[dude1394]

Here is the link to the NYPost in the above article. Pretty good prognosticating, I think I should figure out what stock this guy's buying. Again I'm not trying to "make" a point as much as understand what is occurring. From everyone in business I talk to business is great. We personally are headed for 25% profit sharing. It makes you go hmmm....

August 5, 2004 -- WALL Street thinks the gov ernment will report strong U.S. job growth tomorrow.
I think Wall Street is wrong.

The consensus is that the Labor Department will saythat anywhere from 215,000 to 300,000 jobs were created in July when its report is released before Friday's opening bell.
Experts had predicted good growth in June but the actual number was a not-so-stellar gain of 112,000 jobs — less than half of what had been expected.
The guessers apparently think some of the jobs that didn't show up in June will suddenly appear tomorrow.
With only two more monthly reports due before the election, tomorrow's number is obviously politically important.

But this report is just as vital for Wall Street because other reports are showing a slowdown in economic growth, an inconvenient development for a stock market that is already expensive. Here's my theory — and I emphasize the word "theory" — on where I think Wall Street will be wrong on the jobs figures.

Last year the government reported that the economy lost 44,000 jobs in July.

Included in that figure was a guess by the Labor Department that so many companies quietly went out of business that they took 83,000 jobs with them. You could look it up: http://www.bls.gov/web/cesbd. htm. Without that guess, the economy would have gained — rather than lost — jobs last July.

In other words, the Labor Department's so-called Net Birth/Death Adjustment tabulates July as one of only two months in which there are more companies dying and taking jobs away than creating new jobs.

The other month is January, when Labor takes out a massive number of jobs because it assumes a large number of companies die off after Christmas.

I assume the White House doesn't understand these assumptions because the small jobs gain in January — helped by these assumptions — set off a massive amount of administration bellyaching.

But the White House was quite happy when these assumptions reversed in the spring and hundreds of thousands of guesstimated jobs were added to the monthly count.

Unless the Labor Department deviates from its previous assumptions this July, the economy will have to have created an awful lot of jobs to get over the statistical hump and meet Wall Street's forecast.

Or, the jobs will have to suddenly appear.