Category Archives: Dubious statistics

A Picture Worth 1000 Words: A Sighting from the McJobs Market

One of the complaints too often taken seriously by the business press is employer claims that they can’t find workers with the right skills for open job slots. We’ve looked at some of these stories in the past, and when employers complained, it pretty much without exception reflected that because the economy is slack,they expect to be able to hire workers cheaply, which often includes not being willing to spend time to train someone. In fact, there has been a perverse trend starting more than a decade ago of employers putting out incredibly narrow job specifications. They were effectively saying they were willing only to hire someone who had been in precisely the same role at a similar company.

But even as McJobs look to be the fastest growing employment sector, just because they want to hire workers for as little as possible does not mean that prospective employees will hit their bid.

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“Private Equity at Work” Rigorously Debunks Industry Mythology

I must confess that I have been extremely tardy in discussing a tremendously important book on the private equity industry, Eileen Appelbaum’s and Rosemary Batt’s Private Equity at Work.

In the meantime, the book is getting the attention it deserve via a glowing review by Bob Kuttner in the New York Review of Books, Why Work Is More and More Debased.

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Media Giving Corporate Executives a Free Pass on Their Value Extraction

Executive rentiers and their media lackeys are invoking the canard that they can’t find decent investment opportunities. The truth is that they’ve exhausted the first and second lines of value extraction, that of labor-squeezing and disinvestment, and aren’t prepared to accept the lower but still attractive returns of taking real economy risks.

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Deconstructing Fed Chair Janet Yellen on Unemployment and the Unemployed

I would have liked to see some table pounding and shouting about pseudo-scientific constructs like the “Natural Rate of Unemployment” — what’s “natural” about it? — or a heartfelt plea for a well-funded study to find out how the permanently disemployed actually eat, and find shelter, and stay alive — System D? — or even a dim recognition that regulating the economy by throwing people out of work is just as barbaric and inhumane as the medieval remedy of bloodletting.

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Bank Settlement Grade Inflation: High Bullshit to Cash Ratio in $17 Billion Bank of America Deal

Over the last year, the Administration has entered into a series of bank settlements over various types of mortgage misconduct. The sudden rush to generate headlines from misdeeds that have been covered in the media in lurid detail during and after the crisis looks an awful lot like an effort to stem continuing criticism over the abject failure to punish banks and more important, their execs for blowing up the global economy for fun and profit, particularly since the Dems are at serious risk of losing control of the Senate in the Congressional midterms.

But as much as the media dutifully amplifies the multibillion headline value of these pacts, we’ve reminded readers again and again that all of these agreements have substantial non-cash portions which are ludicrously treated as if they have the same value as cold, hard cash.

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Guitar Center and Private Equity’s Magical Growth Curve

Yves here. We’ve featured Eric Garland’s past posts on Guitar Center, a case study of how a private equity firms (originally Bain Capital, now Ares Capital as a result of a restructuring when the company was on the verge of failure) run businesses into the ground for fun and profit.  Garland stresses that the assumptions that Guitar Center and its owners are touting for growth, given the state of big box retails, amount to an advanced case of magical thinking. Garland also focuses on the broader impact of the Bain/Ares misrule, namely the damage done to employees and vendors.

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“Land Grabs” – Economists’ Justifications of Agricultural Expropriation

Yves here. Robert Heilbroner described economics as the study of how society resources itself. It’s hard to think of a resourcing issue more basic than food. Not surprisingly, food and the means of producing it were the source of traditional wealth (the so-called landed aristocracy). Similarly, expropriation of rights that yeoman farmers had enjoyed, such as hunting rights and access to common pasture land, were the main devices that early industrialists used to end the farmers’ self-sufficiency and force them to sell their labor as a condition of survival. Even though similar land grabs are justified now under the idea that large-scale farming is more efficient than cultivation by smaller operators, Tim Wise contends that evidence is not conclusive, particularly in emerging economies.

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Wishful Thinking About Natural Gas: Why Fossil Fuels Can’t Solve the Problems Created by Fossil Fuels

Albert Einstein is rumored to have said that one cannot solve a problem with the same thinking that led to it. Yet this is precisely what we are now trying to do with climate change policy.  The Obama administration, the Environmental Protection Agency, many environmental groups, and the oil and gas industry all tell us that the way to solve the problem created by fossil fuels is with more fossils fuels.  We can do this, they claim, by using more natural gas, which is touted as a “clean” fuel — even a “greenfuel.

Like most misleading arguments, this one starts from a kernel of truth.

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CBO – Still Pushing Deficit Scaremongering Propaganda

Yves here. We’ve written from time to time about the shameless partisan role that the Congressional Budget Office plays in stoking misguided and destructive concern about budget deficits. It’s important to recognize the CBO’s openly partisan stance on this issue, because it is supposed to make independent, apolitical budget forecasts and is widely and mistakenly seen as “objective”. In fact, the CBO’s regularly takes stances that put them in the same camp as billionaires like Pete Peterson and Stan Druckenmiller, who want to slash Social Security and other social safety nets.

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Bill Black: Two EU Finance Ministers Throw Their Bosses and Nations Under the Bus

The finance ministers of Italy and Serbia have just publicly thrown their heads of state and their nations under the bus.  In a testament to the crippling effect of the belief that “there is no alternative” (TINA) to austerity, these finance ministers have insisted on bleeding economies that are in desperate need of fiscal stimulus.  Their pursuit of economic malpractice is so determined that they eagerly sought out opportunities to embarrass the democratically elected head of state in Serbia when he dared to support competent economic policies.

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Gaius Publius: IPCC’s “Carbon Budget” Gives One-in-Three Chance of Failure

All of the talk in the lead-up to this year’s meeting in Paris of the United Nations Framework Convention on Climate Change will be about how much “burnable carbon” we can still emit. In other words, what’s our remaining “carbon budget”? Or more to the point, how much more money can Exxon make and still be one of the good guys?

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