After several quarters of smashing expectations, moments ago Amazon tumbled as much as 9% after reporting EPS of $0.52, far below the $0.85 expected, on revenue of $32.7 billion, in line with estimates, and up 29% from a year earlier. Operating income also missed, printing at $575 million, below the $690.5 million expected.
With real wages stagnant below 1.5%, rising energy costs, soaring medical costs due to Obamacare, record high home prices and rent expense due to the Fed, the average new car price at a record $34,000, and food prices rising steadily, the standard of living of the irredeemables continues to plunge. But at least our taxes will be going up if Hillary and the establishment have sufficiently rigged the election to insure her victory. Sit back and enjoy our journey to third world status.
Who says there is no wage growth? Certainly not the Labor Department, at least when it comes to black workers. In a release on Thursday, the DOL reported that seven years after the "end" of the recession, median wages for full-time black workers jumped by 9.8% in the Q3 - the biggest quarterly jump since record began in 2000.
Following the unexpectedly hot Chinese inflation data, where PPI posted its first annual increase since March 2012, moments ago the BLS reported that like in China, US wholesale prices also rose more than the 0.2% expected, up 0.3% in September, following an unchanged print the prior month. On an annual basis, the final demand index increased 0.7% in September from a year ago, the largest 12-month rise since advancing 0.9% in December 2014.
Before President Obama takes his final victory lap with claims of creating the most robust employment recovery since the 1990’s, the data clearly suggests otherwise. Of course, if you ask the 37% that are no longer counted as part of the labor force, they will tell you the same thing.
With three dissenters and no good reason (based on their own data) to stay on hold in September, The Fed chickened out, but jawboned the hawkish tilt afterwards. With Nov odds at 19% and Dec at 66%, the USD and Treasury yields were falling dovishly into the Minutes, this is what the Fed said “Several participants expressed concern that continuing to delay an increase in the target range implied a further divergence from policy benchmarks based on the committee’s past behavior or risked eroding its credibility” especially because recent data supported the committee’s outlook, the minutes stated.
With Wall Street all bulled up on the economy, expecting a print of 175K while the whipser number was decidedly higher, and closer to 200K thanks to Goldman's optimism, moments ago the BLS reported that in September the US created only 156K jobs, missing expectations, and down from the upward revised 167K in August, leaving the question of whether the Fed will hike imminently, unanswered.
For those lucky Americans who can afford to own a house instead of being stuck renting the New Normal American dream, here is the breakdown of the top US cities with the highest and lowest home price appreciation.
Relative to disposable income, the value of household financial assets now far exceeds the last two bubble peaks. And that has happened in an economic environment which suggests just the opposite. To wit, valuation multiples and cap rates should be falling owing the fact that the productivity and growth capacity of the US economy has been heading south ever since the turn of the century. So here’s the danger...
We are speaking, of course, of the Fed’s decision to punt yet again, and for a reason that is not mysterious at all. To wit, our financial rulers are petrified of a stock market hissy fit, and will go to any length of dissimulation and double-talk to avoid triggering a crash of the very bubbles their policies have inflated.
It turns out that 52% of all the new jobs - 5.25 million - reported by the BLS since the end of the recession were imagined, not counted. This amounts to still another whopper from the government statistical mills, and more evidence that the so-called recovery is based on a tissue of lies.