Where There’s Structural Smoke, There’s Economic Fire
Following up on this morning’s analysis of structural changes in the automobile markets globally, we see the same structural observations in the labor markets. If there does exist a strong relationship between household income and auto demand, and it is pretty clear that one does, what we find in employment trends is unsurprising. The latest .. read more
Stasis Is Not An Economic State
Economies either grow or they shrink, though shrinking is a misplaced word here. A real economic system is always moving forward, even during recession and dislocation. The word dislocation is used in modern economics where it probably does not belong, as well. The entire idea of a dislocation is antithetical to a real economy, being .. read more
Unemployment Claims and the Jobs Number Tell Us Nothing
Again, better than expected data buoys markets as the tepid recovery appears not to be worse than tepid. Today the Department of Labor reported a drop in initial jobless claims that seems to confirm the employment or jobs headline from last Friday. Low initial claims do tend to correlate with rising employment levels, so it .. read more
Jobless Claims Apparently Go Both Ways
From the Department of Labor, announcing a 5-year low in adjusted jobless claims: “The advance number of actual initial claims under state programs, unadjusted, totaled 436,766 in the week ending January 19, a decrease of 119,944 from the previous week. There were 416,880 initial claims in the comparable week in 2012.” [emphasis added] According to .. read more
Adjusted vs Unadjusted, Unemployment & Housing
More data from various sources on primary economic parameters seemingly at odds. First, unemployment claims dropped to a five-year low according to the adjusted BLS data series. At the opposite end, Gallup’s measure of employment fell, suggesting to Gallup that employment has gotten worse in January 2013. Since Gallup’s numbers are not adjusted, it, rightfully, .. read more
Job Recovery Pattern
This was the second consecutive employment report that featured a large increase in employment levels estimated by the Household Survey. After September’s +873k, October’s survey yielded a gain in overall employment of +410k. While this has caused a spurt of optimism, it is actually the second time just this year we have seen this pattern .. read more
Central Planners To The Rescue
The US stock market rose 2% last week based primarily on the perceived wisdom of various central economic planners around the world. Mario Draghi announced a new bond buying program in Europe designed specifically to circumvent the verdict of the market and prop up the governments of the peripheral countries. There are conditions which the .. read more
Weekly Economic & Market Review
Over the last couple of months I’ve dedicated a good portion of these weekly commentaries to the various headwinds I see facing the global economy and markets. Everyone, it seems, knows what the risks are and I’m beginning to wonder if, being so well known, the actual events may prove less jarring to sentiment than .. read more
