A Graphic Exposition on Seasonality in Key Macro Indicators

Reader Bruce Hall argues that “With the exception of travel related and luxury related items, the monthly adjustments[to the CPI] tend to be relatively minor…”. I beg to differ.

Here is the CPI seasonal component:

Figure 1: Log ratio nsa CPI all urban to sa CPI (blue). NBER defined peak-to-trough recession dates shaded gray. nsa CPI is FRED series CPIAUCNS, sa CPI is FRED series CPIAUCSL. Source: BLS via FRED, NBER and author’s calculations.

In July 2022, the unadjusted CPI looks one-third of a percentage point higher than the adjusted. Is that “minor”? I don’t think so.

Does converting to growth rates fix things? Only if one does a 12 month difference (note: that won’t work for Chinese data, where the lunar new — tomorrow for 2023 — moves from January to February and back). Below is the seasonal component in the month-on-month annualized CPI all urban inflation.

Figure 2: First difference of log ratio nsa CPI all urban to sa CPI (blue). NBER defined peak-to-trough recession dates shaded gray. nsa CPI is FRED series CPIAUCNS, sa CPI is FRED series CPIAUCSL. Source: BLS via FRED, NBER and author’s calculations.

In April 2022, annualized month-on-month inflation looks like 2.7 percentage points higher using unadjusted data than what it looks like using adjusted data. Is that “minor”? I don’t think so.

How about Core CPI?

Figure 3: Log ratio nsa core CPI all urban to sa core CPI (blue). NBER defined peak-to-trough recession dates shaded gray. nsa CPI is FRED series CPILFENS, sa CPI is FRED series CPILFESL. Source: BLS via FRED, NBER and author’s calculations.

Up until the Great Recession, seasonals were about a third of a percentage point. Now they’re around a sixth.

And about nonfarm payroll employment.

Figure 4: Log ratio nsa nonfarm payroll employment to sa employment (blue). NBER defined peak-to-trough recession dates shaded gray. nsa nonfarm payroll is FRED series PAYNSA, sa is FRED series PAYEMS. Source: BLS via FRED, NBER and author’s calculations.

Unadjusted nonfarm payroll is nearly a percentage point higher than adjusted. I think we all agree that is not “minor”.

35 thoughts on “A Graphic Exposition on Seasonality in Key Macro Indicators

  1. Macroduck

    One wonders what old Aristotle would think of some commenters’ behavior here. Aristotle argued that virtue requires practice. Taking virtuous action makes future virtuous action more likely, easier. Being virtuous is a habit.

    Aristotle also argues that humans are meant to behave according to reason, that one can reason well or badly, and that virtue is served by reasoning well.

    Reasoning well leads to virtuous behavior. Repeated virtuous behavior leads to virtuous character. Rub those two ideas together and you get that repeatedly reasoning well is likely to encourage virtuous character.

    Conversely, repeatedly reasoning badly is the path to a lack of virtue. Anyone who engages in debating tricks, who gathers evidence and builds arguments only to support preconceived ideas, who rolls in the muck of dogma, will lack virtue.

    This “virtue” Aristotle write of is not merely “be nice” or “don’t spit indoors” or “wear clean socks”. Aristotle’s virtue is akin to wisdom and to excellence in practical living.

    Repeatedly engaging in disingenuous argument, misconstruing facts and falling back on rhetorical trickery weakens one’s capacity to make valid, evidence-based arguments, in Aristotle’s view of things.

    A final point about Aristotle’s thinking about learning to lead a virtuous life – moral exemplars help. Given the choice between hanging out with, reading, quoting, linking to and mimicking some guy who supports one’s preconceived notions, or hanging out with someone who is led by reason, do the hard work of hanging out with the guy who is led by reason.

    It’s all in here:


    1. pgl

      Aristotle never worked for Kelly Anne Conway. Of course it is amusing how Brucie and JohnH keep digging deeper when they are in a deep hole. Then again their hero is Donald Trump who lies 24/7 and is in a habit of doubling down even after the lies have been exposed. MAGA!

  2. pgl

    Brucie is following the lead of JohnH – making declarative statements on topics they have no clue about. Followed of course by attempting to smear people who point out the errors they make.

  3. pgl

    “I’m not sure why the fixation on NSA data. I did use that once, many, many comments ago, but quickly changed to SA data.”

    Quickly? It took a couple of weeks for Brucie to finally admit the error he made. No – this troll had suggested I had abused a series that omitted the price of cannabis. I guess he is high on this stuff when he writes his trash.

    Come on Brucie – just be honest for once in your silly little life. It is my fault that you routinely write dumb things.

  4. pgl

    Of all the bogus claims Brucie originally made and all these attempts at reformulating what he originally said – the most comical original claim was the premise that people’s real income fell by the rise in CPI over this 1.5 year period. Which of course was all Joe Biden’s fault. I tried to tell this Know Nothing that he was assuming nominal income had not changed and challenged him to justify that bogus assumption. Over two months later – Brucie has yet to respond with a shred of data.

    Let me note a simple illustration involving two people – Betty and Bob. Let both have seen a 12.5% increase in the prices of things they buy.
    If Bob’s nominal income had increased by 10% he would be 2.5% worse off not 12.5% worse off. Now Betty’s nominal income rose by 15% so she is 2.5% better off not 12.5% worse off. Everyone that passed freshman economics knows this but not Bruce Hall.

    I suggested to Brucie to look at GDI since this was heavily noted a few months ago:


    2020Q4 $22163.2 billion
    2022Q2 $25517.8 billion

    An increase over 15%. So the typical person is like Betty. Now one might ask – why did Brucie never address this part of his original BS. Because Kelly Anne Conway would fire him if he did.

    1. pgl

      You are still chirping after all the embarrassing moments you have caused for your poor family? The scale was clear to the grownups and if you think being off by 1.5% is something to laugh at – no wonder you wrote that worthless blog 15 years ago. Yea I took a quick look at one of your posts. Dumber than a rock then – dumber than a rock now.

      Now go apologize to your mother for making a mockery of her family.

      1. Bruce Hall

        Still having trouble seeing the bigger picture, eh? No, I wasn’t arguing that there was no seasonality. My point that it was relatively minor except for a couple of sectors and that it didn’t make any difference in the proposition that inflation was the issue between 1/21 and 6/22, but that from 6/22 to 12/22 it has be quite tame.

        Now you can look at the CPI between 1/21 to 6/22 and compare that to average hourly real income during that period and declare that they changed in complete synchronicity, but no one else in the world will. In fact, much was made of the problem in the media. So… just go back to making up stuff.

        As to the depiction of seasonality above, the vertical scale certainly emphasizes that phenomenon… and obfuscates its unimportance with visual trickery. That was the point of my early comment to this post. Yes, unimportant in the context of the proposition stated above. But thanks for providing yet another laugh.

        Oh, just curious… have you gotten the exact count of how many angels can dance on the head of a pin?

        1. pgl

          “Still having trouble seeing the bigger picture, eh?”

          I have no trouble at all seeing the bigger picture. You are a partisan hack who has embarrassed himself over and over on this issue as you do on all issues. And once you are called out – you LIE about what you originally said. Give it up Brucie – there is NO ONE that trusts a word you say including this babble:

          Now you can look at the CPI between 1/21 to 6/22 and compare that to average hourly real income during that period and declare that they changed in complete synchronicity

          synchronicity it is now. Try mismeasurement troll. You mispresented your own cherry picked period change in CPI by 0.7%. Now comparing this to real wage changes is a total dodge. Of course you first told us real incomes in the aggregate fell by 13.3% when in reality real GDI rose by 2.5%.

          So take your ever changing weasel words and learn to first grade arithmetic.

        2. 2slugbaits

          Bruce Hall I wouldn’t call the seasonality effect “relatively minor.” If you think a 2.7 percentage point difference is relatively minor, then presumably you wouldn’t object to a 2.7 percentage point increase in your tax liability. As to the number of angels dancing on the head of a pin, the exact number is zero. And since you’re so concerned about increasing deficits, perhaps you would like to explain your support for Donald Trump. Trump increased the deficit as a percent of GDP each of his four disastrous years. Biden has reduced the deficit as a percent of GDP.

          1. Bruce Hall

            2slug, I presume you are referring to the variation from lowest month factor to highest month factor and not the difference between starting and ending values of NSA and SA during the 1/21 through 6/22 period. But as pgl himself calculated, it is far less than 2.7pp. So, yes, seasonality is a minor consideration in the context of my proposition that inflation raced during that period and flattened after that. pgl is still hung up on that nit.

            As to national debt during Trump’s administration, your statement is patently incorrect.
            The ratio was almost identical to Obama’s last quarter of 2016 (105.3) through the 3rd quarter of 2019 (105.5) despite Trump’s tax cuts and only got out of kilter when the economy was shut down by states following CDC guidelines in 2020 and the Democrats in Congress pressured Trump to accept the massive spending to bail out companies and individuals as a result of those shutdowns. Two bad panicky decisions compounded the problem. You have a short memory. You might note that from Q3 2021 through Q3 2022 that ratio was not brought down as Congress and the POTUS scrambled to spend as much money as they could… even though the shutdown was 2 years past.

            Incidentally, national debt to GDP went from 77.1 to 105.6 under Obama without a forced shutdown. Yes, it started with a recession, but Obama had 7 more years to get the spending under control and had no intention of doing that.

          2. pgl

            You have to forgive Bruce Hall for confusing deficits (which you mentioned) and debt. This troll had trouble distinguishing price levels (CPI) and rates of change of the price level (inflation). His preK teacher has literally given up on him.

          3. 2slugbaits

            Bruce Hall As Menzie noted, economists usually look at debt held by the public, which is not the same as public debt. Public debt includes intra-governmental debt, which includes national savings from FICA taxes. It’s a bit counterintuitive, but it’s entirely possible for the public debt to increase while deficits and debt held by the public decrease. In fact, we see this often enough under Democratic presidents. You need to take a course in national income accounting.

          4. pgl

            I thought I would add this since our host raised an important point that most people get but not Brucie:


            ‘Bruce Hall: Usually, one uses debt held by public which nets out inter-governmental debt’

            Thanks Dr. Chinn but come on – Brucie does not know what intergovermental debt is. This calls it Trust Funds as in the Social Security Brucie depends on for his food and rent as well as the retirement benefits for our veterans and former civil servants.

            Now Brucie’s MAGA hat friends in Congress have only one way that they might reduce the deficit – which is either to rip Brucie off or rip off our veterans if not both.

            So Brucie – who should be ripped off re their retirement benefits? Come on big boy – take a stand.

          5. pgl

            “So, yes, seasonality is a minor consideration in the context of my proposition that inflation raced during that period and flattened after that. pgl is still hung up on that nit. As to national debt during Trump’s administration, your statement is patently incorrect.”

            Bruce Hall is still trying to blame me for his confusion over NSA v. SA? Yea – I was the first to point out his error which it seems is not a nit but I am not hung up on it at all. But let’s get back to Dr. Chinn’s note on debt held by the public v. total debt. Yes total debt grew by 16.25% over Bruce’s period while nominal GDP grew by 13.5% – half of which was inflation.

            But as Dr. Chinn suggested the debt held by the public grew by almost 20% over the same period.

            If Brucie had properly pulled out the funds in those Trust Funds, he might have noticed that they were increased by an amount barely covering inflation.

            So what has Bruce really noted – Trump’s era did nothing to shore up the real value of the Trust Funds for Social Security and the retirement funds for our veterans etc.

            So way to go Brucie – your boy screwed veterans and old people.

    2. pgl

      Bruce’s old worthless blog had this persistent tag:

      ‘Stupidity Has Its Own Rewards’

      Brucie rewarded those foolish enough to read that blog with incessant stupidity indeed!

    3. pgl

      This is how Bruce Hall dismissed global warming?

      ‘Here’s a frame of reference for you. Orlando, Florida has an average annual temperature of 72.4 degrees F (22.4 degrees C) and Detroit, Michigan has an average annual temperature of 48.6 degrees F (9.2 degrees C). If Detroit’s annual average temperature increased by 1 degree C, it would still be 12.2 degrees C colder than Orlando.’

      Comparing temperatures in Michigan to those in Florida? DAMN – and we thought CoRev was the dumbest troll ever. No, Brucie wins this prize hands down!

      1. Bruce Hall

        Bigger picture, pgl… bigger picture. Yeah, put the nits into context. One or two degrees less than the intra-morning variation between 8am and 10am. Humans live from the Arctic Circle to the Antarctic Circle. So, yeah quit being afraid of the bogeyman. After all, we all came out of Africa, right? And somehow survived the Ice Age. But don’t worry, if warming a few degrees is too much for you in New York City, you can emigrate to Nova Scotia and enjoy the comfort of that climate.

        I know you’re still pining for the Little Ice Age when those glaciers you are so fond of were growing again. Too bad that ended around 1850, the point to which we are now comparing current temperatures.
        It was such a good time then, ja sure. Of course, before that there was that nasty warm period when the Vikings were settling Greenland. Good thing Greenland froze over or you might be speaking Norwegian.

        1. pgl

          Your incoherent babbling is worse than CoRev’s barking. The only thing you suck at more than economics is climate change. BTW – how many morons read your worthless blog. Two, three?

          1. Bruce Hall

            Your snarky comments contain no actual rebuttals… just that you don’t like them. You should finish that bottle of wine.

        2. pgl

          ‘Starting in the fourteenth century, cooling temperatures disrupted our economic and social structures—and may have given rise to the modern world.’

          This is Bruce’s excuse for allowing global warming to disrupt modern economies. People centuries ago were too cold? I’m sorry but why hasn’t someone locked Brucie up before he hurts himself?

          1. Bruce Hall

            “… excuse for allowing global warming to disrupt modern economies.”

            Show me the money! The only “disruption” is the really terrible energy policies that have driven us toward more expensive and less reliable energy while wasting taxpayers’ money on subsidizing various Solyndra schemes and making Al Gore wealthy with his “sky is falling” schtick.

            Oh, I know, NYC is now under water as was predicted by many climate “experts”. Wait, that can’t be right. You’re still living there. Well, the polar ice all disappeared. No, that isn’t correct either. More hurricanes hitting the US? No, that didn’t work out. Aw, gee, those were gonna be such great disruptions. Well, some people are so easily manipulated.

            Well, then we just have to attribute every severe weather event to climate change as if they never happened before. Oh, for the days of the Little Ice Age.

          2. pgl

            “The only “disruption” is the really terrible energy policies that have driven us toward more expensive and less reliable energy while wasting taxpayers’ money on subsidizing various Solyndra schemes and making Al Gore wealthy with his “sky is falling” schtick.”

            Bruce Hall’s playing Steno Sue for Kelly Anne Conway. Notice Brucie boy cannot be bothered to tell us what policies he is talking about except “blame Biden” or serious discussion of the loan guarantee program (one default in a large program Brucie?) passed under Bush43. Nothing more than his usual MAGA distortions. That’s Bruce’s idea of a serious policy discussion? Yea – he is one dumb troll.

        3. pgl

          Oh wait – this is Bruce Hall’s defense of global warming:

          Vikings had a settlement in North America exactly one thousand years ago, centuries before Christopher Columbus arrived in the Americas, a study says. Scientists say a new dating technique analysing tree rings has provided evidence that Vikings occupied a site in Newfoundland, Canada, in 1021AD. It has long been known that Europeans reached the Americas before Columbus’s arrival in the New World in 1492. But this is the first time researchers have suggested an exact date.

          OK Brucie lives in Michigan so maybe he is upset that the Vikings went to the playoffs and not his Lions. But WTF does this have to do with climate change? Brucie has no clue as he does not even know WTF his own links say.

        4. 2slugbaits

          Bruce Hall Your comparison of slightly warmer temps in Orlando and Detroit as the good news story concerning global warming just shows your ignorance. Here’s the right way to look at global warming. During the last ice age the mean global temperature was 46 degrees Fahrenheit. Currently the mean global temperature is 57 degrees. The pre-industrial global temperature was a tick over 55 degrees. In other words, only 11 degrees separates us from the ice age and miles of ice over Europe and North America. Let that sink in for a moment. A mere 11 degrees difference in the global temperature is the difference between your golf game and living under a glacier. Now let’s reverse that an imagine what kind of planet we’d have if temperatures climb to 65 degrees, or 10 degrees warmer than the pre-industrial average. Now in you uninformed mind you might think a global temperature of 65 degrees sounds downright pleasant…just a light windbreaker would be great. But think again. The earth would be hotter in the future relative to today than today’s temperatures are warmer relative to the ice age. Your descendants won’t be playing golf. Think a 10 degree warm-up isn’t possible? Then read this:
          According to the 2017 U.S. Climate Science Special Report, if yearly emissions continue to increase rapidly, as they have since 2000, models project that by the end of this century, global temperature will be at least 5 degrees Fahrenheit warmer than the 1901-1960 average, and possibly as much as 10.2 degrees warmer. If annual emissions increase more slowly and begin to decline significantly by 2050, models project temperatures would still be at least 2.4 degrees warmer than the first half of the 20th century, and possibly up to 5.9 degrees warmer.

    4. pgl

      Someone has to do it so I read Brucie’s last blog post concerning economics, which I think was written in early 2013:

      ‘Economists tell us that in order to correct the federal government revenue/spending imbalance, we will either have to raise taxes or have no-growth or a declining economy… which is then used to justify spending even more. Debt is a problem for the next generation. We need to keep up appearances of prosperity. A small taste of the impact of reduced spending appeared in the 4th quarter of 2012 as defense spending and corporate inventories shrank [companies produced from their inventories without adequate replacement] resulting in a Gross Domestic Product decrease of 0.1% from the previous quarter. That’s hardly reason for panic, but it does tell us that without excessive borrowing, economic measures will look anemic.’

      Yea – Bruce had a blog even dumber than the trash ala Princeton Steve.

      1. Bruce Hall

        So, you think that consistently running increasing deficits is good policy and that at no point will debt servicing be a problem. I guess as long as the government can borrow at 1% or so, it’s manageable, but when the cost goes up because free money is no longer available?

        Can I use your credit card?

        1. pgl

          Obama ended the ever rising debt/GDP ratio Bush handed him. Trump gave us another rising debt/GDP ratio which Biden is lowering. Gee Brucie – you might want to tell Kelly Anne to stop lying to you.

          BTW – your comment shows you never read Barro Friedman Sargent & Wallace on the burden of the debt issue. Then again economics and basic finance is something over your pee brain.

        2. pgl

          ‘Can I use your credit card?’

          Brucie maxed out his credit card and his mommy cut him off. No Brucie – I support you way too much as you live off the government dole already.

        3. baffling

          “Can I use your credit card?”
          see, this is simply dishonest. you are conflating paying your bills with using the credit card. it is fine to throw away the credit card, because you don’t want to run up more bills. but that does not absolve you of your responsibility to pay the bills you have already incurred. bruce, what you are advocating for is a declaration of bankruptcy. sure, it is a path that can be followed. but be man enough to admit that is what you are calling for. overspend and then declare bankruptcy. republican version of fiscal responsibility, i guess. most folks consider it dishonest.

        4. Noneconomist

          Increasing deficits, Bruce?
          Final Obama budget, 2016-2017: deficit $665 billion
          First Trump budget, 2017-2018: : deficit $779 Billion +17.1%
          Second Trump budget, 2018-2019: deficit $984 Billion + 26.3%
          That’s prepandemic. Final Trump budgets? Well, we know it doesn’t get any better.
          % deficit increase from final Obama budget to second Trump budget + 47.9%
          You were saying?

  5. Baffling

    The republican party, at least in texas, is willing to take away a legal voters right to the ballot box i order to defend against an illegal voter casting a ballot. This is voter suppression, and is occurring because the supreme court eliminated voter protection rights brought about decades ago because of voter discrimination acts in the south.
    Now enter george santos. Not even sure if this is his actual name. May not even be eligible to be a citizen or vote. And the republican party has no problem assigning him to a committee in congress! Seriously, you cant make this stuff up!

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