Bogus Jobs Report: False Hope, Garbage Numbers & Junk Science?

On Friday, the Bureau of Labor Statistics released their May Employment Situation (jobs) report—and we watched the markets explode in extasy. The unemployment data was significantly better than what had been expected. However, upon closer examination, some concerning questions surface regarding the validity of the data. Was this report just another example of false hope, garbage numbers, and junk science?

Let’s see why we are calling this fallacious propaganda and just another dishonest attempt by the elites and their support network to defend and prop-up their collapsing system of inequality and control over the bottom 90 percent (aka the commoners)…

The Reported April Employment Numbers

For April, the Bureau of Labor Statistics (BLS) reported that total nonfarm payroll employment fell by -20.5 million. Specifically, the number of unemployed persons rose 15.9 million in April—to a total of 23.1 million.

Reported April Employment Decline

The Reported May Employment Numbers

For May, the BLS reported that total nonfarm payroll employment rose 2.5 million. Specifically, the number of unemployed persons fell 2.1 million in May—to a total of 21.0 million.

Reported Change in May Employment

This news was not only great news, it was unimaginably better than expected—by orders of magnitude!

And it was immediately heralded by the financial media and pundits as absolute proof-positive that we have turned the corner, the crisis is over, and it’s all downhill from here.

In fact, many pundits (e.g., Jim Cramer on CNBC and Steve Forbes on Fox Business) proudly boasted that “the Market had gotten it right” (firing back at all those suggesting that the markets had become entirely decoupled from the real economy).

In fact Cramer went so far as to boast about just how amazing our economy is, stating, “You want to know what the perfect economy looks like, at least from the perspective of the stock market? Honestly, it looks a lot like this one, where we have fabulous job growth and very little inflation.”

Here’s Jim on Squawk Box heralding the definitive verdict:

Problem: Those pesky little numbers (the ones underpinning this narrative) were completely bogus! They were intentionally manipulated to do just this–sell a false narrative.

He makes our point about economic equality and pending collapse far better than we could ever have made ourselves. He is boasting about how great the economic system is for the elites–those who own and benefit from the decoupled market.

The elites don’t care about the real economy–they only care about increasing their wealth and power through a rigged system. Who cares if the other 90% of the country (those who depend on the real economy) are suffering. It doesn’t impact the elites and their support network.

From there perspective, things have never been brighter!

Unfortunately, they are too blinded by their own self-interest to see the truth and the ultimate consequences–outcomes that will eventually impact them (just too late for anyone to do anything about it).

Setting aside the fact that only long-term results will ultimately be able to determine if the market was right regarding its abject dismissal of current fundamentals, this irrational exuberance (1) totally ignores the role the Fed has played in creating the market’s artificial V-recovery and (2) is clearly a biased and highly emotional response to ambiguous (at best) news.

Legacy Food Storage

I’m a firm believer in good old fashion common sense—the kind that says if something seems too good to be true… it probably is!

In this case, we’re not talking about something that just seems really good. No, we’re talking about something that was unimaginably great—like on an astronomical scale… like a hundred-million light years better!

Facts are never that good—only 100% pure, unadulterated fiction is.

Let’s delve into the numbers and discuss some of the serious problems with this employment report…

The Problem with the Employment Numbers

There is a problem in the numbers. It is a significant problem—one those “invested” in a certain market outcome have, at best, glossed over and, at worst, intentionally ignored and swept under the carpet. It is the massive pink elephant in the room.

In a nutshell, here’s the problem…

We know that at least 23.3 million folks lost their job in April.

How do we know this? We know this from hard data provided by the weekly jobless claims report (see April and May’s numbers below).

Weekly Initial Jobless Claims During the Coronavirus Pandemic--Week Ending May 30, 2020

However, the employment report only captured 15.9 million of thema miss of 7.4 million unemployed Americans.

Reported April Employment Numbers

If the “reported” number of unemployed for April was 23.1 million, then that means it was actually 30.5 million if we adjust for the glaring discrepancy.

Now, we know that total job losses during the pandemic period have been closer to 43 million… but the fact remains that the April jobs report massively under-reported that.

Where did the missing 10+ million unemployed Americans go?

Did they really all go back to work in April—before we reopened anything?

They have just disappeared… wiped off the map… erased from the books???

And if that was the absurd case for April, then what confidence do we have it was correct for May? Answer: None!

Moving on to May, the jobs report actually claimed an actual net gain of +2.1 million jobs (lowering the unemployed to just 21 million).

First, the adjusted unemployment (just for the April error) would actually be 28.4 million—with no additional error in May.

Second, we know that at least 9.1 million Americans still lost their jobs in May (based on actual jobless claims). Therefore, this would require that 11.2 million Americans suddenly went back to work—to enable us to arrive at that “projected” net gain of +2.1 million jobs.

However, based on the margin of error from April, we likely have a range of anywhere from +2.1 million to an actual loss of -5.3 million.

That’s all we know because the data is so bad!

Furthermore, the May report acknowledged that 40% of the gains were part-time employment.

Reported Increase in Part-Time employment in May

This is not a positive, as it forced folks to return to work with a significant reduction in their pre-Covid income and a total loss of their safety net (unemployment).

In other words, they got shafted—as usual!

Finally, the vast majority of these “gains” are likely to be temporary because businesses were pressured to bring folks back in order to have all those government loans they received forgiven.

If the demand is not there to support those moves, what do you think is going to happen once their loans are wiped clean?

That’s right, they will be forced to discretely lay those folks again—especially the part-time (easy target) positions.

What we have is a bunch of garbage numbers!

Here’s a look at the raw data we used:

Unemployment Data Analysis: The True Picture

But we’ve known for a long time that the BLS employment reports are garbage—an easily manipulated guesstimate (skewed in the direction of market and political desires).

That’s why the numbers are always quietly adjusted after one, two, and three months—as well as one year later. But nobody cares by then or even notices, they have already moved on to other “fake” news. We all suffer from Shiny Object Syndrome and a terribly short attention span.

Here are the adjustments made to previous months in the May report:

Adjustments made to employment numbers by the Bureau of Labor Statistics for previous months

Model Manipulation: An Example of Garbage & the Junk “Science” Behind It

Still not convinced? Let’s look at an example of how these “too good to be true” numbers were produced.

It would appear as if someone pressured the Bureau to hit a number—or produce a great result. In order to do that, they had to adjust their model.

It is a complex model—one that attempts to project what the actual employment is—based on limited soft data. To accomplish this, they make assumptions for a wide range of variables.

One of these variables is what is referred to as the birth-death rate. Now we’re not talking about people but, rather, businesses. This is one of the variables they radically adjusted in order to artificially produce a good number. They disclosed this in the fine print of the report—buried in the footnotes.

When you clicked the link to visit a separately published document (“Frequently asked questions: The impact of the coronavirus (COVID-19) pandemic on The Employment Situation for May 2020”), they actually reveal the shocking truth about what they did:

Net Birth-Death Rate Model Changes for Businesses

Now, you would think—based both on (1) the clear negative trend in pandemic-related business closures and (2) the fact that the covered period was prior to most, if not all, re-openings—that they would adjust the variable downward. I mean that makes sense, right?

Nope, they aggressively increased it!

They went from a standard forecast (based on a 2019 “perfectly functioning economy” model) of 207,000 new net business… to the ridiculous idea that 345,000 new business were created and fully staffed in May!

Business Birth-Death Rate Adjustments

I mean you can’t make this stuff up!

Look at the pandemic trend and, specifically, the net birth-death forecast for April:

Business Birth-Death Rate Forecast Trend

We went from 143,000 net new businesses in February (likely too high in and of itself), to 26,000 in March, to a net -533,000 loss of businesses in April… to an absurd +345,000 gain in May????

Now, do you really think folks went out and opened a net of +345,000 new business in May? Of course not, we most certainly lost business—a number much closer to the April net number of -553,000.

The pandemic impact on businesses has a lag effect, meaning it will take time for the impact to fully hit businesses—especially small ones. As time goes on, more will shutter permanently and file for bankruptcy—not less. It’s like a rising wave that will take months to peak!

There is absolutely no way—when we weren’t even at a point where we could even get a moderate number of existing businesses back open and when there was extremely low consumer demand due to health concerns—that 345,000 net new businesses opened!

But they had to hit a number, and this was a sneaky (hidden in the deep weeds) way to do just that—to artificially adjust the employment projection massively upwards without drawing attention. The devil is always in the details!

This “fake” source of employment accounts for most—if not all—of the supposed gains in employment.

Let’s look at one last example—employment gains in dentist offices.

According to the American Dental Association (ADA), there are 200,000 dentists working in dentistry in the US as of 2019.

Now, according to the ADA, this number means “using their dental degree in some fashion.”

Let’s say 90% are in private practice (meaning working in a private dental office and not solely involved in research, teaching, or administrative capacities).

Furthermore, let’s assume some of these dentists work in teams—meaning as part of a joint practice (i.e., professional partnership). Let’s say on average 2 dentists per practice (a very low-ball estimate).

That means we have roughly 90,000 dentist “businesses” or “offices” out there. That’s very conservative and the actual number is probably materially less. But let’s go with that.

The BLS report actually projected that we gained +245,000 jobs in dental offices in May???

Bogus May Job Gains in Dentist Offices

Again, you can’t make this stuff up.

Legacy Food Storage

That would—using our very conservative assumptions—equate to every single dental office in America adding nearly three new positions during the month!

And they “did” this despite the fact that people were cancelling their dental appointments in droves due to health concerns and dentists were having to close their practices (or at least reduce their hours of operation) in response!

That gives new meaning to the term ludicrous.

This is what happens when you start changing variables in your models in an effort to manipulate the outcome.

What Is the Real Takeaway from the Employment Numbers???

The real employment picture is as disconnected from these numbers as the “markets” are divorced from the true economic reality.

But the markets (meaning the elite who own them) don’t care—they just keep playing the game and reaping the benefits. After all, it doesn’t matter if they are wrong in the short run. It’s a “can’t lose” game for them—the Fed has their back and will just swoop in and bail them out if (when) things go bad.

Although, in this case, I do think the majority of the market “surge” we witnessed on Friday was caused by the well-timed injection of additional liquidity by the Fed—not a true and material “buy the news” reaction from investors.

(You can look back over the data since the markets bottomed and you can literally see the liquidity repeatedly and predictably flow in every time the markets stumbled even a bit.)

The takeaway is that the numbers are bogus, garbage, or junk. It is a marketing ploy to sell a story line: America’s economy is back—re-elect Trump in November.

(Never mind that it is a complete illusionary fabrication!)

What matters to the elites is that the show must go on—now get back to work making us money and stop sticking your noses where they don’t belong (our administrative affairs).

What Does It All Mean for the Commoners?

I am making you aware of all this for three reasons…

First, I want to help shed some much-needed light on the subject. When it comes to these labor reports, we are dealing with some serious voodoo math and fanciful wishes cleverly wrapped in a cloak of science and reason! Most folks have no clue how to decipher these intentionally complex and deceptive reports.

My hope is to draw the proverbial curtains back and provide you with a glimpse behind the scenes—to reveal the “wizard” so to speak.

You will hear them cry over the loudspeaker: “Pay no attention to the man behind the curtain!”

Don’t listen to them!

Second, I want you to be very careful about investing your money in the markets. Don’t buy the “everything is wonderful” message that is being delivered by the financial media and market pundits.

They have no idea what is going on—or at least don’t want to acknowledge or talk about it. They never get it right. The market makes a move and then they try to find “news” that explains it. Ignore them—they will cost you (the retail investor) money.

Third, this just further illustrates the point we made in our article Exposing the Wealth Gap: Economic Inequality Is Driving Civil Unrest. The elites (and their network of supporters) can’t see, or won’t accept, that the system is broken.

I highly encourage you to read this article—it lays out the case for why we are on the precipice of economic and societal collapse. You need to understand the commoner-elite relationship and how it impacts sustainability of civilizations. It really is a must read that will open your eyes and—at the very least—get you thinking about things we should all be questioning.

The elites are looking at and clinging to bogus trends—trends that reinforce their belief that everything is just peachy. They need that narrative to be true so that they can continue to fleece the commoners and expand their wealth and power.

Let’s be crystal clear: neither the economy nor the markets are even remotely in good shape.

Things are collapsing all around us. The commoners can see it coming—but (as we explain in our article) history demonstrates that the elites rarely (if ever) see it coming before a society crosses the point of no return and the irreversible collapse accelerates.

We are facing a system that has degenerated into an unrecognizable shadow of its once glorious and good self.

The commoners are waking up to the fact that (1) the deck has been massively and inescapably stacked against them and (2) their wealth, their future, their American dream (and that of their future generations) has been stolen from them and delivered to the elites.

This has produced massive economic inequality, which, in turn, has birthed civil unrest.

That unrest will only grow and broaden as part of the new “great awakening,” or what William Strauss and Neil Howe refer to as the Fourth Turning.

We can no longer trust the experts—their data is biased and flawed. We see this with the data and information from the pandemic, the job front, the economy, and the markets.

The elites (and their supporters) are making an intense and coordinated attempt to sell you a fairytale alter-reality. It’s akin to the “program” used by the machines to control the masses in the Matrix.

It’s all just a lie being peddled in a desperate effort to keep the ship afloat and the system humming away for the elites. They need the commoners to keep mindlessly turning the giant flywheel of their economic machine—one designed to transfer more and more power and wealth into the pockets of the elites.

We are their batteries. Or, for the gamers out there, we are effectively being farmed.

Conclusion

Be not fooled, the ship is sinking. Ignore the noise and trust your gut. When you see the water gushing into the engine room with your own eyes—trust your eyes!

They can only fake it to make it so long.

Like the Titanic, the “unsinkable” American economy hit an iceberg a long time ago. We are now in the final stages of the disaster. The fateful chain of events is playing out. The water is flowing in faster and faster… and our ship is going to sink.

If you’ve been prepping and preparing for this, the time has come to put on your life preserver and head for your life raft.

If you haven’t…

Get preparednow may be your last chance!

Legacy Food Storage

Doug

Doug is a passionate servant of Christ and holds an MBA, BBA (Summa Cum Laude), and AAcc from Liberty University, as well as an additional two years of study at Bible college. He has over 20-years of corporate finance, accounting, and operations management experience—spanning the public, private and nonprofit sectors. He is proud to have served his country as a member of the 82nd Airborne Division and his local communities as a firefighter/EMT and reserve peace officer—experience that has provided him with a unique skill-set when it comes to emergency medicine, firearms, crisis management, and wilderness survival. Doug enjoys playing the drums, prepping, and spending time with family—especially in the Outer Banks of NC.