Here's what's so stupid about obsessing over today's jobs report
It's finally here: the August jobs report.
The Bureau of Labor Statistics is set to release the August employment report at 8:30 a.m. ET.
Since this could potentially be the final major economic data point before the Federal Reserve decides whether or not to raise interest rates for the first time in 9 years at its September meeting, people are making a really big deal over this report.
But here's there thing:
First, as many have pointed out, August is historically a bad month for jobs. In fact, it has disappointed economists 78% of the time since 1988, according to Deutsche Bank's Joe LaVorgna. So a disappointing August number could arguably be the norm in what's been an expanding economy.
And second, August payrolls usually print low when they first come out, but are later revised up, as Pantheon Economics' chief economist Ian Shepherdson pointed out in a recent note to clients.
If you look at the chart below, you will see the initial August estimate (in turquoise) compared with the net revision (in forest green) since 2010. As Shepherdson puts it, "The patterns are very clear."
So basically, what we end up seeing in the report today might be lowballing what's actually happening in the economy...
In any case, standby for 8:30 a.m. ET.
