It's Not So Rosie: What Keeps A Gloomy Realist Up At Night

Tyler Durden's picture

Yesterday, we were offered 'hopes and prayers' by Gluskin Sheff's David Rosenberg. However, as he warned then, there are some things to be worried about. From the wide gaps in voting patterns across socio-economic lines and the expectations that populist policies will be the hallmark of Obama's second term to the mixed-to-negative data across employment data, consumer spending indications, housing, and Europe; it appears the market is starting to price in some positive probability of a fiscal cliff and these macro data do nothing to subsidize that reality.


Via David Rosenberg of Gluskin Sheff:

The wide gaps in voting patterns across socio-economic lines were as wide as they have ever been (55% of those earning more than $250,000 voted for Romney, while 42% voted for Obama; 59% of the white vote went to Romney, just 39% to Obama: the black vote went 93% for Obama and just 6% for Romney). If Obama caters to those who voted for him, then we can certainly expect populist policies to be the hallmark of his second term. Let's hope in this quest for greater income equality that he doesn't narrow the band by dragging everybody's purchasing power down. While the President does not face the Great Recession of four years ago, he does confront the "Not So Great Recovery" nonetheless.


The data remain broadly mixed, but even data like the last jobs report are lacking the necessary wage-based income growth needed to generate sustainable growth, let alone durable above-potential growth. The recently-released .JOLTS report (Job Opening Labor Turnover Survey) showed a jobs market that in fact is taking three steps back for every step forward. One step back was the job openings number, which in September sank 100k, down two of the past three months to a five month low of 3.561 million (much lower than the market call for a modest decrease to 3.65 million). The second step back was in hiring activity, which also shrank 255k in September, down three of the past four months and the largest decline since April 2011. The private sector cut 201k jobs and the public sector shed 55k. And the third step backward was in the number of job quitters which fell 175k in what was the sharpest falloff since November 2008 - as well as being the third drop in the past four months (fewer voluntary job leavers is suggestive of lower worker confidence). The step forward, thankfully, was in the layoffs component, which slid 147k, down two of the past three months. At least the slips aren't turning pink even more, even if HR departments aren't very busy placing job ads either.


This subdued employment backdrop along with the disruption from Sandy is predictably exerting a drag on consumer spending growth at this crucial seasonal period for the retail sector when merchants had been busy preparing for what prior surveys had been foreshadowing - a decent holiday shopping backdrop. Unfortunately, the ICSC (International Council of Shopping Centres) index showed that same-store sales fell 0.2% for the week ending November 3rd and were up 1.4% YoY. Month-to-date, sales fell 0.2% MoM and were up 1.4% from year-ago levels - below consensus views of a 2-3% YoY gain. The comparable Redbook survey confirmed this result Chain store sales were off 0.6% MoM thus far in November and up 0.8% YoY running below the 2.1% sales target. The consumer frugality theme has hardly gone away as well - with the latest fad for the coming holiday season being 'slim Christmas trees'. Have a look at Svelte for the Holidays on page D1 of Wednesday's WSJ.


On the housing side, signs of sputtering are coming to the fore. Total mortgage applications in the November 2nd week declined 5%, and have sagged now for five weeks in a row - sliding at an annual rate of 95%(!!) during that period. Applications for new home purchases slipped 4.8% and are down two of the past three months. The prior boom we saw in mortgage refinancings is also over as the MBA Refinancing index dropped 5% during the same week and has declined now in each of the past five weeks.


Overseas events are also quite challenging. Greece faced a contentious vote in parliament over $23 billion of fresh government spending cuts (narrowly passed yesterday and needed as a quid pro quo for $40 billion in rescue financing from its creditors). Here in the U.S., another storm in the Northeast is on its way which once again is likely to disrupt economic activity in a part of the country that represents 20% of GDP (five times the share we typically see directly affected when these disasters hit the deep south). Geopolitical tensions are back on the front burner too - especially the more bellicose tone coming out of the Israeli leadership (see Netanyahu Says He'd Go It Alone on Striking Iran on page A5 of the Wednesday NYT). Angela Merkel said this week that "whoever thinks this can be fixed in one or two years is wrong" and this sentiment was affirmed by Mario Draghi yesterday and ratified by the latest slate of German data (industrial orders collapsed 3.3% in October on top of a 0.8% decline the month before: a final reading on the manufacturing-services PMI fell to 47.7 in October from 49.2 in September), which now suggest that German GDP is going to contract in Q4 as the euro zone recession deepens and spreads out to the north.

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NotApplicable's picture

Ok, I'm surprised that Romney got 6% of the black vote.

otto skorzeny's picture

a lot of bumpy face gin will mess with your fine motor skills

Zer0head's picture

So Rosie calls the present economic climate a "Not so Great Recovery" WTF is up with that statement? when did he ever tell us that we were entering a recovery of any type?

otto skorzeny's picture

when you are in that top sliver of the socio-economic strata a recession means having to buy a Rolls Royce Ghost instead of a Phantom.

Fredo Corleone's picture

As Our Man Rosie is firmly bulwarked in the snows of Ontario, he is likely more of a Mercedes G550 kind of chap.

SmallerGovNow2's picture

While the President does not face the Great Recession of four years ago, he does confront the "Not So Great Recovery" nonetheless....

what recovery?  WTF are you talking about?  We are headed into global economic collapse...  What fucking planet do you live on?

Captain Kink's picture

if you are on the dole, you dont feel recessions at all, as your income and net worth do not change.  if you are upper income and/or net worth brackets, you feel recessions acutely.  This dynamic can be extrapolated to raising taxes on the upper bands.  

Thankfully, the Bernank's got our backs.  What recession?  

Flakmeister's picture

Let's see....

Herman Cain, Alan West, Alan Keyes, J.C. Watts...

Umm, this might take a while....

SmallerGovNow2's picture

Colin Powel is a racist son of a bitch who admited that he voted for BHO because of skin color...

Nobody For President's picture

See above where the white vote went. But no racism there, right?

what a tool...

Bedonkedonk's picture

60/40 is a racist split? What color is the sky on your planet?

Black people vote for black people, with few exceptions.
Accept it or cry about it, but don't make yourself look like an idiot by comparing a 94/6 split to a 60/40 split. 

Kitler's picture

Colon Bowel is a definite "no".

Zero Govt's picture

Kitler, luv your avatar, whatta chuckle ;))

Urban Redneck's picture

Flak, since I'm assuming you like math

What are the odds that across at least 39 polling places and over 14,000 votes in Philadelphia that NOT A SINGLE accidental vote went to Romney?

Flakmeister's picture

Hard to answer without more data, maybe if you gave me an independent error rate I could estimate it....

Remind, how many votes did Romney loose PA by?

Urban Redneck's picture

The error rate is my the problem (since I 'm searching for an answer that's an actual number and not a function) . I can't find an error rate specific to user input errors (as opposed to tallying, spoilage, undervoting, etc.) But here is everything I do have-

Just running through the wards where the Obama vote was over 98% and then reviewing the individual polling places/districts within those wards- I came accross 39 districts where 14,160 Obama votes were cast, 17 Other votes, 0 Romney were cast out of 14,160 ballots (avg 363 per district)

In Philadelphia, romney lost by 466,585

Obama  558,465
Romney  91,880
Other 5,123
Total 655,468
In a city with demographics
White 36.9%
Black 42.2%
Asian 6.3%
Hispanic & Other 14.6%

In Pensylvania, Romney lost by 292,047
Obama 2,887,221
Romney 2,595,174
Other 68,915
Total 5,551,310
In a state with demographics
White 79.2.%
Black 11.3%
Asian 2.9%
Hispanic & Other 6.6%



Urban Redneck's picture

I need a couple hours of shut eye, and but I came across another article on the same phenomenon in Ohio, but the statewide data is actually available in a single text file.

Urban Redneck's picture

That Ohio file above is actually county level data, (historical data at, and here is how it changes over time

2004 (D camp in an uproar w/ R Secretary of State)
6 places had 0 votes for Bush, and the largest only had 43 votes for Kerry

2008 (D camp smokin' hopenchange w/ D Secretary of State)
18 places had 0 votes for McCain, and the largest had 506 votes for Obama

2012 (R camp in an uproar w/ R Secretary of State) - not certified yet
19 places had 0 votes for McCain, and the largest had 597 votes for Obama

To put that in perspective Craig County, Virginia, is a place rednecks make fun of and blacks are scared hang out, yet
Obama performed worst in precinct 303 where he got 16.39% of the vote (20 out of 122 cast, in NO place did he get 0% of the vote)

I tried to get historical canvas records for Philadelphia but can't get to the city website for some reason, and if I could I'm not they are available there given the limited functionality of the BoE 2012 site.

I'm in & out and short on time, so I won't have time to go crazy with excel, but 500-0 distributions do not seem natural.



Urban Redneck's picture

If demographic data were available on the precinct level in OH or PA, would a Bayesian probability work out about the same?

At least a required error rate could be calculated

Kitler's picture

The ballots in Florida were very confusing.

divide_by_zero's picture

Chris Rock said Romney was blacker than Obama, mighta confused some of the voters.

vast-dom's picture



"While the President does not face the Great Recession of four years ago, he does confront the "Not So Great Recovery" nonetheless." 


How can you be so sure? We could have a crash any day now or a pretty devestating (____) Recession a la Japan indefinitely. Again, this unprecedented big gov=corp central meddling is a true econ wild card. What we do know for certain is that gov is destroying free markets and personal freedom.

NotApplicable's picture

Too bad he'll play his get out of jail free trump card.

Labeled WWIII

"In case of emergency, break class"

otto skorzeny's picture

I'll sleep a little better now that my new AK is here. Ordered it during O's election night speech.

Captain Kink's picture

Cool.  I'm going to assume that is true.  I don't need an AK, but I do need a handgun and a good all purpose birding shotgun.  Everything from duck to pheasant to gease.  Any suggestions out there?

Flakmeister's picture

And we sail into the Mystic...

Rainman's picture

Sheesh....expect not-so-great for everything in a country that's been pussified and socialized.


RSloane's picture

The only thing that keeps me up at night is my husband... :)

azzhatter's picture

I have no idea why but that gave me a little chubby

Dr. Engali's picture

A little chubby? A least you are honest.

PLira's picture

My, that escalated quickly.

Jay Gould Esq.'s picture

RSloane, perhaps the introduction of Breathe Right strips may help the night pass more restfully.

But I digress...

larz's picture

I know Azz Marriage and sex seem to diverge over time

Rathmullan's picture

The "president" absolutely faces the great recession of 4 years ago in redux as nothing fundamental has changed to fix what was a systemic breakdown brought on by a banking cartel gred and a government that distorts price signals through its policies. The literal "papering over" of that breakdown will make the redux version worse.

SmallerGovNow2's picture

yes fundamentals have changed, they are way fucking worse...

divide_by_zero's picture

Greater Depression is more like what he's facing, the more they kick the can the greater the depression.

Manthong's picture

He’s built something much greater than a depression.

He gets to preside over the collapse.

Maybe then the fraud and subversion will come to light.

lolmao500's picture

Ron Paul gets it right again :

Ron Paul: Election shows U.S. 'too far gone'

"We're so far gone. We're over the cliff," the Texas Republican told Bloomberg Television's "In the Loop" program. "We cannot get enough people in Congress in the next 5-10 years who will do wise things."

"People do not want anything cut," he said. "They want all the bailouts to come. They want the Fed to keep printing money. They do not believe we have gone off the cliff or are close to going off the cliff. They think we can patch it over, that we can somehow come up with a magic solution."

lasvegaspersona's picture

me to the rest of the country: "good luck, you are on your own, I'm done trying."

earleflorida's picture

repeat after me...?, what comes after all great recession's, or in this concurrent scenario-- playing out in the good-ole USSofA as a stealthy 'homegrown-depression'__ 

Peter Pan's picture

America is no longer a big melting pot. It is a seething cauldron and if the economy hits a brick wall at some point and governments can no longer pander to the 47% on the one hand and  the bankers on the other with more money printing, then the potential for America to come apart at the seams is vastly increased.

Zero Govt's picture

".. the black vote went 93% for Obama and just 6% for Romney..."

in Virgina 95% of the black vote went to Bumma, only 5% to Rottey

nice to see blacks breaking the chains of racial stereo-typing and taking up the equal opportunity banner with such enthusiasm!!

of course it's not about racial lines, this is about Party lines. How has voting Democrat (suicide socialist) for decades served poor blacks in Detroit? Has promises, promises, promises, (more) promises, (even morezzz) promises from windbag lefties lifted you out of poverty, urban regenerated, community blooming and booming in socialist riches for all???

Or you still poor and dependent on State handouts with businesses (productive people) chased out from a thieving socialist grinding hell?

That's not to suggest you vote Republican, it's to suggest you give up the parasites (politicians) all-together, drop the parasite State that delivers you nothing into the sewer where it belongs and get a life

the best Govt is zero Govt, whatever your colour

SmallerGovNow2's picture

Libs are much better at lying to your face than rupubs. 

Zero Govt's picture

You'd think the Racial Equality Commission would be pulling their hair out right now at the blatant voting along racial lines eh?

They are afterall there to see there's no bias in society... 95% black-to-black vote compared to the much more moderate 'fair-share' white vote should have them blowing their trumpets all across the media 


despite their mandate to spot and challange racism, despite their ethnically mixed panel of judges to uphold fairness they're quiet as Church mice ...hypocracy so thick you'd think they had the peanut brains of State crones

so is whiteman the only enemy/target around here ...isn't that just a bit, well er, RACIST?????

another bunch of bent/blinkered State turkeys (regulators) leaves the goal posts wide open and show contempt for their job and the Law

Zero Govt's picture

"...Netanyahu Says He'd Go It Alone on Striking Iran...."

is that going to work Rosie, whattya think?

will it be as successful an Isreali foreign policy as Palestine?

80 years of 'success' there with the arrogant thug strategy.. always a winner that, just ask the Americans (don't ask to see the bill though, it's f'ing extortinate)

JR's picture

“If Obama caters to those who voted for him, then we can certainly expect populist policies to be the hallmark of his second term.” – Rosie

Hardly populist. The country is more severely polarized than ever before. And one wonders why the word "populist" was even used in this context. A populist approach would have been Ron Paul: opposed to war, favoring common sense government, and complete honesty about positions and never changing.

Obama is not a populist president; he’s a socialist dictator and a close associate of the bankers. He favors the cartel establishment that gives him the power and in order to operate his Administration, he lies about his positions and his situation.

And, btw, he is not moving along with the recovery; he is now going to be faced with dealing with the lies the bankers and have used to keep the stock market up, the latter one of the few arguing points for some kind of recovery.

There isn’t any realistic recovery. We have extreme, horrible unemployment; small business is on the rocks; savers are being deprived of their stored labor; private pensioners have been betrayed by government-privileged corporations; and America’s manufacturing base is gone, meaning the only leverage Rosie’s hopefuls have used for the recovery is government funding and wealth redistribution.

And that’s hardly a good point for Rosie to stand on.

My point is, we are now witnessing a huge split in the Republican Party between those who want to stand on conservative principles and those who want to become a companion party to the Democrats in order to help its leaders stay in Washington. This fight in the Republican Party is one of the good results coming out of the election. For both the Republican Party and the Democrat Party were commandeered by the same operatives—the neoconservatives and the neoliberals - the two wings of the same bird of prey.