Why Yellen Threw Unemployment Under the Bus

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Feb. 12 (Bloomberg) -- On "The Real Deal," Michael McKee examine Fed Chair Janet Yellen's congressional testimony. He speaks on Bloomberg Television's "In The Loop." (Source: Bloomberg)

The jobless rate is.

Janet yellen said we've made a lot of progress in labor market but there is a long way to go which raises the question of how hard you push to get there.

This is her dilemma -- the share of americans who have jobs has barely changed over the last few years coming out of the recession.

The unemployment rate is dropping sharply.

How do you explain what is happening?

What is the participation rate?

It is also falling but it has been falling for more than a kid before the recession.

A lot of it may be baby boomers who are retiring and leaving the workforce and the other part is people who are discouraged workers.

She has to figure out which percentage is which.

If it's mostly discouraged workers, you push hard and try to stimulate the economy and get them back to work.

It's mostly people dropping out, you could have a big out of inflation.

How does she decide?

She broadens the database.

That was the centerpiece of her testimony yesterday.

She is looking at the layoffs rate.

It has come way down, below where it was before the recession started.

While that's going confidence, not enough, because the quit rate, the people who feel they can get another job is moving up and near where it was before the recession.

There is still a lot to do it appears.

There are other indicators -- the participation rate does not give us a clear answer but the unemployment -- the u-6 unemployment rate and others -- are people finding jobs more easily?

They even look at the jobs hard to get question.

Do people feel better about their chances of getting a job?

Even if these indicators change, janet yellen did not seem to budge on the tapering program.

They seem to believe that is not providing the kind of bang for the buck they want in the labor market.

They say tapered is still on track but they don't see it as useful anymore.

It would take what she called a notable change in the outlook to get them to reverse tapering or even slow it down.

Unemployment would have to be rising, inflation still falling, and they would have to see signs that spending would be slowing as well as gdp and the economy had changed direction.

Thank you so much.

We watched janet yellen plus first testimony carefully but also don't miss the exclusive

This text has been automatically generated. It may not be 100% accurate.

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