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Home Publications Blogs Beat the Press The Fed Has Better Memory Than Reporters Covering It

The Fed Has Better Memory Than Reporters Covering It

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Thursday, 21 March 2013 04:53

That would seem to be the case based on much of the news coverage of the Fed's decision to continue its quantitative easing program. Many pieces have highlighted relatively positive economic reports in recent months, most notably job creation numbers. Fortunately the Fed seems to have a much better knowledge of the data than the reporters who cover it. While job growth over the last few months has been somewhat higher than the average for the recovery, it does not stand out as being especially strong.

In the last three months jobs growth has averaged 192,000. By contrast, it averaged 271,000 for the same three months a year ago. Apparently the Fed has access to this data, which it used in its decision on continuing its quantitative easing policy.

 

Monthly Job Growth

btp-2013-03-21

Source: Bureau of Labor Statistics.

 

Note: First sentence corrected in response to comment.

Comments (4)Add Comment
...
written by JKessler, March 21, 2013 7:04
Looks like some of the first sentence is missing.
graph not loading
written by David, March 21, 2013 9:05
getting a question mark instead of a plot the monthly job growth (on my desktop)
...
written by skeptonomist, March 21, 2013 9:56
Since the graph is missing, I looked at some numbers at FRED, such as CE16OV, civilian employment (ultimately from BLS). Dean is right, recent numbers are not particularly impressive, although as he always says monthly numbers are highly erratic.

The long-time pattern is for a sharp drop in employment in a recession, then more gradual recovery, but this time the recovery has been and remains slower than normal, and the trend shows no signs of improvement recently.
Do financial journalists have long term memory problems?
written by David M, March 21, 2013 1:04
The Fed was pretty clear last time. QE? and ZIRP would continue until unemployment fell below 6.5%. Since we're nowhere near that, nothing changed. D'uh.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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