

Hooray: The Second Derivative of the Unemployment Rate Improved - soundsop
http://www.fivethirtyeight.com/2009/05/horray-second-derivative-of.html

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biohacker42
I never thought I would be a fan of writing about statistics. But Nate Silver
has become a must-read.

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joe_the_user
Uh,

Sure, it sounds clever but taking the second derivative of noisy data is poor
statistics as far I'm concerned.

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benmathes
Keep in mind that unemployment figures are not a simple polynomial.
Specifically, an _improvement_ in the second derivative (not even necessarily
positive) doesn't directly imply that we're going to improve. The article
mentions this too:

>\----------------------------------------------------

The $787 billion question, of course, is whether a decrease in the rate of job
losses indeed portends a recovery, or whether such data is subject to false
starts.

>\----------------------------------------------------

I'm all for optimism, but there's enough short-term fluctuation in economic
statistics that this is like getting the faintest whiff of baked goods and
wondering whether we're all getting donuts next week.

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kqr2
You can also quote an article by using asterisks:

From the help <http://news.ycombinator.com/formatdoc> :

 _Text surrounded by asterisks is italicized, if the character after the first
asterisk isn't whitespace._

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patrickg-zill
Contrarian view: <http://www.shadowstats.com/alternate_data>

"actual" unemployment if computed the way it was in 1992: 19% for "shadowstats
version of U6" versus "official U6"

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UncleOxidant
Also note that the "birth-death" model fudge-factor they used for April was
226,000 which was about double what it was for March.

Watch out for revisions as well: "February was revised down from -651k to
-681k (-30,000) and March was revised from -663k to -699k (-36,000). See a
pattern there? That's 66,000 jobs that were reported as existing but revised
out later."

[http://market-ticker.org/archives/1026-Unemployment-Fried-
Da...](http://market-ticker.org/archives/1026-Unemployment-Fried-Day.html)

~~~
gills
Don't forget the phantom ('seasonal') 60,000 jobs created by temporary hiring
for the census...

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mustpax
Using the term second derivative obscures the meaning here somewhat.
'Deceleration' would be a more accessible concept to use to describe what's
happening. It doesn't mean we're going backwards yet (i.e. net employment
gains), but the rate of loss is slowing. At least that's what they told me in
Physics class.

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mattyb
I don't think there's any obscurity; this is high school calculus. If the rate
of change (first derivative, negative in this case) is slowing, that means the
second derivative is positive here. I'm not yet convinced this is a sign of
things to come, however; there are five inflection points in his table where
the rate of loss improves.

~~~
mustpax
I'm not saying the terminology is wrong or anything like that. I'm just saying
'deceleration' is a more concise and comprehensible way of talking about
changes in the second derivative. You might be surprised how little high
school calculus most people have retained.

~~~
joetrumpet
Or how little high school calculus people have taken. At my high school not
even precalculus was a requirement. Of a graduating class of around 300, I'd
say 30-45 students had taken a calculus course.

I agree that acceleration would be a much clearer term.

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ojbyrne
Just a slightly associated random data point. Across the 10 yard border Canada
announced their own surprise - 35k net job increase in April:
<http://www.thestar.com/business/article/631083>

