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Posts Tagged ‘BLS’

John Williams Discusses The Reasons For The Upcoming Dollar Dump

Courtesy of Tyler Durden

Lately, anywhere we look, there seems to be a pattern emerging: those economic thinkers who actually construct and run their own macro models (not the glorified powerpoint presenter variety) and actually do independent analysis and tracing of the money flow, instead of relying on Wall Street forecasts that have as much credibility as a Moody’s home price hockey stick from 2006, almost inevitably end up having a very dire outlook on the economy. One such person is and has pretty much always been Shadowstats‘ John Williams, whose "shadow" economic recreation puts the BLS data fudging dilettantes to shame. That said any reader of Zero Hedge who has been with us for more than a few weeks, knows all too well our eagerness to ridicule the increasingly more incoherent lies coming out of the US department of truth, so no surprise there. Yet another aspect over which there is much agreement is that no matter how one slices the data, the outcome for the US currency is a very grim one. Which is why Williams over the past several years has become a major fan of the shiny metal. Below we recreate portions of his latest observations on the upcoming currency collapse, courtesy of King World News.

John Williams today was dispatching information regarding gold, silver, M3, nearby massive selling of dollars and inflation.  Here is a portion from his commentary, “Despite November 9th’s historic high gold price of $1,421.00 per troy ounce (London afternoon fix) and the multi-decade high silver price of $30.50 per troy ounce (London fix) on December 7th, gold and silver prices have yet to approach their historic high levels, adjusted for inflation.”

Real Money Supply M3:  The signal of the still unfolding double-dip recession, based on annual contraction in the real (inflation-adjusted) broad money supply (M3), continues and is graphed (above).  Based on today’s CPI-U report and the latest estimate on the November SGS-Ongoing M3 Estimate, that annual contraction in November 2010 was 4.0%, narrower than October’s 4.5% contraction, and May’s post-World War II record annual decline of 7.9%.

Incidentally, if there is one thing we disagree with John on is that the broadest aggregate (M3 for Williams, Shadow Banking for Zero Hedge) is declining. That said, an expansion in the most critical broad money signal is merely the missing piece of the puzzle that we…
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Monthly Inflation Update

Monthly Inflation Update 

Courtesy of Doug Short 

The latest annualized rate is 1.15%.

The August 2010 Consumer Price Index for Urban Consumers (CPI-U) is 218.312. The annualized inflation rate computed from this number is 1.15%, which marks the tenth month of mild inflation after a streak of eight consecutive months of deflation. The annualized inflation rate is well below the 3.99% average since the end of World War II.

The Bureau of Labor Statistics (BLS) has compiled CPI data since 1913 (BLS historic data). Our chart now shows inflation back to 1872 by adding Warren and Pearson’s price index for the earlier years. The spliced series is available at Yale Professor Robert Shiller’s website. This look further back into the past dramatically illustrates the extreme oscillation between inflation and deflation during the first 70 years of our timeline. Click here for additional perspectives on inflation and the shrinking value of the dollar.

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Here is a link to an overview of inflation, recessions and the S&P 500 since 1950.

Alternate Inflation Data 
The latest annualized rate is 8.50%.

The chart below (click here for a larger version) includes an alternate look at inflation without the calculation modifications the 1980s and 1990s (Data from www.shadowstats.com).

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Click for a larger image

As I’ve expressed elsewhere, my opinion is that the optimum method for calculating consumer prices is probably somewhere between the revised BLS method and the historic method preserved by Williams. However, government policy, the Federal Funds Rate, interest rates in general and decades of major business decisions have been fundamentally driven by the official BLS inflation data, not the alternate CPI. For this reason I think it best to take the alternate inflation data as a interesting, but not authoritative. 


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What is The Real Rate of Unemployment in the United States?

What is The Real Rate of Unemployment in the United States?

Courtesy of Larry Doyle at Sense on Cents

Just what is the true rate of unemployment in our country? Our headline U-3 rate is currently 9.5%. Our U-6 rate, more broadly defined, is 16.5%.

Many people are aware of the differences between U-3 and U-6; however, renowned economist John Williams takes our analysis to an entirely new level. Williams is far ahead of the curve in his work.

William is likely not a regular on the Washington cocktail circuit. Why’s that? He goes far deeper in his work and exposes inconsistencies, if not worse, in government statistics. Let’s learn more about Williams and his work at Shadow Government Statistics:

Walter J. “John” Williams was born in 1949. He received an A.B. in Economics, cum laude, from Dartmouth College in 1971, and was awarded a M.B.A. from Dartmouth’s Amos Tuck School of Business Administration in 1972, where he was named an Edward Tuck Scholar. During his career as a consulting economist, John has worked with individuals as well as Fortune 500 companies.

Formally known as Walter J. Williams, my friends call me John. For nearly 30 years, I have been a private consulting economist and, out of necessity, had to become a specialist in government economic reporting.

One of my early clients was a large manufacturer of commercial airplanes, who had developed an econometric model for predicting revenue passenger miles. The level of revenue passenger miles was their primary sales forecasting tool, and the model was heavily dependent on the GNP (now GDP) as reported by the Department of Commerce.

Suddenly, their model stopped working, and they asked me if I could fix it. I realized the GNP numbers were faulty, corrected them for my client (official reporting was similarly revised a couple of years later) and the model worked again, at least for a while, until GNP methodological changes eventually made the underlying data worthless.

That began a lengthy process of exploring the history and nature of economic reporting and in interviewing key people involved in the process from the early days of government reporting through the present.

For a number of years I conducted surveys among business economists as to the quality of government statistics (the vast majority thought it was pretty bad), and my results led to front page stories in the New York


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ADP vs. BLS Job Reports – Who to Believe?

ADP vs. BLS Job Reports – Who to Believe?

Courtesy of Mish

The ADP July National Employment report is out. Let’s take a look.

Private sector employment increased by 42,000 from June to July on a seasonally adjusted basis, according to the latest ADP National Employment Report® released today.

July’s rise in private employment was the sixth consecutive monthly gain. However, over those six months increases have averaged a modest 37,000, with no evidence of acceleration.

click on chart for sharper image

Large Businesses Added Zero Jobs

The chart shows that small and medium businesses added jobs while large businesses added a grand total of zero.

If small business hiring turns down, and I think it will, ADP is going to start reporting negative job growth.

Small Business Sentiment

The reason I expect a relapse in that small business jobs is small business sentiment is in the gutter as evidenced by recent Gallup Polls.

If large businesses are not hiring and small businesses do not increase hiring (or worse yet stop hiring), it’s quite hard to be optimistic about jobs.

Hiring Not Improving

One of the things in the ADP report that caught my eyes was this short paragraph:

"July’s rise in private employment was the sixth consecutive monthly gain. However, over those six months increases have averaged a modest 37,000, with no evidence of acceleration."

The key words in that paragraph are "no evidence of acceleration". It is consistent with the small business surveys mentioned above.

ADP vs. BLS Reports

Inquiring minds may be interested in seeing a comparison between ADP and the BLS (government) reports.

A direct number to number comparison using the standard BLS report is inaccurate because ADP reports private nonfarm jobs while the BLS reports all nonfarm jobs. The latter is tremendously skewed this year by census hiring and firing. It is also skewed by normal government hiring and firing.

Fortunately, the BLS does provide the private numbers in Excel format, so with minimal work an accurate comparison is possible.

Let’s go back to January and see what the data looks like year to date.

Private Nonfarm Jobs – BLS vs.


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BLS Owner’s Equivalent Rent Numbers From Twilight Zone

BLS Owner’s Equivalent Rent Numbers From Twilight Zone

Courtesy of Mish

In Bill Gross Bets On Deflation I posted some links on falling rent prices courtesy of Lansler on Real Estate. Here is a recap.

Rents Falling Everywhere

Given that the official measure of CPI is based on rents not housing prices, please consider the following collection of links courtesy of Lanser on Real Estate: Really? Rents fall almost everywhere.

Falling Rents In Puget Sound

Over the weekend several people sent me a link about rents in the Seattle area. Please consider Apartment rents falling in Puget Sound area.

A shrinking number of jobs and a growing supply of apartments will continue to push the Puget Sound region’s rents down next year as vacancy rates climb, industry experts predict.

Job losses killed our market, and development buried it," Mike Scott, of Dupre + Scott Apartment Advisors, told landlords at an industry conference Tuesday.

The average monthly rent across all apartment types in King, Pierce and Snohomish counties fell from $988 to $959 during the 12 months ending in September, and a continuing decline through 2011 will further cut that figure to $889, Dupre + Scott projects.

While demand for apartments is falling, the supply is rising.

So far, 4,100 new units have opened this year, and more than 2,000 others are expected to become available by year-end, according to Dupre + Scott.

The firm estimates that about 20 percent of the 6,000 condos completed in the past three years are also on the rental market now.

The combination of job losses and new units has upped the region’s vacancy rates from 6.6 percent last spring to 7.2 percent now, and heading toward 9 percent next year, the firm said.

To attract renters, landlords


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Zero Hedge

United States Of Newspeak - Obama Spins Executive Orders As "Presidential Memoranda" To Avoid Scrutiny

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by Mike Krieger via Liberty Blitzkrieg blog,

If there’s one thing we have learned about Barack Obama, it’s that he is a master of deception and absolutely loves to lie to the public. He seems to enjoy conning the plebs to such a degree, I think he actually receives blasts of dopamine every time he does it. The bigger the lie, the better the rush.

The latest example relates to his issuance of executive orders, or lack thereof, something that Obama Inc...



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Phil's Favorites

Competitive Theories: "Deflation Warning" vs. "Inflation is Nearly Everywhere"

Courtesy of Mish.

Theory #1: Break-Even Rates Provide "Deflation Warning"

Bloomberg is sounding a Deflation Warning as 2-Year Break-Even Rates Go Negative.

Break-even rates are the difference between treasuries and the same-duration Treasury Inflation-Protected Securities (TIPS). The break-even rate turned negative yesterday for the first time since 2009.

In theory, break-even rates reflect investors’ expectations for inflation over the life of the securities.

When break-even rates are negative, it's an indication investors expect price deflation for the duration, in this case for two years.

From Bloomberg ...
The drop in the break-even rate followed a Labor Depart...



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All About Trends

Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Chart School

Relief Bounce in Markets

Courtesy of Declan.

Those who took advantage of markets at Fib levels were rewarded.  However, this looked more a 'dead cat' style bounce than a genuine bottom forming low.  This can of course change, and one thing I will want to see is narrow action near today's high. Volume was a little light, but with Christmas fast approaching I would expect this trend to continue.

The S&P inched above 2,009, but I would like to see any subsequent weakness hold the 38.2% Fib level at 1,989.


The Nasdaq offered itself more as a support bounce, with a picture perfect play off its 38.2% Fib level. Unlike the S&P, volume did climb in confirmed accumulation. The next upside c...

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Digital Currencies

Chart o' the Day: Don't "Invest" in Stupid Sh*t

Joshua commented on the QZ article I posted a couple days ago and perfectly summarized the take-home message into an Investing Lesson. 

Chart o’ the Day: Don’t “Invest” in Stupid Sh*t

Courtesy of 

The chart above comes from Matt Phillips at Quartz and is a good reminder of why you shouldn’t invest in s...



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OpTrader

Swing trading portfolio - week of December 15th, 2014

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Sabrient

Sector Detector: Energy sector rains on bulls' parade, but skies may clear soon

Reminder: Sabrient is available to chat with Members, comments are found below each post.

Courtesy of Scott Martindale of Sabrient Systems and Gradient Analytics

Stocks have needed a reason to take a breather and pull back in this long-standing ultra-bullish climate, with strong economic data and seasonality providing impressive tailwinds -- and plummeting oil prices certainly have given it to them. But this minor pullback was fully expected and indeed desirable for market health. The future remains bright for the U.S. economy and corporate profits despite the collapse in oil, and now the overbought technical condition has been relieved. While most sectors are gathering fundamental support and our sector rotation model remains bullish, the Energy sector looks fundamentally weak and continues to ran...



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Stock World Weekly

Stock World Weekly

Newsletter writers are available to chat with Members regarding topics presented in SWW, comments are found below each post.

Here's this week's Stock World Weekly.

Click here and sign in with your user name and password. 

 

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Option Review

SPX Call Spread Eyes Fresh Record Highs By Year End

Stocks got off to a rocky start on the first trading day in December, with the S&P 500 Index slipping just below 2050 on Monday. Based on one large bullish SPX options trade executed on Wednesday, however, such price action is not likely to break the trend of strong gains observed in the benchmark index since mid-October. It looks like one options market participant purchased 25,000 of the 31Dec’14 2105/2115 call spreads at a net premium of $2.70 each. The trade cost $6.75mm to put on, and represents the maximum potential loss on the position should the 2105 calls expire worthless at the end of December. The call spread could reap profits of as much as $7.30 per spread, or $18.25mm, in the event that the SPX ends the year above 2115. The index would need to rally 2.0% over the current level...



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Market Shadows

Official Moves in the Market Shadows' Virtual Portfolio

By Ilene 

I officially bought 250 shares of EZCH at $18.76 and sold 300 shares of IGT at $17.09 in Market Shadows' Virtual Portfolio yesterday (Fri. 11-21).

Click here for Thursday's post where I was thinking about buying EZCH. After further reading, I decided to add it to the virtual portfolio and to sell IGT and several other stocks, which we'll be saying goodbye to next week.

Notes

1. th...



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Pharmboy

Biotechs & Bubbles

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Well PSW Subscribers....I am still here, barely.  From my last post a few months ago to now, nothing has changed much, but there are a few bargins out there that as investors, should be put on the watch list (again) and if so desired....buy a small amount.

First, the media is on a tear against biotechs/pharma, ripping companies for their drug prices.  Gilead's HepC drug, Sovaldi, is priced at $84K for the 12-week treatment.  Pundits were screaming bloody murder that it was a total rip off, but when one investigates the other drugs out there, and the consequences of not taking Sovaldi vs. another drug combinations, then things become clearer.  For instance, Olysio (JNJ) is about $66,000 for a 12-week treatment, but is approved for fewer types of patients AND...



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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!




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