The data are available at and

Right on the front page. The price level has been accelerating (increasing at faster rates) since last fall:

and output is increasing:

and unemployment is not increasing:

13 thoughts on “The data are available at and”

  1. Re: “unemployment is not increasing” — except it is. The dip was mostly caused by a revision of the past numbers plus people leaving the labor force. In other words, it was noise.

    We’d need to see about 150,000 increase in the the labor force for unemployment not to increase.

    And a 12 month inflation rate of -.2% for October is still not quite hyperinflation territory, though the .3% increase for october was good news.

  2. If a time series can be made to have a negative value by “noise” then, by definition, its statistically indistinguishable from zero and one cannot reject the hypothesis that it is decreasing. In other words, unemployment is “not increasing”.

    Why is a one year moving average any more significant than a one month or one decade moving average? The models tell us to look at acceleration. Look at the graph, it looks more like a upward pointing parabola than anything else, i.e. the price level is accelerating. To get decelerating inflation from that graph you’d have to fit some S curve that has an inflection point in the future.

  3. the unemployment rate bounces around quite a bit, so it’s better to look at Payroll Employment.

    Payroll employment needs to increase by nearly 150,000/month to keep up w/ population growth to keep the unemployment rate constant. Last month payroll employment declined 11,000. Though that could be revised substantially, it’s not statistically close to 150,000…

    Look at July — payroll employment was off 304,000, but the unemployment rate actually fell. Then, the next month, payroll employment did much better, but due to data revisions and a slowing pace of workforce exits, the unemployment rate rose by .3… Fact is, we’ll have to add an extra 160,000 jobs/month before we can say “unemployment is not increasing”… I suspect that could happen as early january, when the SA factor reverses, but we’re not there yet…

    Summers and Bernanke should have waited ’till we see serious job gains before they declared victory…

  4. TV, by adding a discussion of the extensive or participation margin, you’ve increased the burden on the “more stimulus” crowd. What model would suggest even more stimulus — more than we already have — would bring people back into the labor market *when* output and inflation are increasing?

    Suppose, for example, the people dropping out of the labor market are retirees (e.g. 63 year olds that decide to retire early). Would AD stimulus bring them back into the market?

  5. First, glad to see you’ve conceded that unemployment is still increasing — after a sharp .4 hike in October and a -.2 correction on the earlier numbers in November do not imply no change.

    More stimulus => More demand => More supply.

    Totally standard AS/AD model implies as much.

    Imagine the 22 year old, who is taking classes and waiting until the labor market gets better before seriously looking for a job. Why shouldn’t that coax her back into the market?

    The case for more stimulus/more QE isn’t as strong as it was last summer (when Bernanke thought there’d be no way we’d get to 10% unemployment), but it’s still pretty clear.

  6. TV, on what planet does that sort of rhetoric work? Its nice to see you’ve conceded that I’m the king of the world and I can make The Truth out of piles of garbage while taking shots at random political officials.

    Anyway, your thing that looks like a logical statement isn’t. More stimulus in 2004 would have caused inflation.

  7. bottom line is that the Fed’s predictions for Q4, 2010 are: Unemployment at 9.3-9.7 and inflation at 1.4-1.7.

    So, expected inflation is below a target which I think is, itself, clearly too low.

    Even if those predictions move to 8.3-8.7% unemployment and 2.4%-2.7% inflation w/ more good economic news, why wouldn’t we be better off with 3.0% inflation and 7.5% unemployment next December?

  8. TV, what data are you looking at? The only “core” number that I see flat is CPI excluding energy and food, not seasonally adjusted (and this is entirely due to decreases in food prices). Otherwise, overall CPI is up, core CPI seasonally adjusted is up and the PPI is way up. Is there a good reason to think that NSA core CPI (or food prices more specifically) is more important than all the others?

  9. FYI-people look at the “Core” which is the normal less food and energy, b/c food and energy are much more volatile and bounce around quite a bit, so are much less indicative of overall trends, which i guess is why Macroeconomists stress the Core numbers…

    The core rate, SA, was flat in November. Core CPI, NSA was -.2%.

    PPI, last two months was up a total of .1% if i remember correctly…

    I’ve come around though, and you’re right — these numbers are just screaming out “Zimbabwe-like hyperinflation just around the corner”, high unemployment and low inflation projection notwithstanding…

  10. TV, you don’t have to remember anything. PPI is reported on the front page of and its up 2.1% over the last two months… 2.1% over two months is over 13% on an annual basis.

    I’m not sure your position that policy is too tight is supported by the core inflation data.

  11. You were nearly right and I was wrong: Core PPI last two months is -.1%.

    Core CPI in November: 0.0%.

    The PPI swings much more than the CPI, so the core CPI is the far and away the single most important inflation number published. That doesn’t mean we don’t also look at food and energy, or the PPI, but these other numbers bounce all over the place, and so if you want to know if inflation is getting picked up in the system or not, you look at the Core CPI.

    The Core CPI was flat in November. This was below the Fed’s forecast. The Fed’s forecast for next year is for the Core CPI to be between 1.4-1.7%. That’s below the Fed’s own target, which itself is too low.

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