Government Estimates

One of the services that government provides markets is statistical information. Virtually every government agency produces reams of statistics for people to chew on. The Bureau of Labor and Statistics has some of the most important data the market digests, Unemployment numbers. Over the past several months, there has been a divergence of the government statistics and the statistics put out by independent private pollsters. The government stats look better.
Here are the government numbers

Here are the Gallup estimates

Clearly the government numbers are better than the Gallup numbers, and not just by a little.

People that are biased against Obama tend to want to believe the Gallup unemployment numbers over the official government ones. This happened in the mid 1990′s as well, as people couldn’t believe some of the stats coming out of the BLS under Clinton. Of course, the left skewered the stats when Bush was in office. It seems the right and left have an agenda.

That’s why it was interesting to read this blog post about farm statistics. Farm statistics are totally unrelated to the BLS, and come out from the USDA. Farmers caught on the wrong side of the market accuse the USDA of skewing the data.

“US agriculture has a love-hate relationship with the reports.  It seems that farmers cannot live with them and cannot live without them, and more than one farmer on the wrong side of the market at the time of the report has accused the USDA statisticians of conspiring with the grain market against the farmer.”

Here is the document that explains exactly how they collect and compile the information.  March 31 is the date of the release.  The news will move the market.

I think that one can count on the US government to be supplying good and timely data to the marketplace. I don’t think some other governments, notably China, supply good data. They shade it. One thing is for sure, sometimes statisticians are like accountants, they look at the exact same thing and count them differently. But I would like to see proof that the US is shading the numbers before I actually believed it.

Most of the misunderstanding can be chalked up to not knowing how the sampling was done by either the government or the private agency.

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