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Previewing Today's 1.5 Million Payrolls Seasonal Adjustment

Tyler Durden's picture


Today's consensus estimate for the non-farm payroll is for a 149K increase broken down as follows among some select banks:

  • Bank of America 115K
  • Deutsche Bank 120K
  • Goldman Sachs 125K
  • Citigroup 135K
  • JP Morgan 140K
  • Barclays 150K
  • UBS 165K
  • HSBC 167K

Why is the expectation so low? Why cold weather of course - the same cold weather that supposedly impacted December and January data. Then again, one wonders just what is the seasonal adjustment factor for if not to adjust for the, gasp, seasons.

So when one puts the February actual number in the context of its average adjustment over the past decade, what does one get? Simple - a boost of 1.5 million "jobs" which exsit nowhere in the real world but in some Arima-X-13 spreadsheet.

The chart below shows what the average seasonal factor by month has been in the past 10 years.

In other words, today's entire pick up in jobs is one tenth of the overall seasonal adjustment factor, which as we know by now is woefully broken since it is so incapable of grasping the simple concept of cold and snow in the winter.

And now you know why today's number is once again meaningless and only there to stimulate HFT algos into buying whether the news is good or bad.


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Fri, 03/07/2014 - 09:24 | 4520647 BudFox2012
BudFox2012's picture

I guess if they set their expectations low enough they won't be dissapointed.

Fri, 03/07/2014 - 09:26 | 4520657 Divided States ...
Divided States of America's picture
  • Bank of America 115K
  • Deutsche Bank 120K
  • Goldman Sachs 125K
  • Citigroup 135K
  • JP Morgan 140K
  • Barclays 150K
  • UBS 165K
  • HSBC 167K

Does it fuckin matter??? I know the only sure thing is Dow +150pts

Fri, 03/07/2014 - 09:29 | 4520670 ArkansasAngie
ArkansasAngie's picture

Fundamentals don't matter.  Jobs don't matter.  Right from wrong doesn't matter.


Fri, 03/07/2014 - 09:32 | 4520678 Headbanger
Headbanger's picture

Because Obama

Fri, 03/07/2014 - 09:34 | 4520688 onewayticket2
onewayticket2's picture

obama's minimum wage increase will kill 500k jobs says the CBO.....

Fri, 03/07/2014 - 09:36 | 4520690 SoilMyselfRotten
SoilMyselfRotten's picture

Dollar down, gold slammed, sure, why not?

Fri, 03/07/2014 - 09:37 | 4520699 TeamDepends
TeamDepends's picture

Silver worth 2% less than it was 5 minutes ago.  Makes perfect sense.

Fri, 03/07/2014 - 09:43 | 4520745 Winston of Oceania
Winston of Oceania's picture

No just the worthless script that people keep confusing with actual money. Measure yor metals in weight only and the noise dies down a bit.

Fri, 03/07/2014 - 09:36 | 4520696 Wait What
Wait What's picture

175k! booyaaah!! bubble on baby, bubble on! let's see if we can't get the Fed to panic and cut 20billion at the next meeting!!

Fri, 03/07/2014 - 10:58 | 4521066 elwind45
elwind45's picture

Standing on the corner watching all the jobs go by

Fri, 03/07/2014 - 09:29 | 4520654 B2u
B2u's picture

Did they get the memo from Obama?  Gotta have a good number for all those people signing up for Obamacare...they gotta have money to pay for their "FREE" healthcare.

Fri, 03/07/2014 - 09:28 | 4520665 Dr. Engali
Dr. Engali's picture

The only job that concerns me is the elusive blow job after 16 years of marriage. I've lowered my expectations too.

Fri, 03/07/2014 - 09:31 | 4520677 negative rates
negative rates's picture

Here, you can have one on me.

Fri, 03/07/2014 - 10:23 | 4520945 Pairadimes
Pairadimes's picture

What's the difference between a new job and a new wife after 6 months?

The job still sucks.

Fri, 03/07/2014 - 09:29 | 4520669 thismarketisrigged
thismarketisrigged's picture

i swear futures go higher regardless.

new month, same bullshit

Fri, 03/07/2014 - 09:31 | 4520676 Divided States ...
Divided States of America's picture

Bingo amigo

Fri, 03/07/2014 - 09:30 | 4520672 disabledvet
disabledvet's picture

well..."the markets will do what the markets will do" too.

"blame it on the jobs market" would be ironic indeed.
Food prices have definitely shot up here locally "and we are a big food producer" up here. Same is true for Pennsylvania.

Obviously the latter is a staggeringly large producer of energy, coal and steel as well.

Fri, 03/07/2014 - 09:31 | 4520674 nantucket
nantucket's picture

175k, ha ha ha

Fri, 03/07/2014 - 09:33 | 4520680 Rising Sun
Rising Sun's picture

When that cunt Yellen stops pumping $65B (leveraged 40X) per month into these bloatus markets, reality will set in.


In the meantime, Yellen has menopause again - and as we all know, this is bullish.


S&Ps up 1% today.

Fri, 03/07/2014 - 09:33 | 4520681 thismarketisrigged
thismarketisrigged's picture

and sure enough futures r higher, shocker.


175,000 is being made out to be like we r in a golden age, how amazing how low expectations have become

Fri, 03/07/2014 - 09:36 | 4520684 Save_America1st
Save_America1st's picture

I see that the monkeys are hammering away at the PM's early this morning.  Are they front-running some bad numbers today in anticipation of a PM's spike after the bad news comes out, so they're hammering them down now before the open????

Fri, 03/07/2014 - 09:36 | 4520695 Divided States ...
Divided States of America's picture

Looks like it dude by the 10 year is creeping back up of late also (2.8% now)....and with Oil over 100 and other food commodities up here too now...PLUS Yuan and Ruble weaker now too...something just dont jive here.

Fri, 03/07/2014 - 11:52 | 4521291 Save_America1st
Save_America1st's picture

well...whatever the reason for the early morning Friday beat-down, I'll take it!!!

We got us another sale on phyzz, folks, so stack up. 

Fri, 03/07/2014 - 09:35 | 4520687 Proofreder
Proofreder's picture

WTF is going on with spot Gold ???   Down from 1350 to 1339 in seconds.  Large contract must have changed hands at 8:30 EST.

Anyone ???

Fri, 03/07/2014 - 09:36 | 4520694 Dr. Engali
Dr. Engali's picture

hah 175 K. Lowered expectations  are easy to beat. 

Fri, 03/07/2014 - 09:38 | 4520707 youngman
youngman's picture

How many ghost jobs did they create

Fri, 03/07/2014 - 09:40 | 4520725 Bill of Rights
Bill of Rights's picture

Isn't it funny how Gold gets monkey hammered none stop and yet the DOW, SPY and so on the  losses are contained, what a fucken joke this all is.

Fri, 03/07/2014 - 11:03 | 4521092 elwind45
elwind45's picture

Last falls footings are ready for the framing or interest is not what your parents paid even if it goes up your rate is fix DONT WORRY THIS IS THE VERY BEST TIME EVVVVVER

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