"It profits me but little that a vigilant authority always protects the tranquillity of my pleasures and constantly averts all dangers from my path, without my care or concern, if this same authority is the absolute master of my liberty and my life."

--Alexis de Tocqueville, Democracy in America

Friday, October 5, 2012


Government statistics are usually not that important, because over time variances and volatility and sampling anomalies even out.    But in the month before what may be a world-historical election between two world views (socialism and freedom), it matters that we understand what those statistics are and aren't.   The 7.8% unemployment figure comes from the household survey.   Here is the month-over-month change in the household survey for employment in the US, which I discussed below, but want to include again to make a visual point:

Here is the month-over-month change in employment in the US in the establishment survey:

The establishment survey is obviously significantly less volatile and, hence, more reliable.  

The upshot?   The 873,000 jobs created in the household survey, which factors into the 7.8% unemployment rate, doesn't mean too much.   The 114,000 jobs created in the establishment survey -- less than August, which in turn was less than July -- does mean something, and it isn't good for the direction of the economy.

That doesn't mean that Obama won't tout the 7.8% like a life preserver to keep himself from sinking after his dismal debate performance.   And the MSM -- in which the innumerate lead the innumerate -- will go along.

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