Avoid this no-account bind

Dear John: We just read your column about state confiscation laws, so we spoke to our bank to make sure it knows that my husband is still alive and kicking!

We personally monitor our required minimum distribution each year and visit the bank. The bank also sends 10 percent to the Internal Revenue Service.

One would think that these two steps each year by the bank are proof that the account is not dormant. Obviously, this is not enough for New York state, and that is why the bank sends a letter to my husband every three years — which is the time frame for confiscation in New York State.

It’s nice to knowthat the bank is looking out for us!

Thanks for keeping us informed about these important issues. You are the only one who does! Best regards, L.D.

Dear L.D. Let me share the credit on this one. The Investment Company Institute called and asked me to write about the fact that states are shortening the period after which they can confiscate people’s money in what they have determined are dormant accounts.

Quite frankly, I was shocked by the information I received. Half of the states can take your money if an account has been “dormant” for just three years. And “dormant” means that you haven’t had active contact with the company that holds the bank account, or mutual fund or moneymarket fund.

And your letter unintentionally brings up an interesting point. The ICI says New York is a fiveyear state — meaning Albany has to wait that long before it can declare that you have lost interest in your account. So if your bank is saying the time period is three years, it is probably because the bank is legally headquartered in a threeyear state such as Delaware or New Jersey.

The bottom line is, you need to be actively connected to your account. After I heard from the ICI, I immediately contacted a financial firm where I have an account that I haven’t been paying much attention to.

It’s not only getting harder to earn money, but also harder to keep it. Thanks for the note.

Dear John: Recently the government released its labor report, which it told us is “adjusted.”

In my opinion, government reports should be presented as is, without adjustments. Adjustments are merely estimates or guesses and are not factual.

It would be more sensible to me to compare the current actual nonadjusted report with the report for the same month last year, or for the same month of many years past.

If the current report is either better or worse than it was for the same month in one or more past years, it would be more transparent and realistic. I could then draw my own conclusion as to whether the report is good, bador neutral by comparing it to similar months of past years. Does my suggestion have merit, or am I missing something? D.G.

Dear D.G. Both — it has merit and you are missing something.

There is no hardandfast rule on this, but many of the government economic reports do give data prior to adjustment. You just have to dig for it and then do some math.

The monthly report on the number of new jobs, for instance, is adjusted. But if you know where to look, you can find a table that contains the actual number of jobs the Labor De partment believes exist in our economy.

That is adjusted somewhat in recent history — but not by a lot.

The problem is, that isn’t the number that the Labor Department reports.

More generally speaking, you do have to take into account that there are quirks in the economy that have to be allowed for. For instance, do you really want to see the June report suddenly show a big drop in jobs simply because teachers are off for the summer?

And then September will show a big increase, because they’ve gone back to work. So seasonal adjustments for things like this are necessary.

Let’s take the initial report on the quarterly gross domestic product as an example. That’s mostly guesswork. So if the Commerce Department didn’t adjust that with a couple more revisions, the number would be totally useless.

But there are problems with adjustments. The first is that they can be purposely manipulated by the bad guys. I assume that doesn’t happen much, but I also assume it can happen.

Another problem — and more relevant today — is that adjustments can be misleading, especially when patterns in previous years have shown anomalies.

Seasonal adjustments, for instance, find predictable patterns and then smooth out the data. But because of the last recession, and the fact that the barely improving recovery has been so unusual, these seasonal adjustments have been expecting patterns that haven’t happened.

In that case, the strict adherence to adjustments is misleading.

I think government agencies should continue to report adjusted figures. But they should make the unadjusted numbers more accessible. I shouldn’t need an expert at the Labor Department to find these tables.

The other problem is Wall Street. Traders jump on any numbers the government issues as though they were sacrosanct. These numbers are the thing that keeps food on their tables.

Government economists and statisticians would tell you not to trust numbers until they’ve been refined.

Wall Street sees the numbers as gold the minute they are released.