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New Jobless Claims: Thunderdome Edition
Townhall.com ^ | May 4, 2012 | Political Calculations

Posted on 05/04/2012 5:35:50 AM PDT by Kaslin

Previously, we advanced two possible hypotheses that might explain what is currently happening with the number of seasonally-adjusted initial unemployment insurance claim applications being filed in the U.S. each week:

  1. The number of new jobless claims filed each week is in the process of leveling out somewhere between 370,000 and 380,000, which is about 60,000-70,000 higher than the typical levels that were recorded before the December 2007 recession began.
  2. Rising oil and gasoline prices in the U.S. have derailed the most recent falling trend in new jobless claims, and a new, negative trend has begun where the number of claims filed each week is rising.

In that post, we indicated that we might not know which hypothesis was correct until sometime this summer. But that was before the U.S. Bureau of Labor Statistics released its initial estimate of the number of new jobless benefit claim filings on Thursday, 26 April 2012. Now, it is very possible we might know the answer as early as this upcoming Thursday, 3 May 2012.

We've updated both charts showing our two hypotheses to incorporate the data as it stands as of the BLS' 26 April 2012 report. The first chart illustrates our first hypothesis:

Residual Distribution for Seasonally-Adjusted Initial Unemployment Insurance Claims, 26 March 2011 - 21 April 2012

In this chart, we would seem to be realizing our first hypothesis, in that the indicated trend, which we've identified as Trend I, is in the process of flatlining.

Western Electric Rules for Detecting Breaks in Established Trends Using Statistical Control Charts Now take a closer look. Focusing in on the data from 4 February 2012 through 31 March 2012, we see that the mean trend line for all data reported since 3 December 2011 has shifted in the past week so that all but one of these data points are below the line.

Following the well-established rules developed by Western Electric over half a century ago to determine whether or not an existing trend has broken down after having been in statistical equilibrium, which are visually depicted in the bell-curve image (it's not there for decoration!), we find that all it would take for us to declare this hypothesis to be false is for the most recent data, for the week ending 21 April 2012, to be revised upward by more that 2,000 claims, as the resulting change in the mean trend line will place the data for these nine consecutive weeks below it.

If the BLS keeps to its recent track record, it will definitely be revising the number of new jobless claims recorded for the week ending 21 April 2012 upward when it revises its data for that week this Thursday, 3 May 2012 - the only question is by how much.

Our second chart shows what the new trend would look like at this point in time:

Residual Distribution for Seasonally-Adjusted Initial Unemployment Insurance Claims, 26 March 2011 - 21 April 2012, Trend J begins?

This Thursday, our two hypotheses regarding the current trend in new jobless benefit claim filings will enter the theoretical Thunderdome, and very possibly, only one will leave. Stay tuned!


TOPICS: Business/Economy; Culture/Society; Editorial
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Steve Doocy just announced on Fox and Friends that the unemployment rate fell to 8.1%

Sure looks like a lot of number fixing going on. There is no way it should have gone down

1 posted on 05/04/2012 5:35:54 AM PDT by Kaslin
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To: Kaslin

It’s going down because so many people have stopped looking for a jobs.

If everyone stops looking the unemployment rate will be 0 by election day.


2 posted on 05/04/2012 5:43:51 AM PDT by CaptainK (...please make it stop. Shake a can of pennies at it.)
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To: Kaslin
Sure looks like a lot of number fixing going on.

Between now and the election there is absolutely no way you can trust any employment or economic numbers being "reported" by the administration and/or the MSM. No way.

They will report signs of recovery in multiple sectors of the economy. They'll report job growth, housing starts, fewer businesses failing, etc. All rosy indicators. All made up.

Ok, there may be a few niches with some real recovery. But nothing like the storm of lies that is coming. Don't trust anything you get from the MSM - not that I do anyway. But now, look for them to be completely in the tank for their fellow socialists/fascists.

3 posted on 05/04/2012 5:50:32 AM PDT by ThunderSleeps (Stop obama now! Stop the hussein - insane agenda!)
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To: CaptainK

That is correct and the bad news for Obie is that the reason for the drop is being included in the media’s breathless reporting. It stinks and they can’t hide the smell any longer.


4 posted on 05/04/2012 5:52:51 AM PDT by JPG (Please pass the pooch.)
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To: CaptainK
Start with 52 weeks of benefits. Add 99 weeks of benefit extensions. Get laid off in the first year of the Obamites' run, and you are falling off the unemployment rolls about...now.

Now, because you no longer qualify for Federal unemployment benefits, if you don't have a job, you don't count. You are a 'discouraged worker' or some such and no longer in the labor force.

Fewer people in the labor force, divided into (the number who are officially out of work (declining also), means the fraction of officially unemployed people will get smaller as the (former) workers are no longer officially part of the labor force.

The timing is such that the numbers should just get better running up to the election as more out of work workers who are no longer officially unemployed are discarded from the labor rolls.

Probably no coincidence, either.

5 posted on 05/04/2012 6:03:23 AM PDT by Smokin' Joe (How often God must weep at humans' folly. Stand fast. God knows what He is doing)
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To: ThunderSleeps

“Ok, there may be a few niches with some real recovery”

You know one segment of the job market where there is no recovery? Government jobs, over half a million lost under Obama.


6 posted on 05/04/2012 6:09:59 AM PDT by Skylab
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To: JPG
All the unemployed will know they are unemployed when they enter the voting booth in November.

No amount of number spinning will make them believe they have a job.

7 posted on 05/04/2012 6:21:16 AM PDT by CaptainK (...please make it stop. Shake a can of pennies at it.)
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To: Smokin' Joe

Dang. I could get laid off today and unemployment could tide me over until I’m eligible for SS. HAHAHAHA!


8 posted on 05/04/2012 6:30:34 AM PDT by cuban leaf (Were doomed! Details at eleven.)
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To: CaptainK
Correction follows:

It’s going down because so many people have stopped being counted as looking for a jobs.

9 posted on 05/04/2012 6:37:32 AM PDT by NonValueAdded (Chen Guangcheng: Gutsy call, Obama /UltraMegaDrippingSarc)
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To: Kaslin


People Not In Labor Force Soar By 522,000, Labor Force Participation Rate Lowest Since 1981


10 posted on 05/04/2012 6:39:04 AM PDT by khelus
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To: Smokin' Joe
Now, because you no longer qualify for Federal unemployment benefits, if you don't have a job, you don't count.

False. Unemployment compensation has nothing to do with how the unemployment rate is calculated.

11 posted on 05/04/2012 7:02:10 AM PDT by 1rudeboy
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To: 1rudeboy
Well, maybe I am wrong, but I had been brought to believe that if you no longer qualified for benefits, you were removed from the officially unemployed. Note that the statistic used is one of initial jobless claims (unemployment), not who lost a job. If you can't claim, you aren't counted.

Now, if I'm wrong, kindly show me how and provide some links so I can be better educated on the subject. Thanks.

12 posted on 05/04/2012 7:07:29 AM PDT by Smokin' Joe (How often God must weep at humans' folly. Stand fast. God knows what He is doing)
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To: Smokin' Joe
My pleasure. The following provides a number of reasons why making unemployment compensation a factor in calculating the unemployment rate is unsound (statistically).

What do the unemployment insurance (UI) figures measure?

The UI figures are not produced by the Bureau of Labor Statistics. Statistics on insured unemployment in the United States are collected as a by-product of UI programs. Workers who lose their jobs and are covered by these programs typically file claims ("initial claims") that serve as notice that they are beginning a period of unemployment. Claimants who qualify for benefits are counted in the insured unemployment figures (as "continued claims"). Data on UI claims are maintained by the Employment and Training Administration, an agency of the U.S. Department of Labor, and are available on the Internet at: http://workforcesecurity.doleta.gov/unemploy/claims.asp.

These data are not used to measure total unemployment because they exclude several important groups. To begin with, not all workers are covered by UI programs. For example, self-employed workers, unpaid family workers, workers in certain not-for-profit organizations, and several other small (primarily seasonal) worker categories are not covered. In addition, the insured unemployed exclude the following:

Current Population Survey FAQ's, Bureau of Labor Statistics.

To summarize: the government keeps track of the number of folks receiving UI. It results in the numbers reported as "initial claims" and "continuing claims." Those two numbers stand alone from the "unemployment rate" (U-3 or otherwise). The "labor force participation rate" (which is the primary method to massage the U-3 number) also has nothing to do with the number of folks receiving or not receiving UI.
13 posted on 05/04/2012 7:23:10 AM PDT by 1rudeboy
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To: 1rudeboy
False. Unemployment compensation has nothing to do with how the unemployment rate is calculated.

Nice change of subject, rude. But you already knew that...

Smokin' Joe: Now, because you no longer qualify for Federal unemployment benefits, if you don't have a job, you don't count. You are a 'discouraged worker' or some such and no longer in the labor force.

True.

14 posted on 05/04/2012 8:16:45 AM PDT by kiryandil (turning Americans into felons, one obnoxious drunk at a time (Zero Tolerance!!!))
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To: Smokin' Joe

See my post #14. I meant to ping you to it, but got my foot stuck in the BS.


15 posted on 05/04/2012 8:18:49 AM PDT by kiryandil (turning Americans into felons, one obnoxious drunk at a time (Zero Tolerance!!!))
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To: kiryandil

Read my #13 and weep that you didn’t.


16 posted on 05/04/2012 8:19:00 AM PDT by 1rudeboy
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To: 1rudeboy

Your crap’s not worth reading.


17 posted on 05/04/2012 8:26:37 AM PDT by kiryandil (turning Americans into felons, one obnoxious drunk at a time (Zero Tolerance!!!))
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To: Smokin' Joe
rude is just blowing smoke. The unemployment rate depends heavily on the labor participation rate.

Here is an actual Fed economist on the subject (not some anonymous Interwebs sniper with an unknown agenda):

"Interpreting the Recent Decline in Labor Force Participation" - Willem Van Zandweghe (in the Economic Review of the Federal Reserve Bank of Kansas City. )
http://www.kc.frb.org/Publicat/EconRev/PDF/12q1VanZandweghe.pdf

Published 1st quarter, 2012.

18 posted on 05/04/2012 8:44:12 AM PDT by kiryandil (turning Americans into felons, one obnoxious drunk at a time (Zero Tolerance!!!))
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To: kiryandil
I'm just doing my part to challenge probably the single most persistent economic myth on FR. You are trying to perpetuate it. I will tell you this: you shouldn't use technical economic terms if you do not understand what they mean.

And it's bad form to parachute onto a thread accusing anyone of BS when they've cited to authority. The "hidden agenda" stuff I can leave behind. Jonah Goldberg illustrated how the allegation is a symptom of a weak mind.

So, if I am engaged in BS (with an alleged hidden agenda), you should have no trouble demonstrating it. Otherwise, you are just talking out of your behind.

19 posted on 05/04/2012 8:50:22 AM PDT by 1rudeboy
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To: kiryandil
One more thing--your comment that,

the "unemployment rate depends heavily on the labor participation rate," and my comment that,

the "'labor force participation rate' (which is the primary method to massage the U-3 number) also has nothing to do with the number of folks receiving or not receiving UI" does not contradict mine.

They simply do not contradict each other. You just might be too dense to see it. Looks like my crap is worth reading, after all.
20 posted on 05/04/2012 9:06:11 AM PDT by 1rudeboy
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To: 1rudeboy
I will tell you this: you shouldn't use technical economic terms if you do not understand what they mean.

I don't hang out here much. I hang out on economic forums. Whoopsie! Your bad.

I've seen your agenda here on FR. FR is not really a good place for economic stuff, and we both know it. I was just firing a warning shot across the bow of your strawman.

Jonah Goldberg is a tool. He dropped the ball on Derbyshire - a major sign of a weak mind, too influenced by the Beltway twaddle.

So, if I am engaged in BS (with an alleged hidden agenda), you should have no trouble demonstrating it. Otherwise, you are just talking out of your behind.

http://www.freerepublic.com/tag/by:1rudeboy/index?tab=comments;brevity=full;options=no-change

21 posted on 05/04/2012 9:32:47 AM PDT by kiryandil (turning Americans into felons, one obnoxious drunk at a time (Zero Tolerance!!!))
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To: 1rudeboy

It’s amazing. You print the actual facts from the actual source and certain morons still deny reality.


22 posted on 05/04/2012 12:59:52 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Toddsterpatriot

I never called you a moron, Toddster, but have it your way...

rude & Toddy, the economic blowhard twins. :-)


23 posted on 05/04/2012 2:21:26 PM PDT by kiryandil (turning Americans into felons, one obnoxious drunk at a time (Zero Tolerance!!!))
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To: Smokin' Joe

Joe,

You are at least partially right.

To be counted as “unemployed,” a person must be actively searching for work.

By definition, people drawing Unemployment Benefits must look for work, and, by definition, are unemployed.

Once their UI Benefits are exhausted, however, some people - but not all people - end their job search and drop out of the workforce.

Those people are NOT counted as unemployed.


24 posted on 05/04/2012 2:43:25 PM PDT by zeestephen
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To: kiryandil

You’re batting 0 for 2.
Watch out for those facts, you might be allergic.


25 posted on 05/04/2012 4:35:29 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: zeestephen

As a practical question, how does the government count the people who are not receiving unemployment benefits? There are no people getting a check, so how do they keep track of people no longer in the system?


26 posted on 05/04/2012 6:09:23 PM PDT by Smokin' Joe (How often God must weep at humans' folly. Stand fast. God knows what He is doing)
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To: Toddsterpatriot
You’re batting 0 for 2.

**snicker**

Still the same smarmy dweeb you always were, eh, Toddy?

Bucking for another 4 month layoff? You just can't keep yourself from trolling, can you?

http://www.freerepublic.com/focus/news/2705227/posts

27 posted on 05/04/2012 6:16:29 PM PDT by kiryandil (turning Americans into felons, one obnoxious drunk at a time (Zero Tolerance!!!))
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To: Smokin' Joe
The Bureau of Labor Statistics measures employment in two ways. The Establishment Survey gathers data directly from 400,000 companies and then estimates how many Americans have payroll jobs. The Household Survey, based on surveys of 60,000 households, determines how many people are working and produces the unemployment rate.

Don't worry, Toddy & rude will show up in a while to tell me I'm stupid...

28 posted on 05/04/2012 6:20:01 PM PDT by kiryandil (turning Americans into felons, one obnoxious drunk at a time (Zero Tolerance!!!))
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To: Smokin' Joe
There are no people getting a check, so how do they keep track of people no longer in the system?

The same way they track people every month to calculate the unemployment rate. Pretty sure there's link upthread.

29 posted on 05/04/2012 6:25:50 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: kiryandil
Pointing out your ignorance, and John Williams’, is bucking for a layoff?
If you say so.
Do you want to defend the phony Shadowstats numbers?
30 posted on 05/04/2012 6:32:35 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: kiryandil

Hey, you got one right.
Did someone hack your account?


31 posted on 05/04/2012 6:34:44 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Kaslin

8.1% of what?


32 posted on 05/04/2012 6:38:38 PM PDT by Lurker (The avalanche has begun. The pebbles no longer have a vote.)
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To: Toddsterpatriot
The Bureau of Labor Statistics measures employment in two ways. The Establishment Survey gathers data directly from 400,000 companies and then estimates how many Americans have payroll jobs. The Household Survey, based on surveys of 60,000 households, determines how many people are working and produces the unemployment rate.

So they 'estimate' by talking to 60,000 out of 200,000,000 or so. Yea, that's scientific. In other words it's a f****** guess at best at complete bull**** at worst. Toss the fact that this administration lies as easily as I breathe and I'm taking the latter.

33 posted on 05/04/2012 6:46:10 PM PDT by Lurker (The avalanche has begun. The pebbles no longer have a vote.)
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To: Kaslin
Rising oil and gasoline prices in the U.S. have derailed the most recent falling trend in new jobless claims

President Obama, Democrats and Unions would be able to take so much more if they could convince the environmentalists gas under $3.00 would help them all.

34 posted on 05/04/2012 7:04:38 PM PDT by alrea
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To: Toddsterpatriot
Toddy, you're the idiot who got banned for mouthing off to the moderators. Not me.

So why don't you have a nice cup of STFU? ;-)

35 posted on 05/04/2012 7:35:44 PM PDT by kiryandil (turning Americans into felons, one obnoxious drunk at a time (Zero Tolerance!!!))
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To: Lurker
So they 'estimate' by talking to 60,000 out of 200,000,000 or so. Yea, that's scientific.

They could talk to 200,000,000. Is that your suggestion?

36 posted on 05/04/2012 8:09:40 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: kiryandil

Does this mean you won’t defend Williams? LOL!


37 posted on 05/04/2012 8:10:58 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Toddsterpatriot

Does this mean you’re still drinking and trolling? LOL!


38 posted on 05/04/2012 8:17:52 PM PDT by kiryandil (turning Americans into felons, one obnoxious drunk at a time (Zero Tolerance!!!))
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To: Toddsterpatriot

I didn’t make a suggestion. I called “bullshit” on their “estimated” numbers.

Which households are they calling? When are they calling them? Where are these households located? What exactly are these households being asked? Who’s doing the answering? What biases are inserted by those doing estimating?

Until you know the answers to these questions you’re talking out off your ass.


39 posted on 05/04/2012 8:24:09 PM PDT by Lurker (The avalanche has begun. The pebbles no longer have a vote.)
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To: kiryandil

I’m still pointing out idiocy.


40 posted on 05/04/2012 9:54:38 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Toddsterpatriot

You needn’t be so self-critical...


41 posted on 05/04/2012 10:20:04 PM PDT by kiryandil (turning Americans into felons, one obnoxious drunk at a time (Zero Tolerance!!!))
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To: Toddsterpatriot
You do seem to have an interesting history on FR.
42 posted on 05/04/2012 10:25:38 PM PDT by PA Engineer (Time to beat the swords of government tyranny into the plowshares of freedom.)
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To: Smokin' Joe

It does a monthly “Household Survey” of about 60,000 homes.

From that survey, and from other data like unemployment claims, the government estimates the total number of people working and the total number not working BUT looking for work.

They compute the “unemployment rate” based on those two numbers.


43 posted on 05/05/2012 2:54:55 AM PDT by zeestephen
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To: PA Engineer

It’s true, I’ve pointed out Williams’ idiocy before.


44 posted on 05/05/2012 7:29:46 AM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: PA Engineer
He's probably been banned before, too.

I remember seeing that, and laughing. Toddy gets so carried away with his own "wit" mostsometimes that he shoots his yap off to the wrong people.

It was a nice, quiet four months, with minimal incompetent verbal diarrhea on the economic threads. Unfortunately, Toddy's timeout is over now. :-)

45 posted on 05/05/2012 2:57:07 PM PDT by kiryandil (turning Americans into felons, one obnoxious drunk at a time (Zero Tolerance!!!))
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To: Smokin' Joe
As a practical question, how does the government count the people who are not receiving unemployment benefits? There are no people getting a check, so how do they keep track of people no longer in the system?

Please check the link to the FAQ's I posted in my #13, that started the parade of my admirers.

I'm not going to let a bunch of loud-mouths keep me from helping you to understand that unemployment compensation has nothing to do with the calculation of the unemployment rate. And to summarize, it's because not everyone is eligible for it.

So, if you are looking for a statistical snapshot of the population, in order to be scientifically valid you cannot limit the population you survey in that way (again, for reasons the BLS discusses in #13).

Well, you always could, but you would introduce bias. Now, that is completely a separate issue from the other ways that the BLS introduces bias into the calculation of the unemployment rate. But you shouldn't complain about oranges by talking about apples.

46 posted on 05/06/2012 5:50:51 AM PDT by 1rudeboy
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To: Toddsterpatriot

Hey, have you heard if that Anti-FReeper website is running its “Most Popular” contest this year? I have a title to defend.


47 posted on 05/06/2012 5:52:31 AM PDT by 1rudeboy
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To: kiryandil
And Willie took the choo-choo to Nowhere Land. And your other favorite FReeper took to posting about mindwaves, comets, and UFO's. Tough times for you indeed . . . I wonder what other economic forums you post on? Not likely any that have to do with liberty.
48 posted on 05/06/2012 5:56:46 AM PDT by 1rudeboy
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To: Toddsterpatriot

By the way, a lot of the regulars have gotten suspended. There can’t be that many of them that think it’s a big deal. It’s the people who re-register, or register multiple accounts so that they can “hide” that are homos.


49 posted on 05/06/2012 6:00:03 AM PDT by 1rudeboy
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To: Lurker
Which households are they calling? When are they calling them? Where are these households located? What exactly are these households being asked? Who’s doing the answering? What biases are inserted by those doing estimating?

Exactly, those and other questions about the statistical massaging done after they collect the survey “data,” all point up how this (U3 or other) number is just a SWAG that can be polished to be basically anything that is desired at a given point in time. I would suspect that close to 95% of people in this country think/believe that the widely reported U3 “number” is based upon some type of an actual count or accumulation of real “data” (with the vast majority believing that UE claim data makes up some substantial part of it).

Of course, the PTB like it that way. Keep 'em in the dark and feed 'em BS.

50 posted on 05/06/2012 6:23:29 AM PDT by zzeeman ("We can evade reality, but we cannot evade the consequences of evading reality.")
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