Many of the same arguments were made in the early 1990's as job growth, by definition a "lagging indicator," before the economy grew so strongly it created millions of jobs too many. There was not enough demand for the capacity to produce that was developed by the end of the 1990's. That is a scenario that takes place in a cyclical economy every time in that part of the cycle. Only at the end of the 1990's, the internet bubble, the y2k scare, and other similar events made it more severe than in the past. It is only natural that after the bubble burst and the economy shed capacity to meet lower demand during the recession that it take a while to regroup and have any need for new capacity that is necessary for job growth. Also huge variables in the strength of the recovery were 9/11 and corporate scandals; variables most of this board are choosing to leave out due to their partisanship. Now, over the last 6 months there has been steady growth in jobs that has now even surpassed the level needed just to absorb new workers, a fact that is also being ignored on this board. Many of your arguments were true about the state of the economy but are not valid with the addition of recent economic data and they lack context in that they don't take into account 9/11, the war, and other variables.
Folks, in one hand, it is stated there were over 308,000 new jobs this last month, on the other hand, the unemployment rate has gone up! Whewwww! What does that mean? Did I miss something? How could the 308k then be good news?
I know of high tech industry people, with top degrees from the very top engineering schools, out of job for over a year, sometimes more. Where do we want to send MIT grads to get new training??? McDonald University?
-- Modified on 4/3/2004 11:40:39 PM
I understand that figure came from such tactics as the govt. reclassifying burger flipping as 'manufacturing' - after all, them burgers don't make themselves.....
Even reclassifying the type of job does not change the number from 308,000 new jobs being breated in March and, by the way, January and February were both revised upward showing that as new information is received the government realizes that more jobs were created than first thought.
The unemployment rate went up 1/10th of 1%! Wow! You did miss something. That indicates that several thousand people have re-entered the job market as it continues to steadily improve and are being counted again in the jobs numbers. This has happened every time the U.S. economy has come out of a recession since these records have been kept.
As I said in another post, it is amazing that all you left wingers and your left winged savior, Kerry, refuse to recognize the steadily improving statistics which we all use as the commonly accepted indicators of the state of the U.S. economy when they prove that your arguments that the economy is getting worse or that it is still bad at all are lies. However, you were more than perfectly happy to use the same statistics over the last couple of years to make your attacks on President Bush over the economy. Now that all of those same statistics are painting the picture that the U.S. economy is rapidly improving, you are falling all over yourselves trying to find any shred of negativity to use against President Bush. It's funny to watch.
How does it feel to be in a situation where the only way you have realized you can win the debate on the economy is to hope and pray for it to collapse. Deep down inside you hate President Bush so much you would rather have the economy reverse course so that you will have a real issue to use in the debate leading up to the election. How far do you go with your hatred of President Bush? Would you silently be happy if your fellow Americans who are or were unfortunate enough to lose their job, many of whom are very happy to receive good economic news, were not being given new hope by these good economic numbers and therefore entering the job market again? I think you all would love to have the misery and negativity of these people to use against Bush. I think some of you might even go as far as hoping for us to be attacked again so the ecomony would take another heavy blow, a fact which many of you left wingers refuse to acknowledge as a major factor in the state of this country's economy over the last couple of years.
You're welcome to your political opinion, but please leave the personal attacks and opinions on my morality, lifestyle etc out of it. You have no basis for your statements.
Hatred of GW Bush? How dare you. I hate what he's done to my country. I hate what he's done to the middle east. I hate his friends and cronies raping the economy of this country along with the environment. I hate their moralizing and grandstanding from their 'moral high ground'. I hate their bigotry and yes, their hatred for those different from them.
I do not hate them. That's a solidly Republican, conservative value.
Not hard to find flaws with Bush - I generally don't agree with Republicans but had more respect for his father as a man and as a president.
What really angers me about Jr. is his seemingly unlimited propensity for bull shit. Not only was the manner in which he was ``elected'' shady but it was not hard to see the invasion of Iraq coming as soon as he possibly could.
I am concerned with the economy, but more important to me is that war mongers are no longer the powers that be.
Your remarks on the Spanish people are typicaly Republican. What government they elect is not up to you - but of course you would impose your will if you could (such is the general nature of Republicans).
In Czarist Russia, I would be required only to obey and to believe in the Czar. There I would be a peasant. However, in the US, at least during an election year, I'm supposed to honestly consider my leaders' and government's merits/demerits, and critically consider the direction of US policy. This is not unfaithful. It's called being a citizen.
So, you're not familiar with this notion? I'm not a spectator, cheering my team from the stands, providing only moral support. In our Republic, I'm a player. You're supposed to be a player, too, but you've limited yourself to cheerleading, or rather, peasantry. A shameful thing to do in a democratic Republic such as ours, especially when you wonder why everyone can't be a happy peasant like you.
My hope and prayer is not for the economy to collapse. Quite the opposite. I want to avoid it by removing Nicholas II/George W. Bush from office as soon as possible. If Czarist Russia had been able to do the same to its hapless leader, not only would the 20th Century have possibly been a less woeful time, at least at the beginning, but the Romanov's probably wouldn't be extinct as they are today.
Now, if I'm successful, and avoid a collapse, I sacrifice the opportunity to be proven right, you follow?
I don't hate W. in anything but his political decisions. I hope he goes back to something more his speed, like owning the Texas Rangers baseball team. I even hope he brings them to the World Series. Czar Nicholas would have had a harder career adjustment.
/Zin
Finally I agree. Making a comparison between the President and a Czar is SO right on! I beg of you, please vote! Everyone vote!
Rep or Dem, there hasnt been a President that hasn't been full of shit! Nor one that hasn't been a power hungry egomaniac! Many have had strong convictions, but often they were out of touch with the total population. It seems impossible not to have these conditions.
Wait! I think they call that human nature? I'm not sure? What do you think?
The economy is run by big business, not the president. Big business runs our politicians and their policy, not us. We are a republic not a democracy. And Finally, marketing runs our opinions. So tell me, what choice do you really have?
I love these impassioned pleas for one party or another!
Ain't politics grand?!
Yes, I agree. But you have left out the power of the Church who run so much of the population who in turn influence Big Business. It is a vicious circle.
I don't believe there will ever be a ``presidential'' president - it is the nature of the beast. Those that are qualified are not interested (why would they sacrifice their integrity which would be so much of who they are).
I have always thought of Organized Religion as a VERY big business, but it is very worth making the distinction.
Actually, there is a very simple explanation. What it means is that more workers have also entered the labor force -- either totally new workers who have just started looking for work, or discouraged workers who had left the labor force some time ago deciding to get back in now that the economy is picking up.
Both numbers are important, relevant indicators of the health of the labor economy -- and both will be used by ideologues to "prove" their own partisan point of view. The abuses that political hacks make of the data positively sicken me.
The lack of job creation is staggering and well outside the bounds of my expectations. I don't see the Fed raising rates anytime soon, this will cause more money to source the carried interest rate spread trade with higher yielding foreign sovereign bonds. I would magine the UK/$, A$/$ and Euro/$ trade will become en vogue as we speak. The Japan Scenario of stagnant growth and evaporating yields could be the road map.
The only problem is we have a crappy currency, massive deficits and an abysmal savings rate so we, as Americans, rely on foreigners to fund an uncomfortable and perhaps unsustainable amount of the Treasury funding. It is true that Bush is a moron, but the lack of jobs creation has nothing to do with the guy, if a $600BB deficit can't get economy going on the jobs side yyou have to wonder what can.
-- Modified on 4/4/2004 5:42:00 PM
Many of the same arguments were made in the early 1990's as job growth, by definition a "lagging indicator," before the economy grew so strongly it created millions of jobs too many. There was not enough demand for the capacity to produce that was developed by the end of the 1990's. That is a scenario that takes place in a cyclical economy every time in that part of the cycle. Only at the end of the 1990's, the internet bubble, the y2k scare, and other similar events made it more severe than in the past. It is only natural that after the bubble burst and the economy shed capacity to meet lower demand during the recession that it take a while to regroup and have any need for new capacity that is necessary for job growth. Also huge variables in the strength of the recovery were 9/11 and corporate scandals; variables most of this board are choosing to leave out due to their partisanship. Now, over the last 6 months there has been steady growth in jobs that has now even surpassed the level needed just to absorb new workers, a fact that is also being ignored on this board. Many of your arguments were true about the state of the economy but are not valid with the addition of recent economic data and they lack context in that they don't take into account 9/11, the war, and other variables.
1st of all, the numbers are cooked, with many of the new "Manufacturing" jobs actually lower paying jobs that have been re-classified under Bush, so as to make the numbers not look so bad. Secondly, the 300K new jobs have still not kept pace with the number of new workers in the labor force, so unemployment is actually STILL RISING. And 3rd, employment growth has NEVER previously lagged this far in a post-downturn recovery. This is an entirely new phenomena of a jobless recovery which, can very likely be pegged partly to Bush's Tax policy, and partly to structural changes in the economy which Bush has no program to address. The 3 Million Job Loss under Bush is real. It is true that it is worse than before, because job growth was so strong under Clinton, but that does not excuse Bush for not having any program to address it.
You seem to really dislike the technology craze that happened and then deflated twice as fast.
I do not believe that there could ever be too many jobs anywhere. There was still unemployment but at a different level. I run a small business and we still get calls daily from people looking for work and emails and resumes in regular mail. If the economy is getting better I would like to know why I am still not generating new sales so that I would be able to hire back the workers that I had to let go in late 2002.
Never mind ctd, I know, I created too many jobs and the people that are calling looking for work are a figment of my imagination.
will have rethought these numbers by tomorrow.
Let's get to the bottom of these employment lies if we can.
http://www.bls.gov/news.release/pdf/empsit.pdf
Let's start with total employment stats on page 7 ....
Table A-1. Employment status of the civilian population by sex and age
Employed ...... unadjusted 137,384 137,691
Employed ........ adjusted 138,301 138,298
Unadjusted we gained 307,00 jobs February to March so they say. From the same line adjusted we see that we lost 3,000 jobs!
WTF?
They use the higher of unadjusted or adjusted whatever suits their purpose? What a crock of BS. But let'd dig deeper.
From the same table
Unemployment rate ...... 5.6 5.7
Unemployment went up
Now Check out table A-5 on page 10 ....
This is fun
Table A-5. Employed persons by class of worker and part-time status
Part time for economic reasons ..... adjusted 4,437 4,733
Part time for economic reasons ... unadjusted 4,764 4,868
People working part time for economic reasons skyrocketed by over 296,000 Jobs between February and March seasonally adjusted, and over 104,000 unadjusted..
Table A-8 on page 13 is interesting as well.
Table A-8. Unemployed persons by reason for unemployment
Job losers and persons who completed temporary jobs
seasonally adjusted ...... 4,323 4,607
unadjusted ............... 4,888 4,920
So we created 307,000 jobs and unemployment went up by 284,000 seasonally adjusted and 32,000 unadjusted
Lets look at newly unemployed, also on page 13
Table A-9. Unemployed persons by duration of unemployment
Less than 5 weeks seasonally adjusted .......2,468 2,589
Less than 5 weeks unadjusted ................2,318 2,413
Newly unemployed went up by 121,000 adjusted
Newly unemployed went up by 95,000 unadjusted
Let's look at total non-farm payrolls on page 16
Note that these are all PRELIMINARY numbers
Table B-1. Employees on nonfarm payrolls by industry sector and selected industry detail
Total nonfarm ..... preliminary unadjusted 128,794 129,801
Total nonfarm ....... preliminary adjusted 130,240 130,548
WTF???
UNADJUSTED we gained 100,700 jobs
ADJUSTED we supposedly gained 308,000 jobs
How can this possibly jive with Table A-1?
Let's look at Average Hours worked on page 19
Table B-2. Average weekly hours of production or nonsupervisory workers on private nonfarm payrolls by industry sector and selected industry detail
Total private ..... unadjusted 33.8 33.5
Total private ....... adjusted 33.8 33.7
Average work week declined by .3 unadjusted and .1 adjusted
On to a big key as to whether or not the FED can hike...
Average hourly wages on page 20
Table B-3. Average hourly and weekly earnings of production or nonsupervisory workers on private nonfarm payrolls by industry sector and selected industry detail
Total private weekly wages adjusted ..... $527.28 $520.93
Total private weekly wages unadjusted ... $524.58 $523.70
Thus the average worker is taking home $6.35 less per week adjusted and $.88 less per week unadjusted. Certainly no wage inflation for sure.
Well, you were right - not! The bond market did think further about the employment report, and it declined even more, because it fears (rightly or wrongly) an accelerating economy.
Now, about your "analysis" of the #'s. What you don't seem to understand is that the 308,000 gain in employment came from the ESTABLISHMENT survey, which simply adds up those on nonfarm payrolls. Since it only concerns itself with those working, something else is needed to find out about those not working, i.e., those unemployed. For this they have the HOUSEHOLD survey, which divvies up the workforce between those employed and unemployed. Hence, there are TWO measures of EMPLOYMENT, the more popular nonfarm payroll number, and the employment measure from the household survey. This concept alone should alleviate some of your confusion. Seasonal adjustments are made, of course, because there are seasonal patterns to the labor market, just as there are seasonal patterns to a host of other things, most notably the weather in northern climes. I could go on and on, but I'm not here to teach you an advanced course in economic statistics, which I could clearly do, BTW. But you were right about one thing - there is little wage inflation at the moment. As labor costs are roughly 70% of inflation, overall inflation will remain reasonably subdued until labor costs start rising noticeably, at which point the Federal Reserve will really be applying the breaks.
Where I went to school we have a saying, "Those who can, do. Those that can't, teach.
Next time I wanna know what happened I'll read the paper, or one of your posts.
BTW, I'm sure in your class you teach how markets react to a variety in inputs, not just this weak job report in which the author (not me) pointed out WEAK WAGES. Things like inflation at the producer level????????
Whatever, I'm short the LB since Wednesday so it's good to wrong sometimes...........
xoxo
http://139.142.147.22/GifChartEngine.dll?interval_day=6&cus=&securityType=3&indexSymbol=TYO30&symbol=ibm&country=USA&size=1&interval_min=60
-- Modified on 4/8/2004 9:38:41 PM
You should have shorted the bond right after the number. For the record, I spent more than 30 years on Wall Street dealing every day with the fixed income markets and economic statistics, and at a rather high level at that. I'm retired now, and enjoy reading some of the stuff on this board. You certainly could never get a job at a Wall Street firm as an economist!
wall street is a pit
by wednesday, the action was over. getting your clients in LATE to the party is part and parcel of WS though, ain't it.
-- Modified on 4/9/2004 6:11:45 PM
If the action was over by Wednesday, why did you wait until then to short the bond?
The best s/t gains were had by betting BEFORE the number was announced. The market reacted the way I expected it to and I bet accordingly. By betting after the number is announced as you suggested the gains were minimal.
I thought you were the teacher.
EOM
the payroll release, most of the gains were behind you. Isn't that what you said, that you shorted on the Wednesday following the release? Sure, you can make a bet on the # before its release - that's done all the time - but your risk increases greatly when you do that. By immediately jumping in after the release, you miss the first trade, but there's still a lot of money to be made, and the risk is considerably less. I would suggest you check the movements in the bond on the Friday the # was released, and you'll be able to see what I'm talking about.
So, exactly when did you short the bond? In your post on Aril 8, a Thursday, you said you shorted the bond on Wednesday. Now you're trying to suggest to me you did it before the # was released on April 2. A little confused, aren't you? Judging from your posts, I'm not surprised. Not only would you make a lousy economist, but you'd be a terrible trader. I don't know where you're located, but it sure as hell ain't on Wall Street! But keep on posting - you're providing entertainment for a few of us here in New York.
you can't read. it's not my fault.
of your contradictory posts.
On April 8, 6 days after the release of the payroll #, at 9:29:25PM, you wrote "I'm short the LB since Wednesday, so it's good to be wrong sometimes."
What were you wrong about?
Then on April 10, at 8:41:16PM you wrote "the best s/t gains were had by betting BEFORE the # was announced. The market reacted THE WAY I EXPECTED IT TO and I bet accordingly."
If the market reacted the way you expected it to, I again ask what you were wrong about on April 8. Could it be that you shorted (if in fact you did any of this at all) on April 7 and missed most of the move?
The next payroll # is released on May 7. I would now expect you to tell the entire board what action to take BEFORE the number is released, and to continue doing so as the year progresses. This way we can all take advantage of your astute market knowledge. Hey, you have a 50% change of being right each time!
Then on April 10, at 8:41:16PM you wrote "the best s/t gains were had by betting BEFORE the # was announced. The market reacted THE WAY I EXPECTED IT TO and I bet accordingly."
.....................................................
In my post on the 8th, my reference to Wednesday was Wednesday the 31st, THE WEDNESDAY BEFORE THE NUMBER WAS RELEASED WHICH IS CONSISTENT WITH THE ABOVE POST!!!!!!!!!!!!!!
How was I supposed to know THEN I was going to have to indentify THE PRECISE WEDNESDAY????
What's your point in all this anyways? I tried to offer some more detail to the jobs report to someone who asked and I offered an opinion as to how I thought the bond market would react after what I thought was a harsh reaction, so what? I did'nt attack you as you attacked me. Why did you feel it necessary to attack me out of the blue?
I suspect it has to do with arrogance. How dare anyone opine on economic matters when King Smartshit is here, right? ARE you as intolerant in all other matters as well? Again I suspect so.
Why don't you go peddle some PCLN to Grandma. Wall Street schmuck.
FO
-- Modified on 4/12/2004 6:53:47 PM
the explanation. Now you're pissed and bitter because you were caught in a contradiction of your own making, and you still haven't told us why you were wrong. If you shorted BEFORE the number, HOW WERE YOU WRONG? Unless, of course, you shorted after the number. Quite frankly, I doubt that you shorted the bond at all!
You're "explanation" of the labor market statistics was totally convoluted, and I would have to write a tome to explain to you why. And it wouldn't be worth it, because you'd never be able to understand it! Like I said, I tried to explain to you the major piece of confusion, and you went berserk. Guess you can't deal with Wall Street guys, huh? Let me tell you something. Most guys I know on Wall Street who make big bucks have forgotten more in the last 10 seconds than you will ever know in your ENTIRE LIFE.
OK, I can see you're not going to tell me why you were wrong fot "shorting the bond BEFORE the #," obviously because you can't. You think I'm a "Wall Street schmuck" - and I think that you're just some dumb fuck. Are we even, or do you want to continue this? If you want to continue, that's fine by me. I'll just ask you before all the payroll #'s what your forecast is, and reference these posts in this thread so that everyone can see how good your bond positioning is.
But for now I'm going to Vegas for a couple of days, but I'll be sure to check this board when I come back. If you persist in your name-calling, trust me, I will respond, and we can make this the longest thread ever. For what it's worth, I wasn't trying to put you down in my original post. I was simply trying to explain something about the employment statistics. It's a subject I know very well, having dealt with these #'s for more than 30 years. But you took offense at being corrected. Well, I can't help that, but I would think you'd be used to it by now. I gotta be honest - you're the type of guy that Wall Street likes to feast on. And while you may not believe this, I can honestly say that I never took advantage of clients that didn't have a complete understanding of this stuff, and that's something that I'm proud of. The ball's in your court now - we can prolong this, or we can drop it. Up to you.
all of this smacked of sass and arrorgance. On that score you have not disappointed.
I have nothing to prove to you or anyone else. I could be lying about what I did and you could be lying about yourself as well. Who cares? But to clear things up in your mind, I shorted before the number but was wrong in how the market reacted afterwards, hence, "I was wrong". I don't give a rat's ass whether you believe me or not. ONe other thing, I told you early on that the analysis was someone else's not mine. If you had an ounce of manners I would have been delighted to discuss with you how you saw it differently than I.
You're right about one thing, you probably do know far more about economics than I do, that's not my vocation. But you could never teach me anything about it because I don't listen to arrogant, condescending blabbermouths. There are others who know far more than you who are'nt assholes.
Finally, I don't care if you decide to prolong this or not, I'm done with you and I'll not be responding not matter what you decide.
Have fun in Vegas, or Toledo, whereever you're going.
and I used to think it was just in jest, but you're proving that there's an element of truth to it. LA is the land of 72. It's both the average temperature and the average IQ.
But you are right about one thing at least, and that's that I know far more about economics than you do. However, the reason I can't teach you anything about it has nothing whatsoever to do with me, but rather you're attitude about learning something about it (I'm trying very hard to be polite about this). Like you said, you don't listen, and while you think I'm condescending and arrogant, at least I'm not a dummy!
OK, bub, let's see if you don't respond. The betting here is that you do, but if you don't, the matter is closed.
BTW, I will (hopefully) have fun in Vegas. The last time I was in Toledo was in 1961 at a rather famous whorehouse called "Round The Clock." It was my freshman year in college, and it brings a smile to my face just thinking about those good times. Something tells me that you've never been in Toledo, and believe me, you're not missing much. But back then it had a raunchy nightlife that was actually a lot of fun, and it was worth the road trip every once in a while on Friday nights. Hell, I was a New York kid, and nobody was the wiser.