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Why Is Goldman Suddenly Banging The Table On The Scariest Chart In The Jobs Report
Following the January jobs report, Goldman's chief economist Jan Hatzius appeared on CNBC but instead of joining Steve Liesman in singing the praises of the "strong" the report (which apparently missed the memo about the crude collapse), he decided to do something totally different and instead emphasize the two series that none other than Zero Hedge has been emphasizing for years as the clearest indication of what is really happening with the US labor market: namely the recession-level civilian employment to population ratio and the paltry annual increase in average hourly earnings.
This is what Hatzius said (2:40 into the clip):
"The employment to population ratio is still 4% below where it was in 2006. You can explain 2% of that with the aging of the population that still leaves quite a lot of room potentially, and the wage numbers are telling us we are just not that close, although we are getting closer."
Full clip:
Closer to what? Why the most dreaded event for any FDIC-backed hedge fund in the world: the Fed not only ending some $3 trillion of liquidity injections but actively starting to remove liquidity by tightening monetary conditions and rising rates.
Hatzius' punchline: "I think the case for "patience" is still quite strong." In other words, the US may be creating almost 300K jobs per month, but stocks are still not high enough.
So how should one look at today's BLS report: well, for political purposes the data is great - just look at those whopping revisions; but when it comes to the markets, please focus on the the unadjusted, ugly details beneath the headlines. Those which we have been showing for months and months. Because there always has to be something that prevent the Fed from hiking, and killing Chuck Prince's proverbial music, in the process ending Wall Street's 6-year-old "dance" ever since the 666 S&P lows.
At this rate soon Goldman Sachs will become a bigger "skeptical realist" than Zero Hedge.
Finally, which chart is Hatzius talking about? The one below, showing the uncanny correlation between the US civilian employment to population ratio and the annual rate of increases in hourly earnings, and the fact that neither is capable of actually increasing under the "NIRP Normal" recovery.
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"Jan Hatzius" That's not even an AMERICAN name! Europeans at the helm.
Banksters have zero country affilitation, as they consider themselves to be gods - or at least doing God's work.
Hourly earnings as in Me love you long time ?
Jan assHatzuis
The labor market is tightening? From a 30-year low participation rate to a 29 year low? What the fuck are these people talking about?
It's complicated stuff, and we are too stoopid to understand. Got that muppet?
Goodwork ZH
You can only say Recovery so long
Layoff List: http://www.dailyjobcuts.com
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This has to be the most poorly recorded CNBC clip on youtube.
Slo mo death of a nation.
I went to another 92 yr old family business seed, grain, garden, chicks...closed. The corporate iron hammer.
I guess Goldman Sachs gets it's news from ZH!
By labor market tightening he means people getting squeezed and having to work more for less (if they have work).
I've met mumerous 65+ folks in the past few months who had good careers and saved but who are back in the labor force for the money; the pension, the S.S., the IRA/401K is not enough to pay for healthcare, housing, insurance, utilities, taxes, food.
max
that is usually quoted in 'minutes'
American name? What would that be? Running Bear, Little Feather, Two Dogs Fuuking?
Hatzius' Indian name is "muppet raper."
Walmart shopper.
Not sure.
Do you pronounce that "Hates us"?
They hates us cuz they aintz us
Is LIESman an American name?
....even German.....uh, who would have thougt so, but, GS knows full well how to 'allocate' nationalities on their score board! God gave them the "modus operandi" manual!
Unless your name is Sitting Bull, etc your name isn't "American" either. History much?
Goldman looks so smart telling you what I've been screaming all morning.
Fools. Idiots. Morons.
Stop buying stocks and bonds on margin.
Stop? Sorry, but there is no such button on this ride.
but, but stawks!
Jan Brady could beat this guy up.
lol - i think the case for fraud, ponzi and corruption is stronger
Goldman is the wolf coming to the pig's rescue.
How many pigs did you eat this morning?
How many of you idiots will lose money today?
Beware of the Trojan Horse.
These fuckers don't even feel the need to hide in the horse any longer.
Who's going to prosecute?
Lynch?
LOL!
I believe that would be a Goldman horse
QE6! If we just borrow more...it will be alright
Chuck.
Wonderful comment !
The daytrader will be killed in 2015 the same way they were killed in 2000, with margin calls.
Said another way...
"We are scared to death the Fed is stupid enough to start raising rates so we need to edu-mecate them otherwise"
Today proves to me that Goldman already knows what the Fed is going to do.
The Fed isn't going to raise rates in June.
Goldman is going to milk this cow.
GS forged the Greek's accounting to ensure one day Greece's debt would hurt the Euro and potentially blow up the EU. It's by design so that the USD is guaranteed to survive the Euro which is a stronger currency in a far larger economy than the US.
GS also instrumental in peddling US debt and later-on aiding the US in defaulting on its obligations by telling its goons at the Fed to run the printers.
Draghi is ex GS and running the ECB and the Euro into the ground.
It's just one gigantic conspiracy to support the US and the US Dollar cabal.
BRICS could easy adopt Canada and expand into the Eurozone.
No wonder the US is running the old template to try and foister wars upon us in every corner of the world.
But if the world stands together against the US, this conspiracy can be overcome and a new system can emerge.
walküre
I'm not necessarily disagreeing with your theory about this conspiracy, but how exactly do you envision all these other countries rising up against the US?
Through the UN, IMF, or world bank issuing a single currency?
Canada is a drop in the world wide bucket with only .5% of the world's population, and they're no prize debt-wise either. Canada would be slitting its throat if it rejected the US.
IMO, this shit will come down to individual and family survival. Political borders will disappear.
tits for brians: For your information, Canadians burned down the White House in the War of 1812, and will do it again if you bitches try to steal our land, resources.
Nah. We're gonna have a war instead. Plenty of examples in history to show how this has to go.
Raise rates and lets get this fuckn' show on the road.
So, if I take the Birth/Death Model divide by the square root of Hillary's Fat-Ass, I get the BLS Number? WOW
Pr(Xtn+1 = in+1 ! Xt0, Xt1 + i1, = i1,....XXtn = in) = pinin+1(tn+1 - ttn) / (( o )) = BLS
It's all coming back around to the free money, or a lack thereof. GS and Wall St doesn't give a rip about jobs or peasants pay, they want free money and more of it!
I believe this is a case of sprinkling a little truth in with a bunch of lies to gain credibility. Most people are aware that the economy sucks. They can’t lie 100% of the time or the charade would end quicker. The bigger truths will remain hidden by the gatekeepers. They will keep their precious Fed hidden in the dark. It’s good to keep an eye on what these ‘experts’ are saying, but don’t read much into anything ever say.
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Translation from Goldmanese to English -- "Ve need to keep finding MOAR obscure data to prevent those Schweinhunds at the Fed from raising rates and turning us into just a bank"
Why am I reminded of "Robert's Box" by Procol Harum? You know, the song about a junkie pleading to a doctor for just one more fix? Goldman is singing this last line over and over...
"Just a pinch to ease the pain, I'll never trouble you again."
And that reminds me of https://www.youtube.com/watch?v=zWA6SOzHeCQ&list=RDzWA6SOzHeCQ crankit UP.
Someone just got fucked today.
How did it feel?
Why they don't just telly the truthy?
I think this proves beyond a shadow of a doubt that Keynesianism and Krugmanism are the proper path to utopia. Thoughts?
Keynesianism is spending money on things like interstate highways, new schools, roads, bridges, etc ... which creates job and leaves infrastructure that benefits the public for a long time.
Emptying the treasury into the pockets of the TBTF banks at a rate of a trillion a year isn't related to keynesianism or any other economic policy ... its corruption, theft and gangsterism. Nothing more, nothing less.
Likewise spending a trillion a year on a war machine based on a desire to dominate the world will end like all other such attempts ... in bankruptcy and ruin.
So wait, Goldman Sachs and the Fed AREN'T whores cohabitating the same bed?
It may just be a signal that it's time to flip the switch
actually there is a bit of tension there, the fed head is essentially a cabinet position, undersecretary of treasury, and while TARP and everything since 2008 has given the banks more power, what good is all that power if you can't use it? QE is a government regulation on banks, raising their reserve requirements, now that QE is over, the regulation is an unfunded mandate, and unfunded mandates never come to any good end. additionally the fed has been given surreptiously the power to create money, which they deploy through credit expansion (low interest rates) and monetization, but private financial credit demand, and shadow banking also creates demand for money (last month the monetary base expanded but not the money supply) [in 2007 this private expansion or creation of credit led to demand which caused the Fed to crash the market to get control of the process again, now the pressure is building once more] in simple terms its a free economy versus a centrally planned economy.
And the 92+ million Americans no longer in the workforce because they can't find work? That number isn't scary? The 1 Trillion we spend every year on .gov salaries, pensions, and perks....a scarier number???
Plus the trillion a year on the war machine.
But, but, but...
hmm lets see more people working fewer people collecting government benefits, so government shrinks and since government is the engine of job creation (hillary clinton) that means fewer jobs..
I love hearing these guys trying to talk their position. As markets going up they are saying "yeah it's because employment is strong and everything is great" Now they are about to get their free cookie jar taken way from them, suddenly it's "Things aren't great at all"
Same goes for Warren "the crony" Buffett.
If Greece leaves the Euro, the Fed won't be able to raise rates (in spite HAVING to because they would be fighting off currency devaluation).
Goldman would be fucked because if the Fed raises rates, ALL of its bets go sour and they get exposed.
Now of course the Fed, in my view, goes total Japanese and sits on CTRL-P......but that would cause some malfunction that results in social chaos (severe austerity). It always has.
This will be fun.
I don't think the FED does anything until GS is on the right side of the trade
Making the case for more QE?
So Goldman is making the case for continued free money courtesy of ZIRP...how unusual
Yes, fuckers, let me guess, "tanks in the streets"?
Fuck em.
What is there to "explain"? The black market is booming. The "official market" is what it is...
Full faith and credit.
one of the worst economists on the street. He is particularly unimpressive in person to listen to.
No one has said the economy is doing great or that workers should be happy. But the relentless doom and gloom message is odd. Sure things aren't where they were in 2006, but they are a hekuva lot better than where they were in 2010 or 2011. It was a good jobs report, and while it doesn't get us where we want to be it is a step in the right direction.
Go back to watching cnbc and drinking the fema supplied koolaide, because yuou simply can't handle the truth........or refuse to recognize and accept it.
Ever heard of 'statistical adjustments'.
how can she say we are near max employment when there's 100MM people unemployed?
BTW, is Jan Hatzius the famous token n...... in the God's factory?
You mention a $3 trillion QE.
My research indicates a QE of $12-$18 trillion. Our difference is owing to unrecognized consequences of governments’ attempts to guarantee bank deposits.
By these attempts, the government would seize a failed bank and guarantee all deposits up to, for example, $250,000; amounts over that limit would be lost.
This immediately created major problems for individuals and companies with larger deposits. A company with a “cash” (checking account) balance of $5,000,000 (add as many zeroes as you like), was suddenly at risk to lose very large amounts of money.
A relative stampede ensued as large depositors sought means to avoid these losses. A result was a so-called zero-balance checking accounts (aka many names). By this operation, balances would be swept into US Treasuries at the close of business every day. Then, if the bank failed (was seized) after closing, the company would lose nothing.
Soon, there weren’t enough Treasuries to meet demand. This led to the huge demand for Mortgage Backed Securities (MBS) as alternatives to US Treasuries.
As a result of these operations, huge amounts of “money” disappeared from the so-called “monetary base”; which, formerly, consisted of paper currency and bank reserves. Pre-crisis of 2007, this “monetary base” stood at $0.9 trillion, as evidenced by the Federal Reserve balance sheet. The resulting invention of “cash equivalents” has ballooned to somewhere between $12 and $18 trillion.
So, in the time of some 7-8 years, the “money supply” has ballooned from $0.9 trillion to $15 trillion (approx.). What Price Gold… will give you more dots to connect.
What do you think lies ahead? That’s right: a hyper-inflation of the dollar to extinction; and it will take everything with it – on a planet-wide scale.