- Ugh, man.

(light upbeat music) I'm having a tough time researching this new "Two Cents" script.

- Why?

- Well, you probably heard that Trump fired the Head of the Bureau of Labor Statistics.

- Right, they published some job numbers that suggested the economy wasn't as strong as we thought, and he said they were "rigged."

- But we rely on those numbers to understand where the economy is headed.

I mean, in fact, you'd be hard-pressed to find an episode in our back catalog that didn't use the BLS as a source at least once.

I mean, my whole lifetime, it's been the gold standard for unbiased, non-partisan economic information.

I mean, if I can't trust the BLS, how can I finish this script?

How can we advise our clients?

How can we plan for the future?

- Okay, okay, calm down.

There are other metrics for gauging the state of the economy.

- Other metrics?

Well, what are they?

Tell me.

I need metrics.

- Well, I gotta warn you, they can get a little weird.

(exciting music) (air boinging) (pig snorting) We all know that people tighten their belts when times are tough, but there might be another economic indicator below the belt.

Alan Greenspan, the former chair of the Federal Reserve, famously proposed men's underwear sales as a potential gauge of economic health.

The thinking goes that since it's the one piece of clothing that no one sees, it's the first garment purchase that households forego when they have to cut back.

This is just one of many strange and dubious statistics that have been floated as a window into the financial mindset of the American people, and it's not the only one related to clothing.

- Another theory, which supposedly dates back to the 1920s claims that the average length of women's dresses and skirts reflects the health of the economy.

The hemline index, as it's known, does seem to have some anecdotal validity, but not much of an explanation, other than that maybe people tend to feel more confident and carefree when times are good?

- To stay on women's fashion, the lipstick effect suggests that when sales of certain beauty products go up, it could be a warning sign for the economy.

In 2001, the Chair of cosmetics giant Estee Lauder noticed that lipstick sales increased after the September 11th terrorist attacks, and a similar rise was noticed during the aftermath of the 2008 financial crisis.

He theorized that as people cut back on larger luxuries, they actually allow themselves more of the smaller affordable luxuries like lipstick.

- This is not too different from a perceived trend in snack foods.

Many snack companies report a decline in sales during a recession, as people focus their grocery budgets on the necessities.

Except for candy, which can sometimes see an increase in sales.

Perhaps people need a pick-me-up during tough times, or maybe they consider candy to be more a bang for their buck than chips and crackers.

- Alcohol sales follow a similar pattern.

As consumers feel the pinch, they tend to prefer cheaper beverages like beer over say, pricey bourbon.

Some liquor distributors report higher sales of mini bottles during recessions, like the kinds you get on airplanes, as drinkers try to scratch the itch without breaking the bank.

- As long as we're talking vice, some claim that the income of exotic dancers can be used as an economic bellwether.

These so-called stripper index implies that workers at gentleman's clubs may feel a recession coming sooner than the rest of us, as their clients feel less inclined to make it rain.

The ladies on those poles might be a little curvier than usual, however, thanks to a supposed preference among men for fuller-bodied women during recessions, some think this is a subconscious reaction to resource scarcity--that is, when times are tough, the waifish look just reminds you of malnourishment.

- However, it correlates to a study that tracked the physical characteristics of celebrities through the second half of the 20th century and found that when times were good, the public preferred performers with childlike features with large eyes, small chins, and thin waists.

During times of economic stress, however, they preferred more mature features, small eyes, broad chins, and thicker physiques.

The theory is that when you are feeling insecure, the presence of adults can be psychologically reassuring.

- Coffee is often considered an inelastic good.

That is, demand for it stays the same despite price and income changes.

No matter how bad the economy gets, people gotta have their morning joe.

However, if your local coffee shop seems a little slower than usual, that can be an economic red flag, and not only because people are cutting back on $6 lattes.

Coffee shops are where people go to work and to have meetings, sometimes even on Zoom-- you know who you are.

If there's less business activity in general, you're likely to see that reflected in those empty tables.

- With more people staying at home, it makes sense that some dating apps report higher usage when the economy sours.

After all, you've got more time to sit and swipe.

But I'm not sure if those people are actually going out on dates, since deodorant sales tend to drop during a downturn.

Adversely, the sales of laxatives will often rise, perhaps because we're all feeling a little backed up.

- In 1999, British economist Andrew Lawrence proposed a correlation between economic downturns and the development of super tall buildings, known today as the skyscraper effect.

The theory is that these kinds of mega projects get financed only when the economy is running super hot and ready for a bust.

And there is some pretty persuasive evidence, like the completion of the Empire State Building at the beginning of the Great Depression and the construction of both the World Trade Center and the Sears Tower just before America suffered a decade of debilitating stagflation.

- Currently, there is a building project slated in Oklahoma City that will be the tallest skyscraper in the US, and here in Austin, construction is in the final stages on what is now the tallest building in Texas.

But we are not about to convert our stocks to gold just yet because the skyscraper index and all these other metrics are hardly reliable enough to base financial decisions on.

- Not only is the data difficult to compile-- how much of an exotic dancer's income is actually reported?

- -but there can be countless other variables that influence trends.

Alcohol and snack sales may be falling because people are trying to be healthier, and maybe Timothee Chalamet and Anya Taylor-Joy are famous because of their immense talent, not their immense eyeballs.

- Most of these metrics are anecdotal at best, and while they may be fun to consider, they are no match for the kind of rigorously collected and analyzed data produced by the Bureau of Labor Statistics.

It's often referred to as a public good because it's of great practical value and available for free to anyone who wants it.

From policymakers to small business owners, Wall Street stockbrokers to ordinary Americans wondering if it's a good time to buy a house.

- [Julia] That's why it would be such a loss if organizations like the BLS and the Census Bureau came to be regarded (crowd jeering) as biased or unreliable.

- Other countries that were suspected of meddling with their economic data suffered serious consequences.

In 2007, the Argentinian government fired a top statistician for reporting sharply rising inflation and replaced her with a political loyalist who published much rosier numbers.

Not only did the Argentinian people not buy it, but global investors shunned the country, rightly worried they couldn't do business in the dark.

- Similarly, Greece admitted to falsifying their economic data in 2004 in order to join the European Union.

As a result, lenders charged them exorbitant borrowing fees, and they had to institute severe austerity measures that led to widespread protests and riots.

(crowd jeering) - Could the same thing happen here?

Most economists agree that it would be very difficult for any director to rig the BLS numbers because they are compiled by a vast team of non-partisan employees.

However, if the bureau underwent the same kind of large scale workforce purge as other government agencies, some think the data could over time end up being influenced by politics.

- At the end of the day, even the suggestion of bias can do damage since it can create the kind of insecurity and murkiness that stifles growth.

- For now, official US data on the economy is still as reliable a metric as you can find, but in the future, if you happen to see an economist measuring women's skirts, it might be time to worry.

- And maybe call the police.

- [Both] And that's our "Two Cents."