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News Link • Economy - Economics USA

Depression Numbers: 22 Percent Unemployment Rate Is Headed for 35

Last Friday, the Bureau of Labor Statistics (BLS) reported the economy created 192,000 new jobs and the unemployment rate fell to 8.9%. The good news was reported almost everywhere as a turning point in the U.S. economy. For example, CNBC said, “U.S. employers hired more workers in February than in any month since May last year and the unemployment rate fell to a near two-year low, the strongest sign yet the recovery has become self-sustaining. . . . “We have moved into the expansion phase of the economic cycle and the economy is self-sustaining,” said Brian Levitt, an economist at Oppenheimer Funds in New York.” (Click here for the complete CNBC story.) But if you look deeper into the numbers, as John Williams does at, you don’t see the turnaround picture. In fact, just the opposite is going on. In his latest report, Williams estimates the government is routinely overstating job growth by “230,000 jobs” a month. Using simple math, 192,000 created jobs (according to BLS) subtracted from 230,000 overstated jobs gives you an actual net loss of 38,000 jobs. I called Williams to check my analysis, and he told me it is not that simple because the government’s estimations are “the worst in modern economic history.” Williams says unemployment numbers are “openly misleading” and virtually “worthless.” In an interview yesterday from his San Francisco office, Williams told me when it comes to calculating unemployment numbers, the BLS is “flying blind.” He admitted, “It is hard to put an exact number on the actual job losses last month, but we likely lost jobs—not gained them.” He added, “The job losses could be as high as 30,000 for last month.”

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