Ray Dalio, founder of Bridgewater Associates, says there’s a need to rethink how the US government devises economic data.
Over the weekend, President Donald Trump fired Erica Mantelfer, head of the Bureau of Labor Statistics, due to a large downward revision of the number of jobs.
On Friday, BLS revised its employment growth in June from 147,000 to 14,000, down 90%.
The May figures were also revised from 144,000 to 19,000, bringing a total of two months downward revisions to 258,000 jobs.
Some analysts at US banks have begun citing data as evidence that could suggest that the economy is slowing down and potential recession signals are flashing.
Despite the controversy over the layoff of the BLS Commissioner, in a post on social media platform X, Raydario also says she has fired her.
“I probably fired the head of the Bureau of Labor Statistics.
That’s because the process of creating estimates is clearly outdated and error prone, and there’s no good plan for the work to fix it. A massive revision of employment numbers on Friday is a symptom of this, especially as the revisions brought figures to private estimates that were actually much better.
This ensures that I am well aware of the way I use data to follow the economy and bet on where it is heading. ”
Dario says that if Trump actually fires the BLS chief purely for political reasons, it could be a “big problem.”
So investors say, “If President Trump has made his thoughts clear, that’s a good thing.”
“In any case, there needs to be a major renovation in the way the government estimates what is happening in the economy and estimates it is less and more accurate.”
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