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"Buy A Gun" Google Queries Hit All Time High, And Other Off The Grid Economic Indicators

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In lieu of a credible macroeconomic data reporting infrastructure in America, increasingly more people are forced to resort to secondary trend indicators, most of which have zero economic "credibility" within the mainstream, yet which provide just as good a perspective of what may be happening behind the scenes in this once great country. A good example was a recent Gallup poll, which contrary to all expectations based on a now completley irrelvant and thoroughly discredited ADP number, which led some br(j)okers such as the Barclays Insane Predictions Team to speculate a 580,000 NFP number was in the books, indicated that the jobless situation barely improved in December. Sure enough, this was promptly confirmed by the January 7 NFP number. And so, in looking for a variety of other "off the grid" economic indicators we read a recent report by Nicholas Colas, which proves to us that we are not the only 'nerdy' entity out there increasingly searching for metrics that have some rooting in reality, and not in the FASB-BLS-Census Bureau joint ventured never-never land. And while we recreate the key points from the report, the one item that should be highlighted is that, as we have suspected for a while, the social undertow of fear, skepticism and anger is coming to a boil, as Google queries of the "Buy A Gun" search querry have just hit an all time high. How much of this is due to the recent events from Tucson, AZ is unclear. What is clear is that the trend is most certainly not your friend (unless you are of course the CEO of Smith and Wesson).

We'll leave the interpretation of this chart to our very erudite politicians.

As for other must read observations on the topic of derivative economic indicators, we present Nicholas Colas' must read latest: "Off The Grid” Economic Indicators – Q410 Edition

There are a lot of economic indicators out there, and we pay attention to all of them because government decision makers have told us they shape economic policy. But there’s a wealth of independently developed economic and statistical data available as well, and much of it provides much-needed color on the real state of the U.S. economy. Our collection of anecdotal datapoints, which we have dubbed the “Off The Grid” indicators, paint a more nuanced picture of a slow growth U.S. economy that is still struggling with the aftermath of the Financial Crisis. Bullish points include demand for pickup trucks, used cars and an increasing number of people who leave their jobs voluntarily instead of through layoff. Bearish points are headlined by still-rising food stamp participation, with gun sales and rampant buying of silver coins underpinning continued popular concerns over personal security and the soundness of the dollar. Food inflation also features on this list. Neutral points: mutual fund inflows (but potentially turning positive) and Gallup poll consumer spending.

Ever wonder where the word “Nerd” came from? It’s a “nerdy” question, to be sure, but apparently it comes from a Dr. Seuss book entitled “If I Ran the Zoo.” I don’t remember the appearance of the word from my early exposure to the work, but I certainly remember the opening:

“If I ran the zoo,”
Said young Gerald McGrew
“I’d make a few changes,
That’s just what I’d do.”

That’s pretty much the way I feel about the current state of economic indicators that we all pick apart, analyze, and try to cajole into some form of investable signal every day. We look at them because the Federal Reserve looks at them. And the Treasury. And the White House. And every other seat of economic power. But in reality they look at them because these datasets have been around long enough that someone, somewhere, has done a doctoral dissertation or other academic treatise validating their relevance.

In the world of automated and computerized payrolls, for example, the Bureau of Labor Statistics still uses a telephone survey of a few thousand households to decide if employment is rising or falling. OK, this used to be a hard issue to tackle in the 1950s and 1960s. But the U.S. Treasury’s Internal Revenue Service tracks everyone’s contributions for payroll and tax withholding in real time now. If someone stops getting their paycheck, Treasury knows about it by the time of their next pay cycle. They can identify where the person works based on their zip code. The employment picture should be clear as day using this data. It used to be hard when paychecks doubled as computer punchcards (my Dad had those in the 1970s). The telephone survey approach is like using a horse and buggy to get around when there are the keys to a perfectly good Ferrari in your pocket.

All good natured ranting aside, there’s no excuse for not casting a wider net when it comes to the never-ending search for useful economic data. And you don’t need to be a “nerd” (there’s that word again) to get it – we aren’t talking about advanced language algorithms working against a Twitter API feed. The data is out there and thanks to the Internet it is pretty easy to track. That’s the reason we have developed our “Off the Grid” economic indicators – our “eyes” into the real U.S.  economy. And those “eyes,” we hope, are truly the windows into the soul of some form of lasting recovery.

Our take away from this quarter’s indicators is that the recovery in the U.S. economy is slow and unevenly distributed, with several long-tailed effects that may take decades to fully understand.

  • The bad news – and there’s still plenty of it – is that the Financial Crisis pushed millions of Americans into government assistance programs such as Food Stamps, dampened their confidence in the currency, and made them feel much less secure about their personal safety.
  • The good news – and there is more now than at any point in the year we’ve been looking at the data – is that more people are feeling better about the labor markets, buying big ticket items, and perhaps even investing in U.S. stocks again.
  • The wild card – and it is a big one – is food inflation. We’re back to where we were at the peak of the prior cycle in 2007, but with an economy that is nowhere near as strong.

The data, in short, supports the mainstream economic viewpoint that the U.S. economy is improving at a slow pace. The nuances that it highlights, however, are that the damage from the recent recession is as much cultural as economic. A consumer base – even one at the lower end of the economic ladder – with fundamental concerns over food security and affordability or personal safety is not the “dry tinder” of a strong economic bounce back. I don’t know whether to call that  “New Normal,” “Old Abnormal” or whatever other rubric might fit this paradigm. But it is a picture of the landscape that you don’t see as much in the government-approved economic indicators, and it tells a separate and perhaps more accurate truth.

The various indicators that inform this view are all included in the attachments to this note , and we’ll touch on a few of the important ones here:

Food Stamps – This program, originally created to sell surplus produce to starving Americans in the Depression, has morphed over the decades into a foodpurchase grant to low income households. The growth rates for SNAP (the modern name for Food Stamps – Supplemental Nutrition Assistance Program) have been stratospheric for the last two years at +15% year-on-year growth. Part of this was a change to eligibility requirements in 2009, but a lot more was the impact on the recession among low income households. The program now helps over 43 million Americans feed themselves, about 14% of the U.S. population.

The good news, if one can call it that, is that the growth rates are slowing. Last month one of our one strategy team members went to several public assistance offices outside New York to speak to people waiting for a consultation and those interviews shed some light on this trend. The bottom line is that such facilities were simply overwhelmed over the past two years. People who qualified for public assistance needed to visit such centers several times, as the paperwork needed to complete the application process is lengthy and convoluted. So growth rates rose steadily as these individuals finally cleared the hurdles required to receive benefits. One other data point that supports that the growth in the SNAP program may have peaked: Google searches for the term “Food Stamps” are no higher than mid-year 2010.

The deeper question is what the widespread adoption of SNAP will do to the society over the coming years. This is actually not a budget discussion – SNAP is very efficient and costs less than $100 billion a year to help +40 million Americans. Rather, it is a question of the effects of long term reliance on government support to economic issues such as labor participation rates and employment levels. We are in uncharted waters here, to be sure.

Durable Goods Purchases – The most upbeat news from our indicators is the degree to which consumers are snapping up used cars and pickups. Yes, the economic data focuses on all light vehicles, but the “Off the Grid” indicators dance to a different drummer. Used car prices are a great leading indicator for new car and truck demand, and the Manheim Auto Auction data keeps hitting new highs. Pickup trucks are work vehicles, primarily purchased by small businesses. After a steep selloff from the bursting of the housing bubble, pickup truck demand is now positive again, to the tune of +20% year on year for several months in a row.

Guns, Ammunition, and Silver Coins – Whether you are “pro-“ or “anti-“ gun, the sale of firearms should be on your radar screen as a heuristic measurement of something I will call “consumer security.” There is a baseline of organic firearm demand in the U.S. – for years it was about 8 million units, as measured by the FBI’s instant background check request data. With the 2008 recession that number spiked to first 10 million and now 14 million background checks a year. At first observers chalked that up to a Democratic President, but it has been years since Obama’s inauguration and the numbers keep climbing. I  attribute that to a deeper sense of unease in the population – perhaps about government controls, perhaps about crime. Hard  to say how much of each. But it is easy to say that an unsure society is not one ready to resume a carefree spending profile. And keep in mind that guns are not cheap – a basic rifle or shotgun will run $300 or more.

Much of the same point applies to the recent surge in demand for silver coins. From a monthly sales run rate of less than 1 million coins, the U.S. Mint now pushes out close to 3 million coins a month, and dealers would clearly like to have more. As with guns, silver coins are not cheap - +$30/piece, or +$600 for a roll of 20. I suspect much of this demand stems from gold’s steady price move higher and the fact that the Mint is not producing as many fractional ounce gold coins as it once did. That means people with less than $1,400 to spend on precious metals coins migrate to silver. That is born out in the decline in Google searches for “Gold Coins” as prices there spiked in 2010. Bottom line – there is a fundamental lack of confidence among enough people in the population as to the long term soundness of the dollar.

We’ll close out on a few positive points and one real problem.

  • Workers are quitting more often now, according to the underappreciated but highly useful BLS JOLTS data. Almost half of all separations from an employer are now the employee’s idea, rather than a layoff. That dovetails with the recent rise in consumer confidence, as the attached chart highlights.
  • Mutual fund flows into U.S. stock funds had a positive week, ending 1/12/11. It has been a long dry spell here – ever since May 2010 – so perhaps investors are finally reengaging with domestic equities as they start contributing to 401(k)s in the New Year.
  • Food inflation could be a very large, very nasty problem. The Dept of Agriculture’s “Prices Received” data shows that “All Farm” prices are back to where they were in 2007.

And all the non-government originating charts that's fit to print:

Manheim Used Vehicle Value Index and Equity Mutual Fund Flows:

Food stamp participation and gold coin sales

Silver coin sales, Prices Received, and NCIS Background Checks

Pickup truck sales and Consumer confidence

Google Queries: "Buy a Gun", "Buy Ammunition", "Food Stamps", "Gold Coins", Gallup consumer spending.

 

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Mon, 01/24/2011 - 01:09 | 898145 topcallingtroll
topcallingtroll's picture

While well written and not bad advice i prefer an 18 inch barrel on a 12 gauge pump but a semiauto well maintained is also appropriate. The problem with shotguns for home defense is the maneuverability issue in close quarters. A 24 inch double barrel is fine in experienced hands. Still i prefer higher shell capacity. A pistol grip instead of standard stock increases maneuverability and even a 20 gauge is just fine, especially for beginners but even i would be perfectly confident gacing a home invasion with a 20 gauge pump. I believe handguns are better but anything you are good at is likely to be adequate. A glock semi auto has never failed me once. However i also like revolvers and for a great pocket gun the s and w 340 hammerless is excellent. You can shoot it from inside your coat pocket without drawing and under the sheets and it wont jam by cloth interference with semi auto case ejection. I have no problems with.shotguns but the average casual.shooter out to use a pistol or revolver and glaser safety ammo if they worry about overpenetration through walls.

Mon, 01/24/2011 - 01:34 | 898160 Aristarchan
Aristarchan's picture

Yeah, your points are well taken. I shot quail for years with my Fox, so it is like an extension of my arm. And, I worry about nervous neophyte shooters hitting a target in a violent, nerve-wracking situation with a handgun. A pump is good...I hate autos, since they are not always reliable. I used a shotgun in Vietnam, and used a double, since dirt and crap did not foul it like a pump or an auto, and I learned instinctively to hold two extra shells in my left hand...so maybe I am projecting experience when I should not be. But, be wary of complexity. I should also point out that I also carried an M-16, but did not hold it as my primary weapon.....I trusted the shotgun more for the close encounters we would likely have. Now, In those circumstances, I used double buck, since invariably, I would have to shoot through bush....not the same as a home environment. One option is a drilling. I have a 20 gauge/.243 over-and-under, but I still worry about penetration and collateral damage issues.

Mon, 01/24/2011 - 02:05 | 898174 topcallingtroll
topcallingtroll's picture

I worry that it might be a little harder to get to your shotgun quickly while relaxing in your home or in bed. Ladies might be intimidated by a shotgun and shy away from practicing enough to become proficient. A revolver is a good.compromise in such situations. A double barrel is a good idea to learn fire control and shot discipline. Probably we will all be reduced to double barrels eventually. I should practice more. I really loved how well the.browning shot.out.dove.hunting one time, but i was all thumbs on the reloads!

Mon, 01/24/2011 - 00:41 | 898125 Fred123
Fred123's picture

Soon the most searched for item will be "Impeach Obama".

Mon, 01/24/2011 - 01:36 | 898163 JW n FL
JW n FL's picture

http://www.google.com/trends?q=impeach+obama

now shut the fuck up stupid.

Mon, 01/24/2011 - 03:06 | 898207 mouser98
mouser98's picture

unnecessary dude

Mon, 01/24/2011 - 09:41 | 898403 JW n FL
JW n FL's picture

are you voting in the next Presidential Election? really? nooo you are not.

and whats the republican theme? change you can believe in?

tea party?

dems?

all the same.

or... paid by the same lobby... so no change.

Mon, 01/24/2011 - 00:58 | 898136 Aristarchan
Aristarchan's picture

Somebody earlier said that owning a gun is only one aspect of personal security, and, he/she was right. It is hard for me to imagine somebody not being intimately familiar with guns, since my grandfather bought me a .22 rifle when I was just a little fuck, and I hunted for years for food and pleasure, was paid by Uncle Sam to Hunt in SE Asia, and once shot a kinfolk (by marriage) of mine. But, I realize that not everyone was born in Texas or has killed people as a member of the military. Become familiar with your gun. A gun is not a toy....it is a responsibility. If you have kids, be very careful. My kids are grown, and grew up around guns, and never touched one of mine when they were young.

Training is a good thing, but it does not prepare you to kill someone. I am not sure anything does, except doing it, and I do not recommend that.

 

Mon, 01/24/2011 - 01:21 | 898151 topcallingtroll
topcallingtroll's picture

Agreed. Good home security with a steel door and reinforced frames plus using common sense when entering and leaving your premises is probably more important than an armory in your house. Sticker.bushes at the windows, a dog, an alarm system and even a safe room to sleep in are also great ideas. Guns are not necessary but i like them! I know you say it is hard to shoot somebody but if someone is endangering my family and other options are unsafe including retreat then i would be overjoyed to see the threat lying in a pool of blood. How can attempting to kill someone who is seriously endangering your family be hard? Its just one last piece of trash taking up valuable oxygen.

Mon, 01/24/2011 - 01:38 | 898166 Aristarchan
Aristarchan's picture

Well, a lot of people find killing someone very difficult to do. I knew guys in Vietnam who never even fired their weapons, or if they did, fired them high. I understand what you mean by protecting your family, and I hope everyone is capable of doing that if they are unfortunate enough to face that issue. My worry is the syndrom a lot of people have that to point a weapons at a threat is to automatically defuse that threat. That frame of mind will get you killed.

Mon, 01/24/2011 - 01:53 | 898169 topcallingtroll
topcallingtroll's picture

Yes pointing a gun does nothing and if they are less than ten feet away they might disarm a novice before he can fire a shot. I would have had a hard time shooting gooks too and.dont.think i could have done it. What did the gooks.do to deserve.it? Try to drive out the french and other perceived western aggressors? They certainly werent invading my home and putting my.children.at risk. I fully.understand the qualms about gook.shooting, but a.low life scumbag invading my home is an entirely.different matter.

Mon, 01/24/2011 - 01:59 | 898171 Aristarchan
Aristarchan's picture

Not really, since shooting was the only way these poor fools could save their own lives. Politics - in the jungle - had nothing to do with anything. There were no "gooks," only people trying to kill you.

Mon, 01/24/2011 - 02:09 | 898177 topcallingtroll
topcallingtroll's picture

Yeah i guess i would shoot also under.those circumstances. But i would have felt awfully.guilty later probably. Fortunately i will likely never face the situation.

Mon, 01/24/2011 - 02:20 | 898183 Aristarchan
Aristarchan's picture

Yeah. A lot of guys came away from there feeling guilty. I was not one of them. I hated my country for a long time for drafting me and putting me in that situation, but I never felt guilty for defending myself. At first, that was what I was doing. later, it became my job. If I feel guilty about anything, it was how I co-opted my own morals to make what first mortified me, into something I actually later, enjoyed. We all, I guess, use mental tricks to make our situation survivable, both mentally and physically. To me, I figured out the best way to survive, and that was to kill those first who had designs to kill me. I really had no choice. It would not have mattered to me if they were gooks, Russians or supermodels....For me to live, they had to die. A weird frame of mind, I guess, but probably suitable for the time and the situation.

Mon, 01/24/2011 - 03:02 | 898203 mouser98
mouser98's picture

you don't need to feel guilty, you were basically put there at gunpoint and ordered to shoot at the other guy that was put their at gunpoint.  the guilt lies on those in the political and corporate world who felt they would benefit by putting you there.

Mon, 01/24/2011 - 01:23 | 898156 JR
JR's picture

The More Americans That Go on Food Stamps the More Money JP Morgan Makes

“JP Morgan is the largest processor of food stamp benefits in the United States. JP Morgan has contracted to provide food stamp debit cards in 26 U.S. states and the District of Columbia. JP Morgan is paid for each case that it handles, so that means that the more Americans that go on food stamps, the more profits JP Morgan makes. Yes, you read that correctly. When the number of Americans on food stamps goes up, JP Morgan makes more money. In the video posted below, JP Morgan executive Christopher Paton admits that this is "a very important business to JP Morgan" and that it is doing very well. Considering the fact that the number of Americans on food stamps has exploded from 26 million in 2007 to 43 million today, one can only imagine how much JP Morgan's profits in this area have soared. But doesn't this give JP Morgan an incentive to keep the number of Americans enrolled in the food stamp program as high as possible?…

“So if unemployment goes down will this ruin JP Morgan's food stamp business?…”

http://www.lewrockwell.com/rep2/more-americans-on-food-stamps.html

Mon, 01/24/2011 - 01:58 | 898170 indio007
indio007's picture

Forget firearms. Most people that die in combat don't die from bullets.  Get the Improvised munitions handbook then stake your ground ;)

Mon, 01/24/2011 - 02:03 | 898172 Aristarchan
Aristarchan's picture

I have all those books and know how to create situations to make you die before you get close to me, and have done so in practice. But, most of them are highly illegal in a civilian environment. But.....not all.

Mon, 01/24/2011 - 02:26 | 898185 topcallingtroll
topcallingtroll's picture

Aahh. A fellow paranoid. Welcome to the.club! I sure hope i never have to.go up against you. If you went batshit crazy you would be truly formidable. My only advantage might be the custome.circuit breaker in my home and gen 3 nightvision and barricade myself and.hope for the best. A guy like you would have on body armor and i wouldnt ecpect that so i would probably.lose anyway even with.a 357 sig glock. Im going to rethink.my preference for a pistol because a shotgun would be the best chance to stop.a guy.as ecperienced.and.armored up.as.you might be. Fortunately home invaders of.your quality are rare.

Mon, 01/24/2011 - 02:54 | 898194 arnoldsimage
arnoldsimage's picture

when society breaks down, and it's when, not if, we are going to be facing some real evil people out there. the number of gangs in our country is huge and poses a great threat in my opinion. these individuals have no soul so get prepared mentally. here is a link that will bring light to the problem we will face. warning: very graphic. http://jungletraining.com/MS-13%20report.PDF

Mon, 01/24/2011 - 03:02 | 898197 Milton Waddams
Milton Waddams's picture

"Buy guns" is loosely correlated to "buy butter".

It appears that "buy butter" began to outperform in mid 2010. And the rest is for historians to decipher

http://www.google.com/trends/viz?q=buy+butter,+buy+guns&date=all&geo=all...

Mon, 01/24/2011 - 04:14 | 898253 alexwest
alexwest's picture

good article, but lame conclusions..

#The program now helps over 43 million Americans feed themselves, about 14% of the U.S. population.

its bad analysis... chilren are not eligible to receive.. this +43 figure only relevant who's eligible...

ITS MUCH WORSE,,

US 'Civilian noninstitutional populatio' is +238 mln (excl military, criminals in jail , etc), so ratio 43/238 is almost 20%...

acorrding latest labor report there were 108+ mln private jobs,, so
for each 2 working adults existed 1 non working/shitty job working adult..
so real UNDER/UNEMPLOYMENT RATE IS CLOSER TO 30%...

thats worse then in GREAT DEPRESSION..
alx

Mon, 01/24/2011 - 05:10 | 898285 DukkButt
DukkButt's picture

Ruger has an interesting new rifle, the Gunsite Scout. Bolt action .308, 16" barrel, 7 pounds weight and a 10 round magazine. Very few moving parts, so it should be reliable and long lasting. Keep it lightly oiled so it doesn't rust and it will still be functional 100 years from now.

Mon, 01/24/2011 - 09:43 | 898407 JW n FL
JW n FL's picture

FN HERSTAL S.A. Model A3G Commerative FBI Rifle

FN Herstal 308 Win. Commerative FBI Tactical Precision Rifle

Chambered in 308 Winchester, the A3 G has a 24" cold hammer forged MIL- SPEC fluted barrel with hard chromed bore and is held to +/- .001" headspace to produce and maintain a sub-1/2 MOA accuracy standard at 100 yards, making it ideal for long range target shooting and tactical competitions. The internal magazine offers a hinged floorplate for easy unloading. A one piece steel MIL-STD 1913 optical rail with an additional 20 MOA of elevations comes standard. The action is hand bedded in to an olive drab Mc Millan A3 fiberglass tactical stock that is fully adjustable for comb height and length of pull and offers multiple steel sling studs. Also includes controlled round feed, blade ejection, the original two level trigger and three position safety.

SPECIFICATIONS:
Mfg Item Num: 75544
Category: FIREARMS - TACTICAL RIFLES
Action :Bolt Action
Caliber :308 Winchester
Bbl Length :24"
Capacity :5 + 1
Trigger :Standard
Safety :Three Position
OAL :44"
Weight :14.3 lbs
Stock :A3 Fiberglass Tactical
Finish :Matte Black

UPC: 818513009676

Weight: 8.00

http://www.ableammo.com/catalog/product_info.php?products_id=112326

Mon, 01/24/2011 - 08:24 | 898329 Tenma13
Tenma13's picture

....and thanks to ZH members 'how to kill' is trending nicely. :)

http://www.google.com/trends?q=how+to+kill&ctab=0&geo=all&date=all&sort=0

 

Mon, 01/24/2011 - 12:02 | 898824 Ace Ventura
Ace Ventura's picture

Good thread, lots of valuable insight into age-old debates on the best choices for multiple scenarios. As many here know, there are no real answers that are perfectly suited for ALL situations, thus the good advice to obtain more than one weapon.

Apologies if this option has already been mentioned, but there is alot to be said for older military-surplus rifles. In many cases, these are high-powered brutes built like tanks and designed for REAL combat. For less than $800, you can acquire one of the finest ever made, the M1 Garand. One's first instinct is to scoff at these old wooden-furnitured relics....until you take one to the range, and it turns you into a believer.

Do NOT follow this link or you will be banned from the site!