The BLS put out their monthly CPI lie last week. They issued the proclamation that inflation is dead. Did you know your costs are 0.1% lower than they were one year ago. They then used these deflation numbers to proclaim your real wages soared last month. It’s all good. The American consumer is so flush with cash, they decided to spend less money for the second month in a row. The Wall Street shysters are so happy with declining consumer spending, declining corporate profits, and a global recession, they pushed the NASDAQ up to 5,000 for the first time in 15 years.
Another day, another missed data point. ADP Employment data shows 212k jobs added in February, which modestly missed expectations of 219k and is the weakest monthly gain in 6 months. This despite a strong prior revision, pushing the January number up from 213K to 250K to catch up to the BLS runrate. Despite the miss, that showed large businesses adding by far the fewest jobs, Mark Zandi as usual remains optimistic: "jobs growth is strong but slowing," and expects the economy "will return to full employment by mid-2016."
Presenting the Florida jobless claims website. According to the Miami Herald reports, on Friday, the state’s auditor general issued a scathing 45-page audit that joins mounting evidence that CONNECT - aka Florida's Online Reemployment Assistance System or said simpler, jobless claims website - is a system in disarray.
yes: the S&P may well be "fairly priced" here, if one assumes an 18x (rounded up) forward P/E multiple to be fair - a number which is above the prior 5-year average forward 12-month P/E ratio of 13.6, and above the prior 10-year average forward 12-month P/E ratio of 14.1. And in order to achieve that, not much has to happen: instead of hiring millions, America's corporations just need to fire about 2-3 million people in order to extract the kinds of net margin efficiencies that are already priced in!
"...we are failing to deliver on our obligations as Americans, that is undeniable. We are allowing the political class to plunder our wealth, negate our freedoms and desecrate our Constitution. Sadly we have become the immoral populace our founding fathers warned all future generations not to become... The duty and obligation is ours and so too then are the failures and successes of our society. We are 15 years in to what is absolute denial regarding the competence of our nation’s policymakers. Yet here we sit, silent and indifferent to our own demise; so completely antithetical to the character of a true American."
The One Number The Market Is Focused On: Real Hourly Wages Surge Most Since Lehman Deflationary ShockSubmitted by Tyler Durden on 02/26/2015 10:09 -0400
In today's deluge of macro data, one number stood out: the parallel release by the BLS of the real average hourly earnings, which is simply taking the previously reported nominal hourly wage data, and applying whatever deflator gets released in parallel by the BLS. And, not surprisingly, after the nominal jump in January wages, a number which may very well be revised lower as has been the case so often before, courtesy of the headline deflation, the real jump in hourly wages was even higher. In fact, rising to an inflation adjusted $10.55/hour from $10.42 in December, it meant real wages rose by 1.2%, which was the best jump in hourly wages since... the months following the Lehman collapse. Because everyone remembers how the deflationary vortex in the aftermath of the Lehman bankruptcy led to a sense of wealth and eagerness to spend deflation adjusted wages.
Beginning at the time of Disney World’s grand opening in 1971 when Magic Kingdom tickets cost only $3.50, Magic Kingdom ticket prices have increased at a compound annual growth rate of 8.04% – nearly double the U.S. CPI’s compound annual growth rate of 4.13%. The U.S. CPI no longer accounts for the cost of maintaining the same standard of living in America. The Magic Kingdom Price Inflation Rate provides a much more accurate view of real U.S. price inflation.
Revenue growth that has finally turned a historic corner, because while on the last day of 2014 there was still some hope that S&P500 sales will still grow even if at a very muted pace, as of Friday - for the first time since Lehman - full year revenue growth is now projected to turn negative!
The January statement had only modest changes so reading the tealeaves of the FOMC Minutes 'should' provide little additional color with the main focus on the meaning of 'patient', fears over 'international developments', the 'right' gauge of inflation, and pace of rate lift-off...
- *MANY FED OFFICIALS INCLINED TO STAY AT ZERO LONGER: MINUTES
- *MANY OFFICIALS FELT DROPPING `PATIENT' MAY LEAD TO DATE FOCUS
- *MANY FED OFFICIALS SAW RISKS IF FOREIGN WEAKNESS WORSENED
- *FED OFFICIALS AGREED POLICY SHOULD STAY DATA DEPENDENT
It appears The Fed is 'worried' again... lower for longerer. Pre-FOMC Minutes: S&P Futs 2091.25, 10Y 2.122%, Gold $1201.50, WTI $52.05
USGS Reports 6.8 Magnitude Earthquake In Russia Near Ukraine Border, Then Retracts It Blaming "Mislocation"Submitted by Tyler Durden on 02/13/2015 16:51 -0400
Something surprising happened about an hour ago: at 2:15 pm, the USGS reported that a major 6.8 Magnitude earthquake had taken place in Russian territory, 16 kilometers WNW of Klintsy, in a location that is close to the Russian border with both Belarus and Ukraine. What is curious is that some 20 minutes later, the USGS decided that no quake had actually taken place. In fact not only was the earthquake promptly scrubbed from the USGS website but the link we had sent out as notification of the earthquake.
"...I believe that the Fed understands that we are closer to the next economic recession than not. For the Federal Reserve, the worst case scenario is being caught with rates at the 'zero bound' when that occurs. For this reason, while raising rates will likely spark a potential recession and market correction, from the Fed’s perspective this might be the 'lesser of two evils.'"
Following last month's narrative-crushing drop in retail sales, despite all that low interest rate low gas price stimulus, January was more of the same as hopeful expectations for a modest rebound were denied. Falling 0.8% (against a 0.9% drop in Dec), missing expectations of -0.4%, this is the worst back-to-back drop in retail sales since Oct 2009. Retail sales declined in 6 of the 13 categories.
The dominoes are beginning to fall. The initial spark in 2008 has triggered a series of unyielding responses by those in power, but further emergencies and unintended consequences juxtapose, connect and accelerate a chain reaction that will become uncontainable once a tipping point is reached. The fabric of society is tearing at points of extreme vulnerability, with depression, violence and war on the foreseeable horizon. Mr. President, the shadow of crisis has not passed. The looming shadow of crisis grows ever larger and darker by the day as this Crisis enters the most dangerous phase, where the existing social order will be swept away in a torrent of carnage and ferocious struggle. We are not a chosen people. We are not immune from dire outcomes.
Houston, You Have A Huge Problem: One-Sixth Of US Office Space Under Construction Is In This Texas CitySubmitted by Tyler Durden on 02/11/2015 10:59 -0400
"According to the University of Michigan survey, consumers have not been this upbeat since January 2004, when the economy was booming. The natural outcome should be for consumers to splurge, hitting the malls and going out to restaurants. But much to our surprise, the data suggest otherwise." - BofA