Monday , February 17 2020
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Tag Archives: payrolls

PayLOLs

President Trump mentioned the unemployment rate seven times during his third State of the Union address delivered on Tuesday. It was obvious why he did (though I had expected twice that number). His reelection largely stands on where enough people believe the economy stands. He was, after all, elected four years ago to fix what had been a very real economic mess. Has he fixed it? That’s the question and it is not a partisan issue. The unemployment rate is, however, and it was made one...

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Less Shine In The Sentiment Formula

The IMF yesterday downgraded its forecasts for global growth as well as its real GDP estimates for all the big economy regions. The organization now thinks GDP growth might have amounted to 2.9% last year. Not only the worst year since 2009, that was down from April 2019 approximations of 3.6% and the original forecasts which always start out near 4%. Worse, estimates for this year are being trimmed. Though pretty much everyone has become more optimistic about the global economy, what does...

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Very Rough Shape, And That’s With The Payroll Data We Have Now

The Bureau of Labor Statistics (BLS) has begun the process of updating its annual benchmarks. Actually, the process began last year and what’s happening now is that the government is releasing its findings to the public. Up first is the Household Survey, the less-watched, more volatile measure which comes at employment from the other direction. As the name implies, the BLS asks households who in them is working whereas the more closely scrutinized Establishment Survey queries establishments...

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Disposable (Employment) Figures

If last month’s payroll report was declared to be strong at +128k, then what would that make this month’s +266k? Epic? Heroic? The superlatives are flying around today, as you should expect. This Payroll Friday actually fits the times. It wasn’t great, they never really are nowadays (when you adjust for population and participation), but it was a good one nonetheless. November 2019, according to the BLS, was the first month since January to register better than +220k in payroll gains. That...

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Further The Zombie Bubble

The Bureau of Economic Analysis (BEA) has revised its preliminary estimate of GDP. That can only mean one thing: time to look at corporate profits again. Included along with the recalculated headline output estimate is the BEA’s first run of profit figures. If you are Jay Powell, you aren’t going to like what you find. First, real GDP in the third quarter was practically unchanged. Revised from around 1.90% (continuously compounded annual rate of change) to a touch above 2.10%, either of...

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Rate Cuts, Repo, and (No) Money Printing

I don’t think that was quite the message the FOMC wanted to send. It’s pretty clear what the Committee wanted to say, or wanted everyone to hear. The members are done with rate cuts because everything looks great. Sure, it all looked great to them last year but, as has become the conventional interpretation of late, hey, at least it didn’t get worse. That’s where we are in this “cycle”, cheered up presumably by the lack of fulfilled downside. However, despite the apparent emphasis on...

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For Labor And Recession, The Bad One

There’s a couple of different ways that Unit Labor Costs can rise. Or even surge. The first is the good way, the one we all want to see because it is consistent with the idea of an economy that is actually booming. If workers have become truly scarce as macro forces sustain actual growth such that all labor market slack is absorbed, then businesses have to compete for them bidding up the price of marginal labor. This is, of course, the exact scenario we’ve been constantly hearing about ever...

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Stuck In Between: No Recession Today, But No Turnaround, Either

There wasn’t much by way of the ISM’s Manufacturing PMI to allay fears of recession. Much like the payroll numbers, an uncolored analysis of them, there was far more bad than good. For the month of October 2019, the index rose slightly from September’s decade low. At 48.3, it was up just half a point last month from the month prior. Most of that was related to a curious surge in New Export Orders. Having dropped to just 41.0 in September, this component rebounded more than nine points to 50.4...

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Red Flags All Over It-Wasn’t-Worse Payroll Friday

Better-than-expected is the new strong. Even I’m amazed at the satisfaction being taken with October’s payroll numbers. While you never focus too much on one monthly estimate, this time it might be time to do so. But not for those other reasons. Sure, GM caused some disruption and the Census is winding down, both putting everyone on edge. The whisper numbers were low double digits, maybe even a negative headline estiamte. Markets had been riding pure pessimism beforehand, with inverted curves...

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Three (Rate Cuts) And GDP, Where (How) Does It End?

The Federal Reserve has indicated that it will now pause – for a second time, supposedly. Remember the first: after raising its benchmark rates apparatus in December while still talking about an inflationary growth acceleration requiring even more hikes throughout 2019, in a matter of weeks that was transformed into a temporary suspension of them. Expecting the easy disappearance of “transitory” factors, that Fed pause was to be followed by the second half rebound and eventual if careful...

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