Bingo: BLS Pads Employment Report With Birth/Death Plug – SPX Melts Up

Update:   MELT-UP EXTRAORDINAIRE.  Dow up 242 points; SPX up 24 points.  All on a phony number and big downward revision to last month’s phony number.

The Bureau of Labor Statistics, armed with the highly unreliable Census Bureau employment data sample (you, the Taxpayer pay for the this tragicomedy), released its extraordinarily overanalyzed and extraordinarily useless non-farm payroll report today.  According to Bloomberg, the Wall St. brain trust consensus estimate was for 220k jobs “added” to the economy.   The “actual” reported number was 223k.

As predicted, the S&P 500 melted up – click to enlarge:


Of course, the hedge fund algos completely ignored the unexpectedly bad number of 126k for March was revised lower to an atrociously horrific 85k. This is by design, people. Hedge fund computers only care about a headline report. The revision does not make the headlines.

As further predicted by my friend and colleague, Mark Kellstrom of Strategic Energy Research, the BLS used its fictitiously calculated “Birth/Death Model” plug metric to pad today’s report with 213,000 “fairytale” jobs.  We wrote about this here:  LINK.  You can verify this here:   LINK – I’m not making this stuff up – I’m not sure Lewis Carroll could have made this up…

The only incorrect prediction was that it was not a huge beat of expectations.  However, it was a huge beat of the “whisper” number, given the poor ADP Payroll report.  I did suggest in a post earlier this week that the ADP report was intentionally managed lower to set up today’s “surprise” and help the Fed stimulate a hedge fund algo SPX melt-up.

Of course, the BLS and it’s mentally challenged Census Bureau lap-dog want us to believe that the unemployment rate is only 5.4%.   I guess this could be true if you want to completely ignore the 93.1 million of the working age population that is not considered to be part of the labor force.  Of course, according John Williams, who looks at how the Government calculated the unemployment rate in 1990 vs. now, the true unemployment rate is more like 23%.

Naturally, if you don’t like something, just ignore it.  The BLS has determined that only 3,000 energy sector jobs were lost in April.  Hmmm…that one has me scratching my head. Especially after you look at this chart produced by Zerohedge yesterday:  LINK.   Retail was given credit with producing 12.1k jobs during April.  That is patently absurd given that we know the retail sector is closing down at least 6,000 stores nationwide over the next 18 months.

It just doesn’t get any more absurd than this.  It just goes to show:  “There’s no B.S. Like The BLS.” 

11 thoughts on “Bingo: BLS Pads Employment Report With Birth/Death Plug – SPX Melts Up

  1. Dave–I barely made it thru Economics 202 in the 50’s, so please excuse my ignorance about currencies and their fluctuation, BUT why is the dollar index rising when all the players should know that the end of the music is near and the boilers are just about to go underwater?

    1. Emerging market currencies collapsing faster than the US Dollar is! And many of those emerging markets borrowed large amounts of money in US Dollars! LOL

  2. remember birth death was created in 1998, when 2,000 jobs were added. it was then just a simple small adjustment based on assumption that when companies closed or laid off employees, some started their own small companies and hired one or two people.

    now look at it. give govt an inch and it takes a mile.

  3. When I saw this bullshit this morning, and having read your blog earlier this week, I had to giggle. I really laughed at the minus 40,000 job revision from the prior week. I can’t wait to see the adjusted GDP figures for the first quarter, I bet it’s down at least 1 full percentage point from the original .2, because they just can’t massage away imports. Not yet.

  4. Dave, thanks for your recent prediction about this, which enabled me to scalp a tidy profit from the SP spike. Shortly before 8:30 EST I bought some SP 500 – leveraged 20 to 1 – then watched the 8:30 spike you predicted, then got out as soon as the spike began to dip. I closed just before it hit 2100, because I knew 2100 was the symbolic figure the machines were targeting.

    And I took an extra little scalp from the simultaneous gold spike, again getting out as soon as the spike stopped.

    That said, profiting from the machines this way makes me feel like I need a shower. It’s just sick that this has become what passes for a “market”. Cf:

  5. PS, I also got back into shorting Amazon as it opened with a hedge-fund/algo spike at exactly 9:30 EST, as it was front-run primed by the anticipated non-farms payroll Soviet data.

    In light of which, I think perhaps the ultimate QED demonstration of the disconnection of asset prices from material realities, is the fact that today’s 2 percent spike in Amazon – putatively an “information technology” enterprise – has been based on a report of an increase of a handful of moron-level jobs like these:

  6. The BLS along with the Census Bureau and other “government” monitoring/regulator agencies, are of course all in bed with TPTB and anything they publish should be read for entertainment purposes only! Never cease to provide a good laugh each and every Friday. Only its a tragi-comedy.

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