“Lipstick on a pig” is probably one of the more disgusting phrases that has made it into common usage. Leave it to one of the most off-putting, obnoxious individuals in financial television, Rick Santelli, to give us a quintessential example of this tasteless descriptor of putting a smiley face on a bad situation.
Today’s main “taper topic” was the August employment report and how it could impact Fed decision-making. The consensus estimate for job additions was 180,000. The number came in at 169,000 (the whispered number was 200,000). It was a miss, not big one, but still a miss.
Oh the wailing and the gnashing of teeth, none was more outspoken than Mr.Santelli, CNBC’s bond savant. To demonstrate, I’m an attaching two links: one to a Santelli piece, and a second link to a debate (rant) with economics editor Steve Liesman (one of the network’s more balanced and knowledgeable presenters).
In the first clip Santelli attacks Secretary of Labor, Thomas Perez, for his more positive interpretation of the data (i.e. lipstick on pig) (Santelli Exchange) . In the second he attacks Liesman’s assertion that “Baby Boomer” retirements may be understating the labor force participation rate. He also believes retired “Boomers” won’t have spending money with which to support the economy. Rick, please tell my wife!
These reports were hard to watch. Both were typical Santelli, misleading and downright mean spirited (obnoxious, if you consider the L.O.A.P reference).
Santelli went after the labor participation rate. At 63.2% it is the lowest in 35 years. This rate includes retirees. When workers retire they are counted among those who are no longer looking for work. This is idiotic. When they leave the employable pool, assuming employment remains the same, the unemployment rate goes down, which it did (from 7.4% to 7.3%). Santelli calls this bogus, because it reflects both discouraged workers and retirees (all he believes to be indigent) who leave the pool.
Liesman was trying to argue (before Santelli shouted him down) that 10,000 “Boomers” reach retirement age every day (about 3.65 million per year). Many don’t retire, but if only 1.2 million retire each year that would be a monthly 100,000 subtraction from the pool. When you consider this, the 169,000 new jobs and 63.2% labor participation rate doesn’t look so bad. “Lipstick on a pig?” I think not.
Santelli’s ‘lipstick’ remarks are not funny. His assertions do not accurately reflect the current U.S. economy. This has been a constant in his work. Finally, his lack of civility is not conducive to true debate or understanding.
What do you think?
PS. The Heartland got the bad news Saturday, September 7…K. C. Star (my hometown paper) lead story–“AUGUST JOBS REPORT/Gains smaller than expected–TEPID HIRING CLOUDS PICTURE
Fed could be less likely to curb stimulus. Unemployment dips to 7.3% because people quit looking.”
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