It is easy to forget that when dealing with corrupt, foreign regimes, the labor structure tends to be just "slightly" different from our own. Case in point - Egypt. In today's note from Art Cashin, we read something quite fascinating, namely that while unemployment in Egypt may be very high (who knows what the real number is - we have enough problems with snowfall and reconciling the household and establishment surveys as is), a far bigger concern is that of those employed, 70% work for the government. Is there a better indication of just how pervasive the Stockhold Syndrome is. Surely, at some point Egyptians will want to go back to work. Yet they work for the government, the same government that may well be in tatters should the revolution proceed according to such a plan that ultimately ousts Mubarak. Which begs the question: was the revolt doomed from the get go, and what is the breakdown between employed and unemployed in Egypt, for the anger to get off the ground in the first place.
From Art Cashin:
Jaw-Dropping Payroll Numbers – No, not Friday’s snow excused mini-number. Rather, thanks to Bob Hardy of GeoStrat, a stunning assertion about Egypt. There is, as we know, a high level of unemployment, but Bob says, of those employed, 70% work for the government. No wonder there are reports that many people tire of the demonstrations and seek a return to “normal”.
And as a tangent, here is Cashin's market commentary from his today's note.
Egyptian Enigma Shapes Trading Yet Again – Friday’ trading almost looked like a template of the week’s previous days.
Once again, uncertain, mildly negative morning sessions. Traders watched their TV screens trying to gauge the tone in the streets of Cairo.
As crisis did not explode, mid-day brought a mid-session of indecisive lateral trading. Ultimately, as the closing bell loomed within an hour or two, those awaiting bargains began to feel pressure from the clock running out. The buyers were also pressured by rumors in the crude pits that Mubarak was about to resign. That sent oil into negative territory.
It is somewhat strange to see the same pattern and process day after day but the market seems to have a mind of its own. We’ll have to wait and see what happens as the ultimate resolution of events in Egypt becomes evident.