Now that absolutely everyone is laser-focused more on the participation print, recently at 35 year lows, than the actual unemployment number which even the Fed has implied is meaningless in the current context, one thing to note is that while the overall number is a blended average across the US, it certainly differs on a state by state basis. 4In order to get a sense of which states are the winners and losers in the payroll to participation ratio, we go to Gallup, which conveniently has broken down this number on a far more granular basis. Gallup finds that Washington, D.C., had the highest Payroll to Population (P2P) rate in the country in 2013, at 55.7%. A cluster of states in the Northern Great Plains and Rocky Mountain regions -- North Dakota, Nebraska, Minnesota, Wyoming, Iowa, Colorado, and South Dakota -- all made the top 10. West Virginia (36.1%) had the lowest P2P rate of all the states.
We at the Fed are the platonic guardians of the global financial system. And our logic is undeniable….
The number of Americans that renounced their citizenship was 221 percent higher in 2013 than it was in 2012. That is a staggering figure, and it is symptomatic of a larger trend. In recent years, a lot of really good people with very deep roots in this country have made the difficult decision to say goodbye to the United States permanently. A few actually go to the trouble to renounce their citizenship, and that is mostly done for tax purposes. But most willingly choose to leave America for other reasons. Once upon a time, the United States was seen as "the land of opportunity" all over the globe and it seemed like everyone wanted to come here. But now that is all changing. As we have abandoned the principles that this country was founded upon, our economy has gone steadily downhill.
- Goldman to Fidelity Call for Calm After Global Stock Wipeout (BBG)
- Turnabout on Global Outlook Darkens Investor Mood (Hilsenrath)
- EU Said to Weigh Extending Greek Loans to 50 Years (BBG)
- Second Storm Hitting Northeast Halts Planes, Schools (BBG)
- Small Banks Face TARP Hit (WSJ)
- As Sony prepares PCs exit, pressure mounts for reboot on TVs (Reuters)
- IBM Uses Dutch Tax Haven to Boost Profits as Sales Slide (BBG)
- ECB faces dilemma with inflation drop (FT)
- London Subway Strike Snarls Traffic as Union Opposes Cuts (BBG)
Reality will reassert itself in 2014, with lemmings, flippers, and hedgies getting slaughtered as the housing market comes back to earth with a thud. The continued tapering by the Fed will remove the marginal dollars used by Wall Street to fund this housing Ponzi. The Wall Street lemmings all follow the same MBA created financial models. They will all attempt to exit the market simultaneously when their models all say sell. If the economy improves, interest rates will rise and kill the housing market. If the economy tanks, the stock market will plunge, creating fear and killing the housing market. Once it becomes clear that prices have begun to fall, the flippers will panic and start dumping, exacerbating the price declines. This scenario never grows old.
With analysts preferring gloss over the massive bellwether stock earnings misses, focus on non-GAAP manufactured releases, and cling optimistically to hopes that weak performance, inclement weather, and volatile currency fluctuations will all go away soon and that the future looks rosy. However, as Bloomberg's Richard Yamarone notes, the US economy continues to cling to an historical subpar growth and CEO comments hardly support any hope for a change.
If a third of all US homes cannot trade due to being underwater or not sufficiently above water to clear closing costs, then the US economy is going to suffer
Put down that prom dress. It seems, as ConvergEx's Nick Colas notes, Retail isn’t the only service moving from the brick and mortar world to the virtual one. Online high schools have been popping up (on the internet, of course) more and more often in the last few years: even Stanford University started a program in 2006. Of the 22 million high-school aged (14-18) population in the US, about 1 million are estimated to be enrolled in a class or a full-time high school online. That said, virtual schools are unlikely to replace traditional classrooms anytime soon: they’re still used mostly for supplemental or make-up courses rather than a complete education. But, Colas adds hopefully, the technology points in a positive direction: free high school education means more high school diplomas, which could lead to a higher labor force participation rate, lower unemployment, and higher earnings for those who might have otherwise dropped out.
And just like that, slowly but surely, the entire US foreign strategy vis-a-vis Iraq and its weapons of mass diversion destruction, is becoming all too clear. "The Defense Security Cooperation Agency notified Congress today of a possible Foreign Military Sale to Iraq for AH-64E APACHE LONGBOW Attack Helicopters and associated equipment, parts, training and logistical support for an estimated cost of $4.8 billion."
DOJ Finally Going After The Criminal Masterminds With Arrest Of 24 Year-Old Bitcoin Exchange FounderSubmitted by Tyler Durden on 01/27/2014 13:48 -0400
The US crackdown on Bitcoin has been long in coming, with ebbs and flows of enforcement as regulators have been unsure exactly how to proceed with dismantling the digital fiat alternative. This morning the ebb became a rising tide, after U.S. prosecutors announced charges against two men operating Bitcoin exchange businesses for attempting to sell $1 million worth of Bitcoin to users of the underground black market website Silk Road, which was shut down by authorities in September.... In retrospect Charlie's biggest crime was not being CEO of JPM or, at worst, HSBC, where money laundering and other criminal activity is not only encouraged but rewarded with soaring bonuses. The good news is that one can once and for all confirm that when it comes to "Justice" in the US, some - those who deal with legacy status quo mandated and enforced ponzi scheme fiat - are far more equal than anyone who dares to think outside the Fed's printer.
Selling hope, after all, is the stock and trade of the Sell Side. But we all need to take a step back and ask ourselves just where we stand on the proverbial economic timeline...
Back in the years just before the previous housing bubble burst (not to be confused with the current, even more acute one), one person did the math on subprime, realized that the housing - and credit bubble - collapse was imminent, and warned anyone who cared to listen - almost nobody did. That man was Kyle Bass, and because he had the guts to put the money where his mouth was, he made a lot of money. Fast forward to 2014 when subprime is all the rage again and the subprime bubble is bigger than ever: it may comes as a surprise to some that in 2013, subprime debt was one of the best performing fixed income instruments, returning a whopping 17% in a year when most other debt instruments generated negative returns. And this time, while Kyle Bass is busy - collecting nickels (each costing a dime) perhaps - it is someone else who has stepped into Bass' Cassandra shoes: that someone is Jeff Gundlach. “These properties are rotting away,”
If the extreme drought in the western half of the country keeps going, the food supply problems that we are experiencing right now are only going to be the tip of the iceberg. The size of the U.S. cattle herd has dropped to a 61 year low, and organic food shortages are being reported all over the nation. Surprisingly cold weather and increasing demand for organic food have both been a factor, but the biggest threat to the U.S. food supply is the extraordinary drought which has had a relentless grip on the western half of the country. According to the U.S. Drought Monitor, drought conditions currently stretch from California all the way to the heart of Texas. In fact, the worst drought in the history of the state of California is happening right now. And considering the fact that the rest of the nation is extremely dependent on produce grown in California and cattle raised in the western half of the U.S., this should be of great concern to all of us.
Back in August, when we wrote that "A Stunning 60% Of All Home Purchases Are "Cash Only" - A 200% Jump In Five Years" based on Goldman data, many laughed, unable to fathom that the majority of the US housing market has become a flippers' game played by institutions and the uber wealthy, who don't need a stinking mortgage to buy that South Beach mansion. As it turns out we were just a little ahead of the curve as usual, and as real estate company RealtyTrac reported overnight, with data that naturally is delayed due to the delayed impact of houses coming out of the much delayed foreclosure pipeline, "All-cash purchases accounted for 42.1 percent of all U.S. residential sales in December, up from a revised 38.1 percent in November, and up from 18.0 percent in December 2012." That's a 10% increase in one month for a 6-9 month delayed series, which means that in reality, roughly about 60% of all homes are now purchased with cold, hard cash.