SubscribeDHUnplugged # 78 – Is the “Big One” Coming?
August 26, 2010
Here is our latest conversation …. new insights for anyone who invests in anything. This week the housing market goes back into the dumper. I double dip in the cards?.
NEW! NEW! We are now tracking the idea stock that Andrew and John highlight in each episode. Here is the link…
Listen to reasons why and then take a look at the spreadsheet for results. Delicious tags: News and item discussed in this episode – CLICK HERE
CLICK HERE TO LISTEN TO EPISODE # 78
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Another Week, Another Weak ______ (Fill in the Blank)
August 26, 2010
Another week, another weak employment number. That is on top of a weak durable number and dreadful housing reports. There is clearly a dearth of desire for companies to begin hiring programs as there is such a general sense of uncertainty that has permeated individuals and companies.
These are the times that we need to worry about the most as consumers have companies (through capital expenditures) and consumers (through general spending) could put a quick stop to any spending.
Yet, once again headlines promoted the idea that continuing claims are slowly coming down. We are here to say, once again that this is just plain wrong. Of course if you choose to look at only part of the picture, then that is fine. But perhaps a look at the chart below will provide clear evidence that there is a rise that needs to be included from the extended and emergency claims.
The bottom line is that claims are claims. The government should adjust the “official” continuing claims to include ALL claims. But they won’t as they know how terrible that will look.
Jeff Rosen had a great commentary of this…
A breakout from the ongoing stagnation in the labor market remains elusive as the initial claims level fell during the week, but remained firmly grounded between 450,000 and 500,000 claimants as it has done just about every week since the middle of November 2009.
There has been nothing to suggest that the claims level will suddenly strengthen and fall below the lower bound any time soon. In last week’s Data Detail, we mentioned that the declines in temporary census worker payrolls could have masked a drop in private sector firings. We used that analysis to suggest that the rise back up to the 500,000 upper bound was temporary and we expected claims to fall below 450,000 as soon as census worker employment stabilized.
Unfortunately, the removal of temporary census workers last week was not the cause of the heightened initial claims level. For the first time since the week ending July 17, net census payrolls increased during the week. This means the contribution from census workers to the initial claims level was minimal, and private firings remain at a heightened level.
The Department of Labor confirmed these findings by issuing a statement this week saying there were no unusual factors that caused last week’s claims level to rise to 500,000.
Looking at this week’s data, unless there was an unexpected influx of census workers, the private sector again provided the bulk of the newly laid-off workers. Even with the overall decline, these numbers suggest that our early projections of a 50,000 gain in nonfarm payrolls in August are probably too high and we may see payroll growth closer to zero.
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In last week’s Data Detail, we mentioned that the declines in temporary census worker payrolls could have masked a drop in private sector firings. We used that analysis to suggest that the rise back up to the 500,000 upper bound was temporary and we expected claims to fall below 450,000 as soon as census worker employment stabilized.
Unfortunately, the removal of temporary census workers last week was not the cause of the heightened initial claims level. For the first time since the week ending July 17, net census payrolls increased during the week. This means the contribution from census workers to the initial claims level was minimal, and private firings remain at a heightened level.
The Department of Labor confirmed these findings by issuing a statement this week saying there were no unusual factors that caused last week’s claims level to rise to 500,000.
Looking at this week’s data, unless there was an unexpected influx of census workers, the private sector again provided the bulk of the newly laid-off workers. Even with the overall decline, these numbers suggest that our early projections of a 50,000 gain in nonfarm payrolls in August are probably too high and we may see payroll growth closer to zero.A breakout from the ongoing stagnation in the labor market remains elusive as the initial claims level fell during the week, but remained firmly grounded between 450,000 and 500,000 claimants as it has done just about every week since the middle of November 2009. There has been nothing to suggest that the claims level will suddenly strengthen and fall below the lower bound any time soon.
In last week’s Data Detail, we mentioned that the declines in temporary census worker payrolls could have masked a drop in private sector firings. We used that analysis to suggest that the rise back up to the 500,000 upper bound was temporary and we expected claims to fall below 450,000 as soon as census worker employment stabilized.
Unfortunately, the removal of temporary census workers last week was not the cause of the heightened initial claims level. For the first time since the week ending July 17, net census payrolls increased during the week. This means the contribution from census workers to the initial claims level was minimal, and private firings remain at a heightened level.
The Department of Labor confirmed these findings by issuing a statement this week saying there were no unusual factors that caused last week’s claims level to rise to 500,000.
Looking at this week’s data, unless there was an unexpected influx of census workers, the private sector again provided the bulk of the newly laid-off workers. Even with the overall decline, these numbers suggest that our early projections of a 50,000 gain in nonfarm payrolls in August are probably too high and we may see payroll growth closer to zero.
Links and Reading for August 26th
August 26, 2010
Some of the more interesting and important items for August 26th :
- 500 Internal Server Error – 500 Internal Server Error
- U.S. millionaire index turns sharply bearish | Reuters –
- FOXBusiness.com – Analyst: Citigroup Is Cooking the Books – No Kidding
- Existing Home Sales Horrendous – So, Why Are Housing Stocks Moving Higher? : The Disciplined Investor – Interesting moves in the Housing sector today
- Australia May Ax Mining Tax After Labor Fails to Win Majority in Election – Whatever is good for the election, no matter how bad for th people
Take 2: New Home Sales Awful – Home Builders are Rallying
August 25, 2010
There was a disconnect yesterday and perhaps it was simply that the homebuilders have been beaten down so much than even bad news can’t hurt them at this point.
What bad news? Well aside for the 27% slide in existing Read more
TDI Podcast 175: Shorting the Yen and Thoughts From Minyanville
August 25, 2010
Guest: Kevin DePew, Minyanville discusses a god amount of charting technique as well as direction for various markets and commodities. Silver, Gold, markets and more. Also a closer look at the economics vs. earnings debate.
View the 14-minute Virtual Tour of the TDIMG Strategy
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Links
