tl;dr
Bridgewater Associates founder Ray Dalio commented on the firing of Erika McEntarfer, head of the Bureau of Labor Statistics, after significant downward revisions to job growth figures for May and June. Dalio supported the dismissal, citing outdated and error-prone BLS methodology that led to inaccu...
Bridgewater Associates founder Ray Dalio has weighed in on the recent controversy surrounding the US government's economic data reporting. Over the weekend, President Donald Trump dismissed Erika McEntarfer, the head of the Bureau of Labor Statistics (BLS), after the agency significantly revised job growth figures downward. Specifically, the BLS adjusted June's job growth from 147,000 to just 14,000, a dramatic 90% drop, while May's numbers were revised from 144,000 to 19,000. This downward revision totaled 258,000 jobs across the two months and sparked concerns among analysts about a potential economic slowdown or recession.
Dalio expressed understanding of the firing, stating that he probably would have taken the same action because the BLS’s methodology for estimating employment figures is outdated and prone to error. He pointed out that these large revisions merely aligned official numbers with more accurate private sector estimates. Drawing on his extensive experience using economic data to guide investment decisions, Dalio emphasized the need for a thorough overhaul of how the government collects and reports economic information.
While Dalio acknowledges that if the firing was politically motivated, it could present a serious issue, he urged President Trump to clarify his reasoning. Ultimately, Dalio argues that improving the accuracy of economic data is crucial and should be a priority, encouraging major reforms in the government's estimation processes to provide more reliable economic insights moving forward.