I’ll tell you, if I hear one more person rationalize Friday’s jobs report by trying to explain to me the difference between the household and establishment surveys, I’ll lose what’s left of my mind. I must’ve heard that 40 times on Friday, as if nobody’d ever realized it before. When Austan Goolsbee started explaining it on Charlie Rose, I knew I’d heard more than enough. It was time to turn off the TV and pick up Marcus Aurelius’ Meditations. I needed a break.
Forget all that household/establishment nonsense. Here’s a better, if somewhat dismissive, take on the report, from Dennis Gartman, who edits and publishes the daily Gartman Letter:
Our long standing clients know that we’ve tried far more often than not to be out of the office on days when the Employment Situation Report is released for over the decades we’ve been producing TGL and for the years before than when were in Chicago and worked for A.G. Becker & Company as that wonderful firms financial futures analyst we’ve found this report to be quite silly. We really cannot think of another way to describe this report, for it is indeed silly. The revisions are huge; the “Street’s” and our misses on the report are even larger, and there is rarely sense to the report from one month to the other. There is sense over time, but we are forced to deal with it in one month increments and that we find comical.
Friday’s numbers were perhaps the most comical of all, for as everyone now knows non-farm payrolls were perhaps 1/5th of what had been expected while the unemployment rate, which should have risen even if the payrolls number had come where the Street’s consensus had expected it, fell sharply. This is stuff and nonsense, and we can only hope that Friday’s report shall chasten almost everyone on the Street to do as we try to do: be out of the office and pay this report no heed whatsoever.
But, as he goes on, there was one sort of small, interesting, notable little thing that most people left out while explaining the difference between the household and establishment surveys. That is, they left out the bit about how many people got left out of the surveys.