Iraq Reconstruction April 2007 Report to Congress

From the Special Inspector General for Iraq Reconstruction's April 2007 report to Congress, here are some useful trend charts selected from their List of Figures page.

You can click on each chart for a larger, better view.

In this first chart, it would be interesting to break out the trend for imports separately so it could be seen more clearly.


This second chart shows substantial deterioration in average electricity load served over the past year.

In this third chart, it would again be good to separately break out the trend data for Oil Production in the North and the South to make the trends in each of these areas more clearly visible. Stacked charts often obscure the most important underlying phenomena taking place with the individual factors. A separate chart showing the percentage of total oil production accounted for by the South would also would likely be revealing.

In this fourth chart, export levels for crude have recovered to their target value in March 2007. It will be interesting to see how they progress from here on out.


In this final chart, it would be helpful in my view to show each of these factors as a separate bar chart so that the trends at work with that factor could be instantly grasped. This kind of multi-factor bar chart is much harder to understand and interpret since the trends for each factor are interspersed with bars from the other factors. When shown individually, the downward trend for each of these factors would instantly discernible. Showing data points one year apart is also not nearly as good as if each trend had been shown with month by month data points.

WSJ Housing Inventory Trends

Check out this Wall Street Journal Interactive graphic showing changes in housing inventory in the past two years. It has some useful and novel features that make exploring the 18 different cities and 3 different regions easier over the past 20 months.

Here's one of the more interesting charts that I created in just a few minutes of exploration.


For the six cities shown (Miami, Orlando, Chicago, Las Vegas, Los Angeles and Phoenix) the upward trends since October 2005 are plain to see.

Try it out yourself and see what you can discover.

Here are my thoughts on the pluses and minuses of these interactive chart features

On the plus side

1. A single click selects a new factor to add to the mix of factors already selected for the chart

2. When adding a new factor into the mix, it highlights that new factor on the chart and reduces the intensity of the other factors on the chart until you move the mouse over the chart again when all factors selected come into full view. This helps you lock in on the colors for the new factor before they become blended with the other factors.

3. When you move the mouse over the check box for a factor that has already been selected, that factor is highlighted against the other factors currently selected with a little pop up text box that tells you the current inventory value exactly.

4. A single click as all that's required to de-select a factor.

5. A single click for one of the three areas (East, Central, West) selects all the factors for that area. And once a whole area has been selected, a single click de-selects all factors currently checked.

6. All of the above pluses add to ease of use and time saving when exploring this data set for the most interesting and telling patterns.

On the minus side

A. Way too short a time range. To make full sense of these trends and put the recent behavior in perspective needs at least 5 years and preferably 10 to 25 years of history.

B. Some major cities that are in the top 10 in population are missing - New York, Philadelphia, and San Antonio.

C. No way to adjust Y axis scaling. This is a serious drawback. The scale runs from zero to 110 thousand which is fine for viewing the trend for Los Angeles which has a range between 45, 000 and 103,000, but it makes it difficult to grasp the trends for such cities as Minneapolis which varies from 25,000 to 31,000 or Baltimore which ranges from 5,000 to 10,000. Both of these cities look flat line during this period even though when you examine them closely they really aren't. Y axis scaling options such as the possibility of calculating the Min-Max scaling for the factors charted would help bring the trends for all cities into clear view.

D. No available view of the data using percentage change from a baseline value for determining the Y axis value. Such a normalizing option would simplify comparisons between cities.

E. No option for showing aggregate results for a region or for stacking the factors selected.

F. If you wish to look at each factor separately, it takes two clicks. One to de-select the previous factor, and one to select the new factor.

G. No option for smoothing with features such as moving averages

H. Missing trend data for other related factors for each city such as

• Inventory breakdown by New and Existing housing
  
• Average number of months houses have been on the market (total, new, existing)
• Median selling price in that market (total, new, existing)
• Rate of sales per month in that market (total, new, existing)
• Number of months of inventory at current sales rate (total, new, existing)

I. Missing option for downloading the underlying data set thereby enabling further analysis.

Hat tip to Barry Ritholtz at The Big Picture

The Big Picture | Some More Housing Charts

Barry Ritholtz does it again with this excellent post which contains 4 excellent and easily readable charts on the trends affecting the housing market.

This time, Barry tells the story using pictures without commentary. The charts he selected are excellent and speak for themselves without commentary. However, Barry always adds something to the mix when he adds in his thoughts and perspectives and experience on what he sees in the charts and what it is most likely to mean.

Barry does give us a money quote with these few words to wrap up his post:

Funny thing: The charts tell pretty much the same story the words did: The housing story is only halfway done, going to get worse as time progresses. We are not anyway near a bottom in Residential Real Estate.

I do miss the words, so here are copies of the charts accompanied with my ordinary citizen, non-housing-expert comments on what they might be telling us and focusing on the degree to which these charts make best use of best practices for conveying trend results graphically.

This first chart is both interesting and scary. It would have been great to see what the Reset Amounts have been for the past 10 or 20 years rather than just the past 4 or 5 months. If I am reading this correctly, it sure looks like we are into a 12-18 month period with extremely high reset amounts, where a very small percent are for Prime ARM. Note that this chart is originally from Credite Suisse via Lamont Trading Advisers to At These Levels and then to The Big Picture.

Stacked bar charts are often difficult to use to interpret the behavior of the sub components such as Unsecuritized ARMs. Important trend information about these sub factors may be hiding in a chart such as this. My own preference in these cases is to use individual charts for each factor that I consider important so I can understand the individual behavior AND the composite behavior of all these factors.

This 3 year chart originally from Northern Trust is plain as day. Having the 20 or 25 year chart for this same key factor would have made this even better and clearer and more useful. Some smoothing, maybe a 3 month average could also be helpful here. It's important to note that this chart is based on combining two other factors - the actual total inventory of homes, and the most recent rate of sales of existing homes. For reference, having charts for these other two factors to look at in parallel to this calculated metric would also be useful.


This next chart gives us a nice 20 year view. having a complementary 3 year view would let us look more closely and better understand the very sharp recent spike.


For this next chart, my own preference would be to look at these two factors separately on their own chart first using a 20 to 25 year view.



As a general comment, having a shifting time window for every chart makes things much more difficult on the viewer.

Housing Freefall Continues Unabated

You can find some more good charts and commentary on Housing from Barry Ritholtz over at The Big Picture.

Here's the first chart. You won't be surprised to learn that I like the long time sweep. However, this also looks like a case where having a second, shorter term chart - maybe for the past 3 years would help us better understand the more recent behavior


In contrast, the second chart shows just the 3+ year view and presents that very well. Having a 20 year year to match the first one would have been even better.

The whole article is worth a read for the extra perspective it brings.

St. Louis Fed - National Economic Trends - June 2007

The newest edition of the always excellent National Economic Trends is available today from the St. Louis Fed.

Here are a sampling of the charts that caught my eye. Click for larger size version.

From their engaging cover article, this first chart shows the percentage of the population age 55 or over engaged in part time employment. The upward trend for women is particularly clear. The article discusses possible causes and notes areas for follow-up investigation.


This next chart shows trends in national income as a percentage of GDP.

Corporate profits weighs in at almost 14% of GDP and is close to the recently set 25 year highs. This is approximately double where it was in 1982.

Proprietor's Income registers at almost 9% of and it also is close to its 25 year highs. This is almost 50% higher than it was in 1982.

Compensation at a little over 64% of GDP is close to its 25 year lows. This is down approximately 3% from the 67% level of 1982.

The remaining National Income components (not shown) must by deduction be down net 7% from about 20% to 13%.


This third chart shows pretty clearly that the rise in corporate profits before tax is directly reflected in the rise in after tax profits as a percentage of GDP. After tax profits have more than doubled since 1982 from 4% to over 8%.


The fourth chart shows that the current account balance is close to its 25 year low at approximately 6% of GDP. Note the striking and steady downward trend since 1991.

And this final chart is noteworthy for the clarity with which it shows the rise of debt service payments to approximately 14.5% of personal income - close to the highest levels in 25 years. The steady upward trend since 1992 is also clearly visible.


Commentary.

1. As I mentioned in previous posts, one of the reasons that I value the St. Louis Fed's monthly National Economic Trends report is their use of long term trends. These help put the current behavior into perspective. The charts I have selected offer a glimpse at how a 25 year trajectory adds understanding to the most recent behavior.

2. That's not to say that their monthly report couldn't be improved. Here's my short list of suggestions on just how that might be done.

• Show all selected factors using the same long term 25 year time frame trend chart as the default setting and template.
• Show each factor on its own before combining it with other factors in a dual chart. The dual chart approach while extremely helpful for showing the possible relationship between a set of factors and simplifying comparison sometimes obscures the underlying trend in some of the factors due to the Y axis scaling used.
  
• For the single charts created for each important factor, consider using MIN-MAX scaling for the Y axis rather than zero based scaling as the default. This is not correct in every instance but it often proves useful in helping make the trend patterns easier to read and understand.
  
• Add at least some minimum commentary (could be 25 words or less) with 20% of each month's set of charts. Add comments for the charts that the St Louis Fed considers to be the most interesting and which have some interesting pattern to observe. E.g. follow the example we have set with the selected charts above. A picture is worth a thousand words, but not every important nuance seen by the expert creators of these charts will register immediately with every viewer, especially to non-expert viewers.
  
• Make it easy to download a cross-tabulated table of all the data contained in all the charts for further examination by interested parties.

Charting Progress in Iraq

This topic of determing how things are going on the ground in Iraq seems to be heating up in the last few days. See for example, Sheryl Gay Stolberg's New York Times article from May 13th - See You in September, Whatever That Means where she says:

There’s just one problem. Nobody in Washington seems to agree on what progress actually means — or how, precisely, it might be measured.

While I don't agree with that premise, the article opened up the door to a ton of worthwhile commentary - much of discussing possible factors that might be useful to gauge how things are going.

Another recent contribution to this topic was David Peck's Christian Science Monitor Article on why we need yardsticks for both success and failure in Iraq. David skillfully maps his experience with coaching leaders onto the pressing leadership issues involved in our presence in Iraq. The money quote of this article for me was:

there has never been agreement on the status of the war in Iraq because there are no agreed-upon measurements.

For some perspective from a couple of years back, and maybe to help understand how much or little forward momentum we are making in talking about progress, I also suggest you take a look at this Dan Froomkin article on Nieman Watchdog from a couple of years back (May 2005): Isn’t there some way to tell if we're winning or losing in Iraq?


We've delved into this topic in previous posts (see: Most Important Iraq Data) and we plan to revisit it again soon based on these new inputs and what seems to be a growing interest in the topic.

And of course in our opinion since what gets measured gets done and what doesn't get measured doesn't get done, this particular topic is of particular importance and relevance right now.

Hat tip to Dan Froomkin for pointing out both the referenced NY Times and the CS Monitor articles in his White House Watch Blog.

James Durso's Iraq Reconstruction News

Here's a link to an essential resource for keeping up with the trends regarding what's happening on the ground in Iraq. It's the new Iraq Reconstruction News blog created by James Durso. The links that this blog provides are to detailed resources that go far beyond the reporting one might find in the mainstream media. As I have been exploring different and complementary sources of trend data, these updates that James provides have been particularly helpful for me in locating new sources of data.

The focus of this blog is particularly on the Reconstruction aspects in Iraq. The links however often provide excellent depth on a whole host of other related topics.

James also puts out a regular set of email updates covering the same material for those who would prefer to get their news in that manner. You can find his contact info on the blog site.

Latest Brookings Iraq Index - Key Factors for Gauging the Success of the Surge

Here's the link that will always get you to the latest edition of the highly useful Brookings Institution Iraq Index that is one of the best places that I know of for learning about the trends on the ground in Iraq.

In the April 30th, 2007 edition, there is a useful essay on "Tracking the Surge" on page 4.

Unfortunately, the charts and tables that follow for the most part do not match up with the key factors noted in the essay, nor do they make it easy to for interested citizens to see the trends at work for themselves.

Here are some of the key factors that I gleaned (scraped) from the text.

1. number of US brigades in place
2. number of "joint security stations" established
3. extra-judicial killings
4. level of civil warfare
5. willingness of Shia militias to lie low
6. willingness of Sunni tribal leaders in al-Anbar to collaborate in opposing al Qaeda
7. level of violence in al-Anbar
   
8. daily attacks in and around Ramadi
9. resilience level of al Qaeda and related terrorist elements
   
10. rate of use of vehicle bombs
11. rate of use of vest bombs
12. percentage of casualties that are Shia
13. progress on the hydrocarbon law through the Iraqi parliament
14. progress towards reforming de-Bathification to allow return of lower level Baathist to public life
15. state of the Iraqi economy
16. Oil revenue received
    
17. Foreign aid received
    
18. Money available in federal coffers
19. Performance level of public utilities (presumable electricity, water, sewerage, sanitation, petrol supplies, public transportation)
20. How well schools are functioning
21. The overall state of the health system infrastructure
22. Level of unemployment

That's an awful lot of important metrics for one page of text and Michael O'Hanlon and the Brookings Institution deserve praise for consistently working to get their arms around the vast multi-dimensional range of factors at work.

And, reviewing the whole report, there are literally dozens of other important factors that show up in charts or tables.

Wishlist 1: It would be really valuable if one could turn the page of the Iraq Index report and see the chart or charts for each of the these items one by one, in the same sequence as they appeared in the essay and with the same terminology, so as to get a sense for the degree of progress that is being made, to see which things are lagging, to see what is getting worse and by how much, and so on.

This, in my mind would provide a giant step upward in the usability and the understandability of the important work that provides the basis for these weekly reports.

Comment: Many of the tables and charts in the weekly report are out of date. They represent important factors but no new data has been available to update them for quite some time.

Wishlist 2. It would be helpful if outdated tables and charts were either placed in an appendix, or if the chart could be updated to show the current end date and the missing data. Otherwise it is easy to misread the right hand side of the charts to think that the data and the trends represent the past few weeks or months instead of sometime in June 2006, or May 2005.

Comment: The chart formating for just about every chart is different and each chart seems to have its own unique starting and ending time intervals.

Wishlist 3. A move to more consistent chart formats and time intervals would greatly enhance the readability and usability of these reports.

BLS Compensation Report

The latest Bureau of Labor Statistics report on wages and benefits includes these relatively easy to read charts that highlight the employment compensation trends over the past 6+ years. The moderately long time frame makes it easy to detect patterns and compare recent behavior to the situation at the turn of the century.



With the second chart, using the non seasonably adjusted numbers for the percent change over 12 months makes a lot of sense.

The red lines in the 2nd and 3rd charts plot the same metric. The blue line converts those wage gains to constant dollars and makes pretty clear how little this has changed over the past 6 years.

It would have been nice to see the total compensation chart including wages and benefits adjusted to constant dollars.

Looking behind the headline number.

Here's a good example of the power that acrues the minute that we begin to look behind the headline number and see what other factors might bear on the meaning of what we are seeing.

The Big Picture Watching Trading Volume Fade . . .

In this case, insteaed of just looking at the S&P 500, Barry Ritholtz points us to a Michael Kahn Barron's article where he takes a look at the volume as well and discovers some interesting patterns.

What other factors might be worth adding into the mix and giving us even more depth of understanding of the basic workings of this important headline financial indicator?

For example, it would be interesting to see what percentage of the S & P volume was NEW short sales and what percentage of the volulme was Covering Purchases for previous short sales.

It might also be worthwhile to look at the average number of shares per trade which might give a clue into what percentage of the volulme was due to large financial instituions and what part was coming from the "little guy."

New Development at the St. Louis Fed

Here's the latest on a nice new development from the St. Louis Federal Reserve.

St. Louis Fed: March 2007 Tip of the Month

It's now possible for registered users of their FRED database to create, name and save customized graphs that can then automatically be updated on later visits to the site. Looks like a great feature.

Monthly trade deficit

Another great chart from Calculated Risk

You can find the full post here

Chart of the Day - www.chartoftheday.com

Here's another nice chart from Chart of the Day - www.chartoftheday.com

On the plus side we have the complete time range and the use of the derived value of the inflation adjusted DOW as the variable to watch rather than the Headline raw DJIA value. In my view, the inflation adjusted number really should be the Dow value that we watch for the same reasons that we use inflation adjusted numbers everywhere else.

Historical Bear Market Contractions

Barry Ritholtz continues his track record at finding and sharing interesting and useful charts that provide new perspectives at looking at important data. You can find the full post at:
The Big Picture Historical Bear Market Contractions

I liked the creative way that the width of the bars in this chart shows the second dimension of length of the contraction period.

An Old Fashioned Trend Visualization Appliance

And speaking about the excellent Calculated Risk Blog, I would like to point out the following exemplary post on the Housing market.

Using just the ordinary blog posting mechanism and the ability to embed JPG pictures as the Trend Visualization Appliance, the resulting article has a high degree of explanatory power and immediacy. You can literally see what Calculated Risk is talking about as you read as a result of the great blend of clarifying text with the easy to read trend graphics in close proximity.

Not relying on the normal conventions of providing only one or two graphics for headline numbers, Calculated Risks walks us through a series of 6 or 7 less well known but still key factors. This leaves the reader/viewer which a much more complete view of the dynamics that are at work in this one complex area.

Combine this with good references back to data sources and consistently good judgment on what would constitute a reasonable time frame, leaves with a very useful end result that provides the reader with the maximum amount of infomation in relatively short period of time.

The only difficulty with this is the same one I face with this TimelineView blog -- namely that as a limitation of BLOGGER.COM the largest allowed size of the embedded images is just too small to be fully readable and understandable in most instances. To really understand the charts, at least at first, usually requires clicking for the larger image and then using the browser navigation controls to go back to the main page. This really slows down the flow of reading and understanding.

I think we can all learn a lot by watching how Calculated Risk handles these kinds of presentations. Take a look at the post or other similar posts that appear regularly at Calculated Risk and you will see what I mean.

The Importance of Mortgage Equity Withdrawal (MEW)

Another hat tip to Barry Ritholtz in his post on The Big Picture The Capital Commerce Debate this time highlighting some eye opening and vital data about MEW (Mortgage Equity Withdrawal) using charts from courtesy of CalculatedRisk.

You can find a very recent Calculated Risk article here with comments on the debate between Barry Ritholtz and Don Luskin and a clarification of the meaning of the second chart here.

Business Capex - Another Nice Chart

Hat tip again to Barry Ritholtz who regularly posts some charts well worth looking at as with today's post on: The Big Picture Business Capex Rolling Over

It sure does look like capital spending has turned a big corner.

The chart is courtesy of Bob Bronson. You can find some more of Bob's posts here.

For reference, here's is a similar chart from about 6 months ago.I found it interesting how well Bob's analysis back in October, before the raw data turned the corner, was able to predict the recent changes in Capex.
I also like the way Bob has integrated textual explanations and graphical pointers right in with the charts themselves.

The only negative point I see with this presentation is that the dates are hard too read clearly.

Iraq Trend Data Set now posted to Swivel and Many Eyes

A while back we mentioned the great new data sharing and visualization web site called Many Eyes and we pointed out an Iraq Trend data set we had uploaded so that others could more readily examine and analyze it.

We've recently come across another great new data sharing and visualization web site called Swivel and have uploaded the same data set there for comparison purposes at: http://www.swivel.com/data_sets/show/1004780.

Both Many Eyes and Swivel fall into a category I have started calling Trend Visualization Appliances. The amazing Gapminder work also fits into this category as do all the various stock market visualization tools currently available.

The old fashioned form of trend visualization appliances (e.g. a standard report including graphical output) can still be pretty useful when managed carefully. For further comparison, here is the link to a PDF report that graphically presents the same data - vizualizing-trends-ohanlon-testimony.pdf.

Similarly, for data sharing, the old fashioned URL links to csv files offer an alternative to the WEB 2.0 mechanisms such as Many Eyes and Swivel. Here's the Iraq trend data the old fashioned way: ohanlon-key-factors.csv

So many choices, so little time. How can we decide which is best for our purposes?

I'll be revisiting this topic, but for now, my own criteria for deciding which tools I will use at a given moment are:
1) ease of use,
2) shortness of learning curve, and
3) personal productivity and time saving -- the speed at which I can navigate through complex trend data sets to discover previously hidden patterns.

What do you think?

Digging into the Job Opening Data

As mentioned in the previous post, the Bureau of Labor Statistics makes detailed trend data available on all the key Job Opening and Labor Turnover Survey (JOLTS). You can take a look yourself at the BLS data page and then scrolling down to select one of the option buttons (e.g. for most requested statistics) for Job Openings and Labor Turnover Survey.

You can set the time period for the trend graphs created to be the entire time since the year 2000 that JOLTS data has been collected. Here are a few examples. It's somewhat puzzling to me why the Openings rate seems to be going steadily up from 12/2003 onward while the Hiring rate stays steady beginning around 12/2004.





There's a ton more data at the BLS web site. The biggest difficulty for me and I bet for others is just how time consuming and inflexible the BLS' trend visualization application (TVA) is to work with.

Job Openings and Labor Turnover Report

Here's the two reasonably readable graphs from this morning's JOLT (Job Openings and Labor Turnover) report from the Bureau of Labor Statistics (BLS). Looks like there has been a moderately strong trend at work in the job openings picture for the past 3 years.



As has been typical in the BLS formal reports like this, the time span is too short to be able to place recent behavior in context and the number of factors shown in visual form is far too few to fully grasp what is going on in the world of employment.

In the full monthly report itself which runs to 15 pages, there are numerous tables with literally hundreds of important factors. Unfortunately, these covering an even shorter two year time period with even fewer sample trend sample points per factor. This again matches the current BLS standard not-particularly-reader-friendly approach for their "printed" reports.

In my view, this standard BLS approach is far from the best way to present important trend data. All the time consuming work of searching for and extracting meaning is left to reader (which means in most cases it will never happen) or it is left to the expert pundits who will typically comment on a few of the sub factors that they find most interesting and perhaps present one or two charts.

Of course, back at the BLS web site, just about all the trend data for all the factors for all the time periods is available for those who have the time and skill to track it down.

Another Easy to Read Housing Chart

Here's another easy to read chart that I find attractive from Political Calculations' post on the Boom in Realtors. The long time sweep creates excellent perspective. It would be interesting to zoom in on the past 30 years for another view.

San Diego Mortgage Defaults & Foreclosures

Here's a nice crisp chart that I think is instantly understandable. I especially like the long time sweep so the most recent data can be put into perspective. You can find the full story at:
voiceofsandiego.org: Toscano... Motivated Sellers Abound


It would be nice to be able to flip through a series of charts like this for a sampling of strategic areas or state by state to be able to compare how the San Diego trends match up against other parts of the country.

Hat tip to Kirk for this post at Reasons Unbeknownst

The Battle for Baghdad - NY Times interactive graphic

Here's another New York Times graphic that provides some insight into the evolving situation.

Violence in Iraq - The Battle for Baghdad - New York Times

If you click on the Sunni Area, Shiite Area, and Green Zone labels in the upper right corner, the map will be painted with some subtle coloring that I found helpful.

The forward and back controls that that show you week by week changes did not work well for me, often not responding to my mouse clicks. The pull down menu worked better but of course is a lot more clumsy. A PLAY button with some speed control would have been really helpful.

The time span runs backward to February 11th so this chart doesn't allow comparisons of how post "surge" events relate to the pre "surge" situation.

Is the "Surge" working?

Here's a before and after the 'surge' graphic from this morning's New York Time article on: Patterns of War Shift in Iraq Amid Buildup of U.S. Force that sheds some light on the degree to which the "surge" is working.

Disaggregating the figures by area is helpful at clarifying better what is happening on the ground. For example, the increase in Baghdad deaths and Diyala deaths due to IED both look substantial while the drop off in total deaths in Anbar Province is also striking.

By selecting a 7 week Before Period and a 7 week After Period, this graphic sets up the possiblity of direct and straightforward Apples to Apples comparisons .

I would also have liked to see all the same key factors represented on this chart (such as Baghdad deaths by IED, Baghdad deaths by other causes, Anbar deaths by IED) also available as a week by week trend table and charts with the time frame stretching back to the beginning of the war so that the trends showing up in the current casualty levels could be put put into a broader context.

Of course, adding in other factors such as US troops wounded, Iraqi forces deaths and wounded, and Iraqi civilian deaths and wounded would give a much fuller picture of the degree to which the "surge" has so far changed things in Iraq.

Selective Perception, Cognitive Bias, & the Recency Effect

Barry Ritholtz has an excellent post this morning commenting on NonFarm Payroll (NFP) increase of 180,000 from yesterday's Bureau of Labor Statistics Employment Situation Report.

His comments on selective perception, cognitive bias, the "recency effect" and the soft prejudice of low expectations apply well beyond the NFP example.

Let's begin with a quick word on cognitive bias. Humans are guilty of this -- selectively perceiving and recalling what agrees with their world view. We are all guilty of this, and while we cannot escape it, being aware of it at least allows some measure of recognition, and perhaps, adaptation to the phenomena.

Let's use the NFP data as an example: Consider another bias, the Human tendency to overemphasize more recent data versus the totality of information and the overall trend. This is a cognitive bias known as the recency effect. Despite the overwhelming evidence showing this to be a generally weak jobs recovery (the worst since WWII), our primate brains interpret a single good data point as proof of something better. ...

Regardless, we also see some of the soft prejudice of low expectations in yesterday's data: 180k is hardly a rockin' strong number, relative to population growth,. Put that into the context of recent expansions such as the 1990s. Oh, and in that more recent period, there was no BLS Birth/Death adjustment, responsible for nearly a million fictitious jobs in 2006.

Unfortunately, the two trend chart he shows only go back three years (suffering themselves from the recency effect) so we can't compare the relatively weak current numbers to the NFP increases of the 1990s. The two charts shown in the Bureau of Labor Statistics Employment Situation Report also only go back 3 years.

So, below I have posted a 15 year view showing year over year percentage change for the seasonally adjusted value of the growth in NonFarm Payroll. It's pretty clear from this longer term chart that our growth in non-farm employment during this latest expansion never got back to the steady, multi-year 2.5% growth rate of the late 1990's and appears to be declining again.

Of course, in a subject area as complex as employment, an equally important danger in my opinion is the almost universal tendency these days to stick with just a few headline factors. If we truly want to understand employment, I believe we have to make it easy to visualize and then examine a full range of factors over a substantial time period.

For example, the recent drop off shown above does not seem to square with the reported drop in the headline unemployment rate. Maybe some other factor of the thousands of factors recorded by Bureau of Labor Statistics (BLS) can help explain it.

Too often, really important factors aren't mentioned at all, and the ones that are mentioned are not accompanied by their corresponding trend charts.

Here's a link to a short list of the most popular BLS statistics which might be a useful starting point for a deeper analysis.