Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 1
Bullet Edition Number 15
FOMC Preview, November Labor and October Trade Details
December 8, 2019
____________
There Is No Sustainable, Moderate U.S. Economic Growth in Play,
Irrespective of Federal Reserve Pronouncements
FOMC Needs to Cut Rates to Boost the Economy and Help Consumers,
But It Likely Will Not Do So at Its December 10th to 11th Meeting
The FOMC Likely Will Continue to Meet Any Unexpected Funding Needs of
Its Parent Banking System, In Order to Maintain Systemic and Market Liquidity
Record Low Headline Unemployment Continued Amidst
Levels of Labor-Market Stress Consistent With a Major Recession
Annual Payroll Growth Should Drop to Its Post-Great Recession Low, Along
With the Benchmark Revisions Indicated for Headline January 2020 Payrolls
Improved October Trade Deficit Was an Artefact of the General Motors Strike,
Which Otherwise Put a Dent in Recent GDP Activity
November 2019 Money Supply M3 Annual Growth
Jumped to 8.5%, Highest Since February 2009
____________
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 2
_________________________________________________________________________________
Updated ShadowStats Commentaries and Scheduling (Effective Immediately - Published previously in Special Commentary No. 985)
More-Frequent Publication and Making the Various ShadowStats Commentaries More Concise
Updated Timing, Re-Tasking and Scope of the Various ShadowStats Commentaries:
Daily Updates, Bullet Editions, Flash Updates, Special Commentaries & Watches
The Daily Update (Unrevised) posts daily, as needed, on the ShadowStats home page:
www.ShadowStats.com, right-hand column, providing initial coverage of all major U.S.
economic reporting, within two-to-three hours of headline publication, as well as coverage of
unusual financial-market or political developments.
Bullet Edition (Revised) publishes each weekend, providing ShadowStats primary coverage of
the past week’s unfolding activity, reviewing economic releases, financial-market, systemic and
political developments. [Next planned release: Bullet Edition No. 16 (December 15th) covering
November CPI, PPI and Retail Sales.]
Flash Update (Revised) interspersed with Bullet Editions is limited in scope, highlighting near-
term events or developments—usually same- or next-day—with the economy, financial markets,
politics, the Federal Reserve or with other news of significance that should be reviewed in
advance of the Weekend Bullet Edition. [Next release planned: Flash Update No. 16 (December
11th, covering the December FOMC Meeting.]
Special Commentaries (Revised) should publish every quarter or so, providing a more-
comprehensive overview of general, broad economic and financial conditions and trends, such as
seen in the just-published Special Commentary No. 985.
Hyperinflation and Consumer Liquidity Watches (Revised) will supplement irregularly the
weekly Bullet Edition, covering evolving market and consumer circumstances, otherwise with
occasional specific data covered directly in the weekly Bullet Editions.
Economic Surveys of the General Public are conducted irregularly and are open to both
subscribers and nonsubscribers.
Telephone Consulting is included as part of our regular service. If you have a question or
otherwise would like to talk, please call John Williams at (707) 763-5786.
All Current and Earlier ShadowStats Commentaries (back to 2004) are available in the Archives (click
on All Commentaries, then List Commentaries) in the left-hand column of the ShadowStats Home Page.
Your comments and suggestions are invited. Always happy to discuss what is happening.
Best Wishes — John Williams (707) 763-5786, [email protected]
_________________________________________________________________________________
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 3
Contents – Bullet Edition No. 15
Overview 4 FOMC and the U.S. Economy 4
Economic Activity – Latest Numbers and General Outlook 6 November Employment and Unemployment, Payrolls 6 Household Employment and Unemployment Survey 6 Current Labor-Market Stress: Common to Recession, Not to Record-Low Unemployment 6
Graph 1: Comparative Headline November 2019 Unemployment Rates: U.3, U.6 and ShadowStats Alternate ..................... 6
Graph 2: Civilian Employment-Population Ratio, January 1994 to November 2019 ............................................................ 8
Graph 3: ShadowStats-Alternate Unemployment Rate, Inverted Scale, January 1994 to November 2019 .............................. 8
Graph 4: Headline Participation Rate, January 1994 to November 2019 ............................................................................. 9
Graph 5: Headline U.3 Unemployment Rate, Inverted Scale, January 1994 to November 2019 ............................................ 9
Nonfarm Payroll Employment Buffeted by GM Strike .. 10
Graph 6: Nonfarm Payroll Employment, Monthly 1939 to Date ......................................................................................... 11
Graph 7: Nonfarm Payroll Employment, 2000 to Date ...................................................................................................... 11
Graph 8: Year-to-Year Change, Payroll Employment, Monthly, 1940 to Date .................................................................... 12
Graph 9a: Year-to-Year Change, 2000 to Date ................................................................................................................. 12
Graph 9b: Year-to-Year Change, 2000 to Date, Reflecting Implied Annual Benchmarking ................................................. 13
Graph 10: Retail Sales Payroll Employment, January 2000 to November 2019 ................................................................. 14
Graph 11: Retail Sales Payroll Employment Year-to-Year Change, January 2000 to November 2019 ................................ 14
Graph 12: Construction Payroll Employment, January 2000 to November 2019 ............................................................... 15
Graph 13: Construction Payroll Employment Year-to-Year Change, January 2000 to November 2019 .............................. 15
Graph 14: Manufacturing Payroll Employment, January 2000 to November 2019 ............................................................ 16
Graph 15: Manufacturing Payroll Employment Year-to-Year Change, January 2000 to November 2019............................ 16
Skewed by GM Strike, 4q2019 Trade Deficit Likely Narrowed, 1q2019 Should Widen 17
Graph 16a: Real Trade Deficit, 1q1994 to Early 4q2019 (Reflecting Only GM-Strike Disrupted October Level) ............... 17
Graph 16b: Real Merchandise Trade Deficit, 1q1994 to Full 4q2019 (Estimated Impact from End of GM Strike) ............. 18
Graph 17: Net Exports of Goods and Services (GDP Accounting) 1q1994 to Third Quarter 3q2019 ................................. 18
Consumer Needs and Finances 19
Graph 18: Real Average Weekly Earnings – Production and Nonsupervisory Employees ................................................... 19
Graph 19: Real Consumer Credit Outstanding (Ex-Federally Held Student Loans)............................................................ 20
Graph 20: Total Real Credit Market Debt Outstanding, Household Sector ........................................................................ 20
Federal Reserve Activity 21
Graph 21: Nominal Annual Growth, Money Supply M1, M2, M3 – Official and ShadowStats Continuation ........................ 21
Graph 22: St. Louis Fed Adjusted Monetary Base – Bi-Weekly, Level, 2000 to Date ......................................................... 22
Graph 23: St. Louis Fed Adjusted Monetary Base – Bi-Weekly, Year-to-Year Change, 2000 to Date ................................. 22
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 4
Overview
FOMC and the U.S. Economy
FOMC POLICY – Despite Unexpected, Continuing and Deepening Weakness in Key Economic
Indicators, the FOMC Likely Will Keep Rates Unchanged at Its December Meeting. Business
indicators ranging from Freight Activity (see Special Commentary No. 985), to Consumer Liquidity
conditions (see Consumer Needs and Finances page 19, Graphs 18 to 20), show dire need for economic
stimulus. Yet, contrary to the needs of the economy and the consumer, the FOMC likely will tout bloated
headline reporting of November labor conditions as a rationale for not easing anew at its December 10th
to 11th meeting.
The October FOMC cut targeted Federal Funds Rate by the expected quarter point, to a range of 1.50% to
1.75%, with Balance Sheet expansion continuing into Mid-2020. The economy was just perfect, then, per
the Fed, with ―sustained, moderate expansion,‖ except for then crashing Industrial Production and
collapsing Freight Activity, which only have deteriorated, along with the intensifying need for increased
systemic liquidity.
Despite the Fed’s October 30th Spiel of perfect economic balance, it really needs to ease anew at this
December Meeting; it should not wait until January 28th to 29th 2020. The FOMC fantasy economy and
stable liquidity remain anything but balanced and stable (see Flash Update Nos. 13, 14 and 15, As
discussed in Special Commentary No. 985, it was FOMC actions and inactions and lack of appropriate
Federal Reserve oversight, that led to the banking collapse of 2007/8 and the broad non-expansion of
economic activity for nearly a decade, as well as triggering the currently unfolding recession, through its
overly aggressive tightening since late 2017.
Nonetheless, as expectations continue to build for a Fourth-Quarter 2019 GDP contraction, easing
pressures are not going to go away quickly. Pressures indeed should mount rapidly on the Fed for an
early, continued and expanded accommodation (as at the January Meeting), unless common sense takes
better hold of the December Meeting. Such remains contrary to the desires of some on the FOMC Board,
who would prefer to push interest rates higher, once again, in aid to an increasingly troubled banking
system. Even so, the FOMC appears to have set up something that may become akin to perpetual
Quantitative Easing (QE).
Quantitative Easing in Continual Expansion. Along those lines, the December FOMC likely will
continue to expand its ―unofficial‖ renewed QE, which followed the October FOMC, in order to assure
needed liquidity and stability in the overnight markets, for the benefit of liquidity in the banking system,
which owns the Federal Reserve, and for stability of the financial-markets. See Graphs 22 to 23 in the
Federal Reserve Activity section on page 21 and, more broadly, the discussion on the Federal Reserve in
Special Commentary No. 983-B.
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 5
ShadowStats Broad General Outlook Has Not Changed. ShadowStats’ Recession Forecast remains in
place, with U.S. Economic activity in a deepening downturn, as detailed in the recently published Special
Commentary No. 985. Complicated and intensified by deteriorating domestic political circumstances;
watch for a likely accelerating flight from the U.S. Dollar and Stocks into Gold.
With U.S. stocks indices at or near all-time highs, consider that gold has outperformed equities since the
stock-market highs of a year ago (see Flash Update No. 14). Beyond intensified near-term financial-
market risks from negative economic, liquidity and political issues, the ShadowStats broad outlook in the
weeks and months ahead remains for:
A rapidly intensifying U.S. economic downturn, reflected in
Mounting selling pressure on the U.S. dollar, against currencies such as the Swiss Franc,
Continued flight to safety in precious metals, with upside pressures on gold and silver prices, and
Increasingly high risk of extraordinarily heavy stock-market selling.
See details in Flash Update No. 14.
____________________
[Economic Activity – Latest Numbers and General Outlook begins on the next page.]
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 6
Economic Activity – Latest Numbers and General Outlook
November Employment and Unemployment, Payrolls
Household Employment and Unemployment Survey
Current Labor-Market Stress: Common to Recession, Not to Record-Low Unemployment
Historic-Low Unemployment Remains at Odds With Labor-Market Stresses and Deteriorating,
Underlying Economic Conditions. Historically low U.3 unemployment is consistent with an economic
boom, yet high levels of employment stress and a headline ShadowStats Alternate Unemployment
Measure of 20.9% signal an Economy that never fully recovered from the Great Recession.
Graph 1: Comparative Headline November 2019 Unemployment Rates: U.3, U.6 and ShadowStats Alternate
November 2019 U.3 Unemployment eased negligibly to 3.53%, from 3.56% in October (no Auto Strike
distortions), against its historic low 3.52% in September. Rounded to the headline first decimal point,
November U.3 eased to 3.5%, from 3.6% in October and against 3.5% in September. In contrast, extreme
levels of labor–market stress continued [an unchanged Employment-Population Ratio of 61.0%, and a
0
1
2
3
4
5
6
7
8
9
10
0%
5%
10%
15%
20%
25%
1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020
Perc
en
t U
nem
plo
ym
en
t
U.S. Unemployment Rates Headline (U.3 and U.6) versus ShadowStats Alternate
1994 to November 2019, Seasonally-Adjusted [ShadowStats, Bureau of Labor Statistics]
Official Recession
U.3 Unemployment Rate
U.6 Unemployment Rate
ShadowStats Unemployment Rate
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 7
rounded decline of 0.1% (-0.1%) in the Participation Rate to 63.2%], both consistent with an ongoing
recession. They also were more consistent with the ShadowStats 20.9% Alternate Unemployment Rate
than the historically low headline U.3 headline 3.5% unemployment.
Reflecting a monthly decline for those working part-time for economic reasons and an increase in
marginally attached workers (a decline in headline discouraged workers), broader November 2019 U.6
Unemployment declined to 6.87%, from 6.96% in October, versus 6.91% in September. Riding on top of
U.6, the November ShadowStats Alternate Unemployment Estimate, including long-term displaced and
discouraged workers, not counted by the Bureau of Labor Statistics (BLS), declined to 20.9%, from
21.0% in October, versus 20.9% in September. Graph 1 plots those three series since the 1994-
redefinition of the numbers .
The major issue with the current, historically low U.3 headline unemployment rate remains that it still
runs counter to Labor-Market Stress measures, such as the Employment-Population Ratio (Graph 2) and
Participation Rate (Graph 5), which continue to hold at levels consistent with a recession. Under normal
economic circumstances, the high levels of employment stress seen at present, usually would be
consistent with high levels of unemployment and recession, not at record low unemployment, as seen in
the comparative inverted-scale Graph 5 of the headline U.3 unemployment rate, versus Graph 3 of the
inverted-scale, high-level ―recessionary‖ ShadowStats Alternate unemployment measure.
[Further detail and background on the circumstance is found on the Alternate Data Tab (Unemployment
Link) of www.ShadowStats.com, with an up-to-date data table and link there to ShadowStats’ Public
Comment on Unemployment.]
[Graphs to 2 to 5 begin on the next page.]
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 8
Graph 2: Civilian Employment-Population Ratio, January 1994 to November 2019
Graph 3: ShadowStats-Alternate Unemployment Rate, Inverted Scale, January 1994 to November 2019
0
1
2
3
4
5
6
7
8
9
10
58%
59%
60%
61%
62%
63%
64%
65%1
99
4
199
5
199
6
199
7
199
8
199
9
200
0
200
1
200
2
200
3
200
4
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5
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6
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200
9
201
0
201
1
201
2
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3
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8
201
9
202
0
Civ
ilia
n E
mp
loy
men
t-P
op
ula
tio
n R
ati
o
Civilian Employment-Population Ratio To November 2019, Seasonally-Adjusted [ShadowStats, BLS]
0
1
2
3
4
5
6
7
8
9
1010%
11%
12%
13%
14%
15%
16%
17%
18%
19%
20%
21%
22%
23%
24%
199
4
199
5
199
6
199
7
199
8
199
9
200
0
200
1
200
2
200
3
200
4
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5
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6
200
7
200
8
200
9
201
0
201
1
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2
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3
201
4
201
5
201
6
201
7
201
8
201
9
202
0Sh
ad
ow
Sta
ts U
nem
plo
ym
en
t R
ate
(S
cale
In
vert
ed
)
ShadowStats-Alternate Unemployment Rate (Inverted Scale) Long-Term Discouraged/Displaced Workers Included (BLS Excluded Since 1994)
To November 2019, Seasonally-Adjusted [ShadowStats, BLS]
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 9
Graph 4: Headline Participation Rate, January 1994 to November 2019
Graph 5: Headline U.3 Unemployment Rate, Inverted Scale, January 1994 to November 2019
0
1
2
3
4
5
6
7
8
9
10
62.0%
62.5%
63.0%
63.5%
64.0%
64.5%
65.0%
65.5%
66.0%
66.5%
67.0%
67.5%1
99
4
199
5
199
6
199
7
199
8
199
9
200
0
200
1
200
2
200
3
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201
0
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2
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3
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4
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5
201
6
201
7
201
8
201
9
202
0
Part
icip
ati
on
Rate
Participation Rate [Labor Force as a Percent of Population] To November 2019, Seasonally-Adjusted [ShadowStats, BLS]
0
1
2
3
4
5
6
7
8
9
103.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
10.0%
199
4
199
5
199
6
199
7
199
8
199
9
200
0
200
1
200
2
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3
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9
201
0
201
1
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3
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4
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5
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6
201
7
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8
201
9
202
0U.3
Un
em
plo
ym
en
t R
ate
(S
cale
In
vert
ed
)
U.3 Unemployment Rate (Inverted Scale) To November 2019, Seasonally-Adjusted [ShadowStats, BLS]
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 10
Nonfarm Payroll Employment Buffeted by GM Strike
Major Pending Downside Benchmark Revisions to Payroll Reporting Will Not Hit the Headline
Monthly Details Until the Formal January 2020 Revisions, Published on February 7, 2020. Flash
Update No. 5 of August 21st detailed the preliminary 2019 payroll downside benchmarking of 501,000
(-501,000) jobs, primarily in the Retail Sales and related Leisure and Hospitality sectors, which had the
effect of eliminating 20% of the headline growth in payrolls of the prior year. None of these revisions has
been incorporated into headline data, yet.
Separately, a closer-term headline disruption was seen with the headline monthly payroll employment
growth in October and November 2019 tied to the effects of the automobile manufacturing strike at
General Motors. The strike also affected the monthly headline trade deficit, as will be discussed shortly.
The Bureau of Labor Statistics estimated the strike cost manufacturing 42,000 jobs in October, adding
41,000 in November. Headline detail, reflecting the strike’s impact on employment levels and year-to-
year change in payrolls is plotted as reported, in accompanying Graphs 6 to 9 and Graphs 14 and 15.
Annual Payroll Growth of 1.5% Seen in November 2019 Has Been Stagnant for Seven Months,
Holding Well Off the Three-Year Peak Growth of 2.0% in January 2019. Adjusted for the GM strike,
annual growth was at levels last seen coming out of the Great Recession. With major negative benchmark
revisions pending, annual growth clearly should show the weakest annual growth levels of the post-Great
Recession era, hardly sustainable moderate growth (as suggested and reflected in Graph 9b).
The heavily gimmicked current Payroll Employment reporting still does reflect the impact of a
preliminary negative benchmarking of 501,000 (-501,000) jobs, which will be incorporated into the
formal benchmark revisions published with the headline January detail in February 2019. The existing
headline annual growth in Payrolls has been stagnant at 1.5% since May 2019, well off its recent three-
year peak growth of 2.0% in January 2019.
Beyond the pending plunge in annual payroll growth, the tenth straight month of annual decline in Retail
Trade employment (see Graphs 10 and 11), down year-to-year by 0.2% (-0.2%) in November 2019,
should be of some concern to the markets, for the first reading on the Holiday Shopping Season.
Separately, Graphs 12 through 15 of Construction and Manufacturing should not have the hawks on the
FOMC salivating.
[Graphs to 6 to 15 begin on the next page.]
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 11
Graph 6: Nonfarm Payroll Employment, Monthly 1939 to Date
Graph 7: Nonfarm Payroll Employment, 2000 to Date
0
1
2
3
4
5
6
7
8
9
10
0
20
40
60
80
100
120
140
160
1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020
Millio
ns o
f Jo
bs
Nonfarm Payrolls Seasonally-Adjusted Jobs 1939 to November 2019 [ShadowStats, BLS]
0
1
2
3
4
5
6
7
8
9
10
124
128
132
136
140
144
148
152
156
200
0
200
1
200
2
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3
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4
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5
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6
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8
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9
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0
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1
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2
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3
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4
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5
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6
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7
201
8
201
9
202
0
Millio
ns o
f Jo
bs
Nonfarm Payroll Employment Seasonally-Adjusted Levels to November 2019 [ShadowStats, BLS]
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 12
Graph 8: Year-to-Year Change, Payroll Employment, Monthly, 1940 to Date
Graph 9a: Year-to-Year Change, 2000 to Date
0
1
2
3
4
5
6
7
8
9
10
-10%
-5%
0%
5%
10%
15%
20%
1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020
Year-
to-Y
ear
Perc
en
t C
han
ge
Nonfarm Payrolls Year-to-Year Percent Change 1940 to November 2019, Not Seasonally Adjusted [ShadowStats, BLS]
0
1
2
3
4
5
6
7
8
9
10
-6%
-5%
-4%
-3%
-2%
-1%
0%
1%
2%
3%
4%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Year-
to-Y
ear
Perc
en
t C
han
ge
Nonfarm Payrolls Year-to-Year Percent Change 2000 to November 2019, Not Seasonally Adjusted [ShadowStats, BLS]
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 13
Again, consider Graph 9b, with an approximation as to what current headline year-to-year change in
Nonfarm Payrolls should look like after the February 7, 2020 benchmarking. Retail Sales (and related
Leisure and Hospitality) should be heavily impacted, major series that never were benchmarked
adequately in the last year, as discussed in the recently published Special Commentary No. 985.
Graph 9b: Year-to-Year Change, 2000 to Date, Reflecting Implied Annual Benchmarking
Look at these graphs of the latest headline levels of, and year-to-year growth in Payroll Employment in
the major sectors of Retail Sales, Construction and Manufacturing (Graphs 10 to 15). Do these reflect
―Sustainable Moderate Growth‖ as touted by the Federal Reserve?
[Graphs 10 to 15 begin on the next page.]
0
1
2
3
4
5
6
7
8
9
10
-6%
-5%
-4%
-3%
-2%
-1%
0%
1%
2%
3%
4%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Year-
to-Y
ear
Perc
en
t C
han
ge
Nonfarm Payrolls Year-to-Year Percent Change Indicated Partial 2019 Benchmarking
2000 to November 2019, Not Seasonally Adjusted [ShadowStats, BLS]
Official Recession
Current Headline Detail
Implied Benchmarking
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 14
Graph 10: Retail Sales Payroll Employment, January 2000 to November 2019
Graph 11: Retail Sales Payroll Employment Year-to-Year Change, January 2000 to November 2019
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
14.0
14.5
15.0
15.5
16.0
16.5
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Millio
ns o
f Jo
bs
Retail Trade Payroll Employment to November 2019 Millions of Jobs, Seasonally-Adjusted [ShadowStats, BLS]
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
-7%
-6%
-5%
-4%
-3%
-2%
-1%
0%
1%
2%
3%
4%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Year-
to-Y
ear
Perc
en
t C
han
ge
Retail Trade Payroll Employment Year-to-Year Percent Change to November 2019 Not Seasonally Adjusted [ShadowStats, Census Bureau]
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 15
Graph 12: Construction Payroll Employment, January 2000 to November 2019
Graph 13: Construction Payroll Employment Year-to-Year Change, January 2000 to November 2019
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
5.2
5.6
6.0
6.4
6.8
7.2
7.6
8.0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Millio
ns o
f Jo
bs
Construction Payroll Employment to November 2019 Seasonally-Adjusted [ShadowStats, BLS]
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
-20%
-15%
-10%
-5%
0%
5%
10%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Year-
to-Y
ear
Perc
en
t C
han
ge
Construction Payroll Employment Year-to-Year Percent Change to November 2019 Not Seasonally Adjusted [ShadowStats, Census Bureau]
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 16
Graph 14: Manufacturing Payroll Employment, January 2000 to November 2019
Graph 15: Manufacturing Payroll Employment Year-to-Year Change, January 2000 to November 2019
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
11.0
12.0
13.0
14.0
15.0
16.0
17.0
18.0
19.0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Millio
ns o
f Jo
bs
Manufacturing Payroll Employment to November 2019 Seasonally-Adjusted [ShadowStats, BLS]
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
-14%
-12%
-10%
-8%
-6%
-4%
-2%
0%
2%
4%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Year-
to-Y
ear
Perc
en
t C
han
ge
Manufacturing Payroll Employment Year-to-Year Percent Change to November 2019
Seasonally Adjusted [ShadowStats, Census Bureau]
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 17
Skewed by GM Strike, 4q2019 Trade Deficit Likely Narrowed, 1q2019 Should Widen
October 2019 Trade Deficit Narrowed by $4.2 Billion, Encompassing Impact of the General Motors
Strike. Reported by the Census Bureau and Bureau of Economic Analysis on December 5th, the sharp
narrowing of the October Trade Deficit to $47.2 billion, from a revised $51.1 (previously $52.5) billion in
September largely reflected reduced imports due to the GM strike, which also contributed to the $2.4
billion narrowing of September deficit. While a narrowed deficit boosts GDP, the full impact of the GM
strike still will be a net negative for the GDP (see discussion of Industrial Production impact in Special
Commentary No. 985). Separately, where the monthly trade deficits narrowed in revision back to April,
the relative Third-Quarter 2019 versus Second-Quarter 2019 deficit narrowed only minimally, with
minimal positive-revision implications for the third-estimate of Third-Quarter 2019 quarterly GDP
growth.
Where ShadowStats usually annualizes the first month of a new quarter’s trade deficit for purposes of
estimating impact on the quarterly trade deficit, major disruptions from the GM strike are taken into
account here.
Graph 16a reflects the annualized estimate of the GM-disrupted narrowing of the October trade deficit,
but offsetting changes can be projected for the full quarter, as reflected in Graph 16b, which should align
more accurately with the Fourth-Quarter 2019 GDP estimate of Net Exports.
Graph 16a: Real Trade Deficit, 1q1994 to Early 4q2019 (Reflecting Only GM-Strike Disrupted October Level)
0
10
20
30
40
50
60
70
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90
10 0
-1,200
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0
Billio
ns o
f C
hain
ed
2012 D
ollars
Real U.S. Merchandise Trade Deficit (Census Basis) Quarterly Deficit at Annual Rate, 1994 to Early 4q2019 (GM Impacted Oct)
Seasonally-Adjusted [ShadowStats, Census]
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 18
Graph 16b: Real Merchandise Trade Deficit, 1q1994 to Full 4q2019 (Estimated Impact from End of GM Strike)
Graph 17: Net Exports of Goods and Services (GDP Accounting) 1q1994 to Third Quarter 3q2019
0
10
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90
10 0
-1,200
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202
0
Billio
ns o
f C
hain
ed
2012 D
ollars
Real U.S. Merchandise Trade Deficit (Census Basis)
Quarterly Deficit at Annual Rate, 1994 to Likely Full 4q2019) Seasonally-Adjusted [ShadowStats, Census]
0
10
20
30
40
50
60
70
80
90
10 0
-1,100
-1,000
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0
Billio
ns o
f C
hain
ed
2012 D
ollars
U.S. Net Exports of Goods and Services (GDP Accounting) Quarterly Deficit at Annual Rate (1q1994 to Second Estimate 3q2019)
Benchmark-Revised, Seasonally-Adjusted [ShadowStats, BEA]
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 19
Consumer Needs and Finances
Consumers Drive the Economy, but They Need Income and Credit Growth to Expand Activity.
Graph 18 plots headline real average weekly earnings back to 1965, as published by the Bureau of Labor
Statistics. While headline U.3 unemployment purportedly is at a headline 50-year low, headline real
average weekly earnings remain below where they were in the late 1970s. You do not want to look at it,
net of adjustments for inflation reporting gimmicks over the same period (ShadowStats-Alternate
Inflation adjustment, orange line).
Graph 18: Real Average Weekly Earnings – Production and Nonsupervisory Employees
With any luck, headline inflation-adjusted consumer credit can make up any difference in real income
shortfall. Yet, as broadly measured by the Federal Reserve, the inflation-adjusted level of Consumer
Credit never has recovered its pre-Great Recession high, still shy minimally by 10% (-10%). Is there
something here the FOMC could do to help the consumer? Nothing further is needed with ―sustainable,
moderate economic growth.‖
0
1
2
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7
8
9
10
140
160
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360
1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020
Co
nsta
nt
1982-1
984 D
ollars
Real Average Weekly Earnings - Production and Nonsupervisory Employees
Deflated by CPI-W versus ShadowStats-Alternate (1990-Base) 1965 to October 2019, Seasonally-Adjusted [ShadowStats, BLS]
Official Recession
Real Earnings Adjusted for Headline CPI-W
Adjusted for ShadowStats-Alternate CPI-W
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 20
Graph 19: Real Consumer Credit Outstanding (Ex-Federally Held Student Loans)
Smoothed 12-month moving average to October 2019 remains shy by 12.0% (-12.0%) of regaining its June 2008 peak.
The later peak here, versus Graph 20, is due to using a 12-month smoothed moving average.
Graph 20: Total Real Credit Market Debt Outstanding, Household Sector
Second-Quarter 2019 remains shy by 10.0% (-10.0%) of regaining its Third-Quarter 2007 peak.
0
0.1
0.2
0.3
0.4
0.5
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2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Ind
ex o
f R
eal
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nsu
mer
Cre
dit
,
Ex-F
ed
era
l S
tud
en
t L
oan
s, Jan
2000 =
100
ShadowStats Index of Real Consumer Credit Outstanding
Ex-Federally Held Student Loans (Deflated by CPI-U) Unadjusted by Month and Smoothed with a 12-Month Trailing Average To October 2019, Not Seasonally Adjusted [ShadowStats, FRB, BLS]
Recessions
Ex-Federally Held Student Loans
12-Month Trailing Average
0
10
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30
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10 0
100
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2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Ind
ex L
ev
el, F
irst-
Qu
art
er
2000 =
100
Household Sector, Real Credit Market Debt Outstanding Deflated by CPI-U. Indexed to First-Quarter 2000 = 100
To 2q2019, Seasonally-Adjusted [ShadowStats, FRB Flow-of-Funds, BLS]
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 21
Federal Reserve Activity
The Fed Has Been Pumping Some Cash Into the System. On the plus-side of FOMC activity,
November 2019 Money Supply M3 annual growth jumped to 8.5%, its highest level since February 2009,
with the narrower M1 and M2 measures both topping seven percent.
Graph 21: Nominal Annual Growth, Money Supply M1, M2, M3 – Official and ShadowStats Continuation
After dumping its systemic bailout assets in recent years, in the context of its new non-Quantitative
Easing QE, the Fed has been buying assets, albeit minimally, as can be seen in accompanying Graphs 22
and 23, of the level and annual change in the St. Louis Fed’s measure of the Adjusted Monetary Base.
Positive movement in both areas should have some positive economic impact in the year ahead.
[Graphs 22 and 24 follow on the next page.]
Shadow Government Statistics — Bullet Edition No. 15 — December 8, 2019
Copyright 2019 Shadow Government Statistics, Walter J. Williams, www.shadowstats.com 22
Graph 22: St. Louis Fed Adjusted Monetary Base – Bi-Weekly, Level, 2000 to Date
Graph 23: St. Louis Fed Adjusted Monetary Base – Bi-Weekly, Year-to-Year Change, 2000 to Date
# # #
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500
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ollars
St. Louis Fed Adjusted Monetary Base - Bi-Weekly Level in Billions of Dollars, December 29, 1999 to December 4, 2019
Seasonally Adjusted [ShadowStats, St. Louis Fed]
-40%
-20%
0%
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ear
% C
han
ge
St. Louis Fed Adjusted Monetary Base - Bi-Weekly Yr-to-Yr Percent Change Dec. 29, 1999 to Dec .4, 2019
Seasonally-Adjusted [ShadowStats, St. Louis Fed]