UNEMPLOYMENT RATE DROPS, BUT DOES IT? – AT 8:42 A.M. ET:  New employment figures just came out, but the well-known devil is in the equally well-known details.  From WaPo:

U.S. employers added 113,000 private-sector jobs in December, the Labor Department reported Friday, fewer than analysts expected. But the unemployment rate dropped from 9.8 to 9.4 percent--the lowest level since May, 2009.

Economists had predicted that employers had created 150,000 net new jobs in December, and that the unemployment rate would drop to 9.7 percent. Instead, the overall number of jobs created was 103,000, the government said. But more people apparently also stopped looking for work, which accounts for part of the decline in the joblessness rate.

COMMENT:  Bit of sleight of hand there.  So, let's examine:  The economy picked up 113,000 jobs (some other sources have it at 103,000), about a third less than expected.  But, magic, the unemployment rate dropped like a rock to 9.4 percent.

But, the detail:  The reason the unemployment rate dropped is that more people stopped looking for work, and apparently joined the ranks of the long-term unemployed.

Why do I think I'd like to see statistics in the next four months or so to conclude whether the economy is really improving?

But Obama will take the credit for this, no doubt about it.  And his disciples in the media will go hype-crazy.

January 7, 2011