How messed up is this?
Well, this is rich. From today's Wall Street Journal:
Federal Reserve Chairman Ben Bernanke suggested the Fed won't be convinced that the risk of higher inflation has subsided until the unemployment rate rises and businesses are operating farther from full capacity.
"A couple of good numbers does not, by itself, mean that the problem is solved and gone away," Mr. Bernanke yesterday told the Senate Banking Committee in the second of two days of congressional testimony. "Part of it is just simply seeing more data and getting a greater sense of assurance that the trend is really in the direction we'd like to see it."
If we take Bernanke at his word (which of course we should not), the Fed might never again lower interest rates… because of the way the unemployment numbers are kept artifically low through the "birth-death model" and other statistical legerdemain.
It's come to this: We have one agency setting monetary policy based in part on bogus numbers from another agency.