Wall Street doesn't take kindly to mistakes. That's because confidence is paramount to the market, and investors need openness and honesty in the numbers to have faith that their money isn't part of a Ponzi scheme or in some Nigerian prince's bank account.

A company that misstates earnings or sales even accidentally is severely punished as doubt eats away at investors like a cancer. So just imagine what it would mean for the market if the broader economic figures we've been given have been calculated with fuzzy math -- and that government statisticians have been off in their numbers as far back as 2008. The word "crash" is just one of many ugly words that come to mind.

This could be the exact scenario we will face Friday with the latest payroll numbers. According to recent reports, such as this great one with interactive graphics from Bloomberg, the Labor Department may revise previous payroll data dramatically lower -- to the tune of more than 820,000 jobs "lost." From April 2008 to March 2009, it appears the labor market was in much worse shape than Uncle Sam admitted at the time.

At the heart of this problem is the "birth/death" model of tracking that assumes that as businesses close, others start up to take their place. Maybe not in the same town or even in the same industry, but someone somewhere will step up. And research showed the net gain or loss in jobs was pretty minimal, so the only thing worth tracking was the growth or loss within existing businesses. Obviously this hasn't been an ideal environment to start a bakery or a boutique, and new businesses have not been able to generate the number of jobs lost as companies everywhere have gone under.

As full disclosure, I must point out that revisions occur every February to reflect reporting changes. And I'm actually all in favor of the annual revision, since it adjusts numbers to make sure we all have the best and most up-to-date data. However, an 820,000 change would be the largest in 18 years. And worst of all, the Labor Department has no plans to do anything different to its model in 2010. That means the current reports we are getting could be incorrect.

If this revision is as steep as predicted, even if the January payroll numbers are up and show jobs added for the first time since the beginning of the recession, a massive downward revision will steal the show.

Conspiracy theorists will have a field day over the bogus data that were reported for more than a year, and with good reason. Nobody likes to invest based on a mistake.

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