SubscribeVideo: The Kashkari Tortures (Episode 2292)
December 11, 2008
This was rough, but deserving. I don’t think that it’s a good bet that Treasury will be getting the remaining $350 billion anytime soon. This is painful to watch…
Rep. Manzullo Questions Tortures Bailout Czar Neil Kashkari
Employment Report - MUCH WORSE than reported
December 8, 2008
It is reported that the U.S. unemployment rate for November rose to a recent high of 6.7% of the population. The same report showed non-farm payrolls fell by 533,000… at least that is what the headline will initially lead us to believe. But taking a closer look into this report reveals a much more concerning trend of downward revisions and questionable accounting with many of the respondent components.
Last week we posted a projection of what to look for in the coming release and specifically pointed out that revisions to previous reports could be nasty as there is a regular time lag of the survey responses.
From the BLS release:
Nonfarm payroll employment fell sharply (-533,000) in November, and the unemployment rate rose from 6.5 to 6.7 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. November’s drop in payroll employment followed declines of 403,000 in September and 320,000 in October, as revised. Job losses were large and widespread across the major industry sectors in November.
Our friends at Trim Tabs (Scheduled TDI Podcast guest ) have continued to challenge the BLS and their methodology as they have found several flaws and broad inaccuracies in that: Read more
Jobless Claims - Piling on the bad news
December 5, 2008
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Initial jobless claims are a measure of the number of individuals filing for unemployment benefits for the first time. Surprisingly, the number of claims was much better then expected yesterday at 509k versus the consensus of 540k claims filed. Does this mean we are starting to turn the corner?
We are not that optimistic. There are many factors to consider in this report especially the timing. As we are approaching the the holidays, many retail companies will retain employees up until the last moment of the season, hoping to serve as many customers needs as possible. Odds are that we will begin to see a significant increase in layoffs after January 1. Read more
Preview to Unemployment and Delicious Del Monte
December 4, 2008
Markets may have rallied today due to a feeling of hope and change that the automotive industry may finally come to a bailout agreement with congress. It appears that this will be nothing more than a short-term fix for another ailing industry. Unfortunately, we still have several enormous economic problems to face beyond this.
In particular, while the government has been there to help with seemingly unlimited reach, we can not simply continue with bailouts forever without increasing taxes or some other extraordinary measure to increase revenues for Uncle Sam.
Assisting the big three automakers may be a temporary band aid to help stem job losses in Detroit and associated industries, but something will need to change to get these companies back to profitability and more layoffs are sure to come. Read more
Auto Industry Promises: Can We Trust Them?
December 3, 2008
The headlines are all a bustle over the drama that will likely unfold this week when the Beggars of Detroit come to visit the Interrogators of D.C. Perhaps the most concerning part of this bailout is that the facts keep changing.The latest reports show that the original $2 billion monthly burn rate estimate for GM has increased to $5 billion per month. It is frightening to learn now that the estimate is already outdated. In fact, MSNBC is reporting today that if General Motors (GM) is to survive 2008, they will need an initial $4 Billion and another estimated, $18 Billion in total U.S. assistance.
In what appears to be a virtual checkmate, the auto companies are making a show of their proposal by complying with the politically correct and the outcrys of all Americans to win over billions of dollars of funding. It has been made quite clear that most Americans do not want to give another cent to zombie companies that have a history of losing money in even the best economic times. But give we will. Let’s take a look at some of the latest news and read between the lines to figure out what is really going on.
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