Courtesy of Mish.
Once again, on Tuesday, I had the pleasure of being on Capital Account, live television with Lauren Lyster.
We discussed IMF downgrades, unemployment, conspiracy theories, and economic outliers. We also discussed my proposal in regards to the proper way to measure the unemployment rate.
I come in at about the 3:40 mark, but the first few minutes of Lauren are entertaining as usual.
Link if video does not play: Mish on Capital Account.
A New Way to Measure Unemployment
On Monday, in the wake of a controversial drop in the unemployment rate, Gallup Economist Dennis Jacobe proposed a A New Way to Measure Unemployment.
He proposed “Payroll to Population (P2P) — the number of Americans employed full-time for an employer as a percentage of the U.S. population.”
Jacobe’s proposal is horrendously flawed. The reason is demographics. Should a someone 80 years old, retired, and does not want a job be considered unemployed?
They would be in Jacobe’s model. Simply put, P2P has fatal demographic flaws.
Simple Unemployment Rate Construct