at least significant portions of them, were telling the voters that all was OK, but the voters weren't buying it.
And they knew that SOMEBODY at the controls was not dealing with their reality.
And Donald Trump and his cohort of propagandists took great advantage of that.
(Aside:) Comm'on msf... you know what I'm trying to say here.
My concern is that painting with broad brushstrokes, conflating the messengers with the messages, inculcates distrust in government research and analysis. And in doing so, enables "Donald Trump and his cohort of propagandists".
Here's a recent NPR report on the 'crumbling infrastructure' of federal data.
The statistical agencies are also faced with a crisis facing the broader survey and polling industry — a shrinking rate of people willing to answer questions.
Distrust extends well beyond answering surveys. Vaccinations, for example. I hear that the results aren't in yet. That's not what government and government-sponsored research data say. Rather it's how politicians (and one in particular) are presenting that data.
We are in violent agreement. I'm just trying not to throw out the baby (data) with the bathwater (misinterpretation, whether deliberate or simply the result of misunderstanding).
(sorry, no diet preferences in 'this most important overview' thread)
the politico article seems like pretentious nothingburger to get the rightwing agitated.
dont like gov stats , such as on 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."
"...in a country where people are facing systematically higher financial and job insecurity, the people are, on average, less likely to save...."
This is a rather odd conclusion involving multiple uses of the word "saving". It does not come from the study cited in the linked webpage. That study shows, as one would expect, that if one has a fixed amount of money to save and/or invest, the higher the sense of risk the less one is inclined to take on more additional risk by investing.
The linked article's author notes that this higher savings rate (and lower investing rate) results in lower total assets over time. This combination of savings, investing, and growth they then rename "savings". Thus "savings" is used two different ways.
this study shows that if more people are in a financially precarious position ... the more they will stay away from investing in risky assets .... and instead remain invested in bonds and savings accounts. But as we know, this means that over time, these people can save less
But "as we know", the more uncertain people feel about the future, the more they save. Rather than allocate a fixed amount of money (as in the cited study) between savings and investing, people increase the size of the pot - save more - when they are worried.
Policymakers and academics have linked the increase in savings to higher economic uncertainty often pointing to ... increases the volatility of expected future income, while at the same time lowering the level. Both of these effects may induce people to save more ...
dont like gov stats , such as on inflation? The Politico piece doesn't say that there's anything wrong with the statistics, just how they're analyzed and presented. Which is why, rather than stopping at U-3, I gave U-4 and a cite to other government "filterings" of the statistics. Think that some of the 80,000 different items in the CPI should get different weightings? Then do your own arithmetic. The raw data and how it's collected is published. At least for now.
saving more relative to income does not mean they (the least wealthy) have maintained or improved purchasing power...the thesis is that more robust\complex (e.g., equity) investing is needed to have a shot at that, but its less likely to happen. to oversimplify, it seems these studies point mostly to the same longterm problems of financial inequality worsening. whether one believes in the validity of gini for its measure, or some other stat.
lastly, there is absolutely no comparison to the sporadic reports on inflation with the 24\7 pre-election blitzkrieg from trump\gop\MAGA across ALL media outlets. in fact, there are even sporadic reports that trump policies are going to make price levels worse rather than have them retrospectively fixed on day 1. in year 5 of trump, there is no sign that gop voters have, or will assign accountability to trump for this or any other issue. they will accept deflected blame elsewhere, even newly to the local gop politician or musk, but its never going to be at a scale that concerns trump. i would not be surprised if MAGA doesnt even blame trump for a recession as long as they can chant about lower prices.
Comments
First of all, he does not "have two threads to discuss the same thing". Mark chose to post his thread in the Off-Topic section, and because I felt that it was of legitimate financial interest I posted this thread to channel readers to it.
You are welcome to your opinion regarding Mark's thread, but to accuse the report's author of intellectual dishonesty is unsubstantiated and abusive. Just because someone has a differing financial perspective certainly does not equal "dishonesty". Personally, I feel that the author of the report in question is correct, and that the statistics used by the government fail to accurately represent the existing financial conditions for the average American.
I fail to see where Mark has attempted to "force other people"to do anything at all, and I also fail to understand your evident animus towards his postings.
From the recent election results is is evident that those citizens and voters are in strong disagreement with the financial picture presented by those reports. That disagreement is a major factor in the present national disaster of the current administration.
https://sciencebasedmedicine.org/385/
(just one)
Similarly Greger (sp), who along with wise advice also just sounds simpleminded and black-white, not to say misleading:
https://www.healthline.com/nutrition/how-not-to-die-review
(Kind of like someone who would flatly assert:
>> chicken eggs are terrible for human health )
***************
Actually, I understood him to say that the tools and metrics do measure what they are supposed to measure, but it's the wrong stuff. It offers a cloudy picture of what it is we want to know: unemployment, inflation. I did not take away a message that the monthly numbers are misunderstood; rather, the wrong tools are being employed.
In a single magazine (online or not) article, not necessarily aimed at the number-crunching wonks, I'd be willing to say that a very particular and in depth presentation would have been out of place. He made his case. He asserted that the tools he and his team created offer a more accurately focused picture of true life. Too early for me to disagree. If he would make available a follow-up which exposes his new statistical method to the light of day, then we could agree or disagree about that. For a million years, I have known that the current metrics are screwy: just simply not presenting a real-life snapshot that corresponds to Reality very well.
He's illuminating and expressing a thing that we all take for granted. Every month, people and the Markets react to the published numbers, but the numbers --- every time--- deliver a "head-fake." As I said above, I'll bet he and his team prefer to keep their method proprietary. We'll see. I'm with OJ: this business needs to be examined and acknowledged, rather than assumed, again and again.
What he wrote was: Which is what I wrote: "Bottom line: I agree with his broad thesis that headline numbers don't present an accurate picture."
That's not the same thing as saying that the reports measure the wrong stuff. They measure everything. It's all there for everyone to see. All he's doing is taking that data and "filtering" (presenting) it differently to produce different headlines.
He's complaining about how the report data is used (presented), not about the wrong stuff being measured.
For many months prior to the elections Judy Woodruff of the PBS Newshour conducted focus groups across the United States. Some groups agreed with certain aspects and issues of the coming election, others disagreed.
However: every group felt that the financial condition of the United States that they saw bore little resemblance to any information being produced by the government.
Bottom Line: Donald Trump.
The government (read Bureau of Labor Statistics) produced accurate data, though with misleading headlines. It was politicians and some reporters (who knew better or were ignorant) who told voters that the numbers meant "that all was OK".
In a similar vein, was it the government or Democratic politicians saying that Biden was in great shape?
Old joke: how can you tell when a politician is lying?
https://www.thecut.com/2015/11/here-is-one-way-to-tell-if-a-politician-is-lying.html
This matters for two reasons at least:
1. Understanding data: If one doesn't understand what data represents (definitions, methodology) then one can be led astray or be confused. Hence questions about how Morningstar analysts could possibly praise 1 star funds (e.g. gold-rated OAKIX).
2. Accuracy of government data: Traditionally the data produced by government departments has been accurate and apolitical. Tradition is being upset as we speak. My realtor told me this afternoon that when she looked up flood maps on FEMA, the first thing she saw was:
https://www.cbsnews.com/news/former-top-noaa-scientist-craig-mclean-trump-sharpie-gate-warning/
OK: Here in the United States major political and information systems, or at least significant portions of them, were telling the voters that all was OK, but the voters weren't buying it.
And they knew that SOMEBODY at the controls was not dealing with their reality.
And Donald Trump and his cohort of propagandists took great advantage of that.
(Aside:)
Comm'on msf... you know what I'm trying to say here.
My concern is that painting with broad brushstrokes, conflating the messengers with the messages, inculcates distrust in government research and analysis. And in doing so, enables "Donald Trump and his cohort of propagandists".
Courts are sowing the same distrust. In overturning Chevron, the Supreme Court said that they understand complex issues better than subject experts.
https://www.nrdc.org/stories/what-happens-if-supreme-court-ends-chevron-deference
Here's a recent NPR report on the 'crumbling infrastructure' of federal data. https://www.npr.org/2025/01/24/nx-s1-5250264/unemployment-rate-cpi-inflation-census-bureau-labor-statistics
Distrust extends well beyond answering surveys. Vaccinations, for example. I hear that the results aren't in yet. That's not what government and government-sponsored research data say. Rather it's how politicians (and one in particular) are presenting that data.
We are in violent agreement. I'm just trying not to throw out the baby (data) with the bathwater (misinterpretation, whether deliberate or simply the result of misunderstanding).
the politico article seems like pretentious nothingburger to get the rightwing agitated.
dont like gov stats , such as on 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
This is a rather odd conclusion involving multiple uses of the word "saving". It does not come from the study cited in the linked webpage. That study shows, as one would expect, that if one has a fixed amount of money to save and/or invest, the higher the sense of risk the less one is inclined to take on more additional risk by investing.
The linked article's author notes that this higher savings rate (and lower investing rate) results in lower total assets over time. This combination of savings, investing, and growth they then rename "savings". Thus "savings" is used two different ways. But "as we know", the more uncertain people feel about the future, the more they save. Rather than allocate a fixed amount of money (as in the cited study) between savings and investing, people increase the size of the pot - save more - when they are worried. Juelsrud, Ragnar E. & Wold, Ella Getz, 2020. "The Saving and Employment Effects of Higher Job Loss Risk"
dont like gov stats , such as on inflation?
The Politico piece doesn't say that there's anything wrong with the statistics, just how they're analyzed and presented. Which is why, rather than stopping at U-3, I gave U-4 and a cite to other government "filterings" of the statistics. Think that some of the 80,000 different items in the CPI should get different weightings? Then do your own arithmetic. The raw data and how it's collected is published. At least for now.
its just the media has suddenly stopped assigning political blame for egg, car, and house prices.
Say what?
https://thehill.com/policy/healthcare/5154415-trump-moves-hamper-bird-flu-response-as-egg-prices-spike/
https://edition.cnn.com/2025/02/19/cars/trumps-autos-tariffs-prices/index.html
https://abcnews.go.com/US/wireStory/trump-administration-slash-hud-workers-tackling-housing-crisis-119046960
saving more relative to income does not mean they (the least wealthy) have maintained or improved purchasing power...the thesis is that more robust\complex (e.g., equity) investing is needed to have a shot at that, but its less likely to happen.
to oversimplify, it seems these studies point mostly to the same longterm problems of financial inequality worsening.
whether one believes in the validity of gini for its measure, or some other stat.
lastly, there is absolutely no comparison to the sporadic reports on inflation with the 24\7 pre-election blitzkrieg from trump\gop\MAGA across ALL media outlets. in fact, there are even sporadic reports that trump policies are going to make price levels worse rather than have them retrospectively fixed on day 1.
in year 5 of trump, there is no sign that gop voters have, or will assign accountability to trump for this or any other issue.
they will accept deflected blame elsewhere, even newly to the local gop politician or musk, but its never going to be at a scale that concerns trump.
i would not be surprised if MAGA doesnt even blame trump for a recession as long as they can chant about lower prices.