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About That Surge In Retail & Construction Jobs

Tyler Durden's picture




 

As one witty observer noted over the weekend, "no one with an IQ greater than their shoe size, save corrupt, captured American economists, buys the fake October unemployment report," and while we agreed with the pretext of his thesis, we thought a quick sanity check on the sudden surges in Retail employment and Construction jobs and wage growth would help clarify a few things for those who 'believe' in miracles. As the following two simple charts show, we have seen this odious pattern of mal-investment, mis-allocation, and erroneous executuve extrapolation before... and it did not end well.

First - Retail..

Something stinks. Retail stock prices have been plunging (despite the promises of increased spending amid expectations of wage growth - which today NYFed admitted was at its lowest on record) and just tonight we see Banana Republic see Same Store Sales collapse 15% and Gap overall down 4%.

We have seen this before...

Coincidence we are sure.

Second - Construction.

Having already pointed out the anomalous surge in construction jobs weekly payrolls print, we thought exposure of the raw underbelly of the construction industry would help. As Framing Lumber prices crash over 21% year-over-year, it just seems odd that construction jobs would keep surging onwards and upwards as if nothing had happened. Of course, this 'confidence' in the face of market-implied doom has been seen before...

And did not end well.

*  *  *
So apart from Retail and Construction sectors entirely decoupling - in an almost perfect replay of the lead-up to the last crash - it seems everything is on target for a rate hike.

 

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Mon, 11/09/2015 - 21:34 | 6770387 Leopold B. Scotch
Leopold B. Scotch's picture

Nantucket sleighride!

Mon, 11/09/2015 - 21:42 | 6770414 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

The bigger lag makes an even larger snag!

Mon, 11/09/2015 - 22:18 | 6770521 LowerSlowerDela...
LowerSlowerDelaware_LSD's picture

HOLY SHIT!  Those charts are something else.  Perfect match without twisting, turning, and extrapolating.

 

Do the rate hike.  Better sooner than later.

Mon, 11/09/2015 - 22:43 | 6770666 Oldwood
Oldwood's picture

But it is different this time...it's always different this time....really, really different....and not in a good way

Tue, 11/10/2015 - 00:02 | 6770939 847328_3527
847328_3527's picture

" It's contained. "

Tue, 11/10/2015 - 00:05 | 6770952 Shumbies
Shumbies's picture

"...Largely"

Tue, 11/10/2015 - 07:44 | 6771461 Rex THT
Rex THT's picture

How can you tell when Obama is lying?

 

When you see his semen stained teeth and purple gums....

Tue, 11/10/2015 - 08:33 | 6771554 RaceToTheBottom
RaceToTheBottom's picture

Increment n in QEn.

Next?

 

Tue, 11/10/2015 - 08:05 | 6771499 Antifaschistische
Antifaschistische's picture

the real story is told with income tax revenue.  When someone takes a job at 1/2 their prior income the employment number remains the same, but tax revenues fall off a cliff.

Too bad someone told the IRS to stop publishing on this site in 2010.  I'm sure it's out there somewhere in a non obvious location.

https://www.irs.gov/uac/SOI-Tax-Stats-Individual-Information-Return-Form...

 

Tue, 11/10/2015 - 02:14 | 6771171 glenlloyd
glenlloyd's picture

25 bps is hardly a rate hike. Even then it'll be quickly pulled back when everything falls apart.

As others have said, it might be an attempt to save face by the Fed or it might be an attempt to reload the 'bazooka' for the next go round (hardly).

It'll be interesting to see just how the odds play out the closer we get to rate hike event horizon.

If I was a betting man I'd wager there will be no hike. They literally can't do it, they're all crack whores addicted to free money now. They were warned about the moral hazard they were embarking on but did they listen? NO!

Tue, 11/10/2015 - 08:08 | 6771504 Antifaschistische
Antifaschistische's picture

the Fed was instructed not to disrupt the 2015 bonus season for Wall Street.  It's what I believe, and not what I can "prove".  But I do believe that Wall Street income/bonuses have been generated solely from the Fed's incremental easing.  They are the cream of the parasite class on America.

Tue, 11/10/2015 - 06:10 | 6771392 Big_Hitman
Big_Hitman's picture

My last pay check was $9500 working 12 hours a week online. My sisters friend has been averaging 15k for months now and she works about 20 hours a week. I can't believe how easy it was once I tried it out. This is what I do... www.wallstreet34.com

Mon, 11/09/2015 - 21:35 | 6770393 DeadFred
DeadFred's picture

You're saying we have a year and a half until the crash? Not likely.

Mon, 11/09/2015 - 21:43 | 6770416 chairman of the...
chairman of the bored's picture

Cycle research says 2017,so yes, a year and a half.Get plenty of Jiffie Pop(love that shit!)relax and wait...its coming...

Mon, 11/09/2015 - 21:56 | 6770454 Gambit
Gambit's picture

Fuck I can't wait that long!

Mon, 11/09/2015 - 22:17 | 6770548 Mr. Magoo
Mr. Magoo's picture

By looking at all these stats plus the Baltic dry and Shanghai and china containerized freight index dropping at the busiest time of the season it seems that we are in worse shape than 2008 but they are doing one hell of a job covering this up. 

Mon, 11/09/2015 - 22:11 | 6770524 Consuelo
Consuelo's picture

 

 

Do you think U.S. foreign policy precipitates something 'untimely' before 2017?  If yes, you answered correctly...

Tue, 11/10/2015 - 06:17 | 6771404 Vinividivinci
Vinividivinci's picture

Better not take that long to crash...I can't take this shit show here in Kanada anylonger...50 years old, only min wage work available, can barely afford to support my last luxury, cigs. Cunts.

Mon, 11/09/2015 - 21:43 | 6770398 Xatos
Xatos's picture

I hope this doesn't mean we have 2-3 years left. I've got a boat full of silver burning a hole in my pocket. But yes, this points towards more evidence of a bubble. The evidence never stops coming, but my goodness this gravy train knows no end. 

Mon, 11/09/2015 - 22:06 | 6770487 Casey Jones
Casey Jones's picture

When the other option is let the chips fall where they may, then extend and pretend is the ONLY option. There's no telling how long they can go. They're all in.

Mon, 11/09/2015 - 22:02 | 6770420 cowdiddly
cowdiddly's picture

The construction jobs always have a temporary spike in October. This is when all the Powerplants around the country start going down for maintenance after the summer peak demand and to get patched up for the winter heating season. Electricity demand and rate price are down to lows at this time so its the best time to schedule repair. You can take a couple plants of grid while the others generate.

Dont worry, they are temporary, short term contracted jobs that only last between 2weeks to 3 months each and then it back  to the Unemployment line. I got friends who do this kind of  stuff. They are counted as and called construction workers but they are really industrial maintenenance work.

seasonally adjusted of course.

Tue, 11/10/2015 - 03:39 | 6771278 undertow1141
undertow1141's picture

You mean like the retail surge in November for Christmas help, say it ain't so.

Tue, 11/10/2015 - 06:48 | 6771426 bmr22
bmr22's picture

Sounds about right and lets not forget all of the seasonal Christmas help that gets hired for 8 weeks and then gone. Oh I hope I did not offend anyone by using the word Christmas, maybe I should have said the holiday shopping season hahaha.

Mon, 11/09/2015 - 21:50 | 6770426 foodstampbarry
foodstampbarry's picture

Was at the gym today and cnbc was on, couldn't turn the channel cause somebody hid the remote. Some assclown was on and he was saying that lower income AMericans are feeling more postive about their financial future. I shit you not. And he said it with a straight face.

Mon, 11/09/2015 - 21:58 | 6770458 Rubbish
Rubbish's picture

My gym is the range and lifting a 7 lb. SD shotgun. Sometimes I only get it waist high.

 

Gold Bitchez.....I pick up pennies

Mon, 11/09/2015 - 22:18 | 6770550 Ajax_USB_Port_R...
Ajax_USB_Port_Repair_Service_'s picture

CNBC must have been talking about low income illegals.

Mon, 11/09/2015 - 22:19 | 6770564 LowerSlowerDela...
LowerSlowerDelaware_LSD's picture

I should have been at the gym today.

Mon, 11/09/2015 - 22:22 | 6770577 InnVestuhrr
InnVestuhrr's picture

He was teling the truth because he was very well paid for that opinion :-)

Mon, 11/09/2015 - 22:39 | 6770647 Berspankme
Berspankme's picture

Was Obama there lifting his 5lb bells?

Tue, 11/10/2015 - 00:07 | 6770957 Shumbies
Shumbies's picture

Bellends

Mon, 11/09/2015 - 23:16 | 6770788 silverer
silverer's picture

Did the camera follow him offstage where he counted the money?

Mon, 11/09/2015 - 22:02 | 6770475 scatha
scatha's picture

The pauperization of the US and the West continues and those phony job numbers do not change anything. The global income of ordinary peoples and demand for goods and commodities continue to collapse while the "real" inflation explodes. The capital flight from EM is a direct consequence of the global demand collapse and associated currency wars and China's decision to depeg and devaluate at least 30% to reach a par with other Asian currencies including yen in next 12-24 months.

Here is more about rampant "real" inflation reigning in the real economy that scares a shit out of banksters if FED was going to do something about it:

https://contrarianopinion.wordpress.com/economy-update/

Mon, 11/09/2015 - 22:03 | 6770477 loveyajimbo
loveyajimbo's picture

As a leader, Obama has no peer... he has done more for his people than any leader in the last century.  Too bad his people are radical islamists, marxists, illegals and homosexuals.

Mon, 11/09/2015 - 22:21 | 6770572 InnVestuhrr
InnVestuhrr's picture

and drug addicts, alcoholics, entitlement parasites, and common criminals.

Mon, 11/09/2015 - 22:37 | 6770641 Berspankme
Berspankme's picture

don't forget trannys

Mon, 11/09/2015 - 23:58 | 6770924 venturen
venturen's picture

1% and bankers

Tue, 11/10/2015 - 00:03 | 6770943 847328_3527
847328_3527's picture

" The Obama Legacy "

Mon, 11/09/2015 - 22:11 | 6770526 cornflakesdisease
cornflakesdisease's picture

Houston Texas has apartments going up everywhere, and on every corner.

 

Huge bubble.  This will not end well.

Mon, 11/09/2015 - 23:09 | 6770769 buzzkillb
buzzkillb's picture

Same thing in Los Angeles. Start at Downtown and draw a 15 miles radius circle. What's coming down the pipeline is insanity. No lack of construction as long as banks still exist. This is '05 on steroids.

Mon, 11/09/2015 - 23:48 | 6770902 kbohip
kbohip's picture

You should see Denver.  Ho.  Ly.  Shit.  I've lived here in Colorado since 1986 and I've never seen new residential construction like what's going on now.  Prices for rent and homes are through the roof now too.

Tue, 11/10/2015 - 06:12 | 6771397 Vinividivinci
Vinividivinci's picture

I live downtown Montreal...same shit here.
Condos, condos and condos...everywhere. Not to mention new highrise apartment/hotels. The vacancy rate is up around 5% and the job market is non-existant, except for waiter, dishwasher and low paying warehouse work...total bullshit and windowdressing this "housing boom".

Tue, 11/10/2015 - 00:00 | 6770929 venturen
venturen's picture

NJ...they are building 1000 unit condos one after another...but no wants to move there...there are no new companies...people are fleeing...they buiild to make the numbers look good. IT IS A DISASTER

Tue, 11/10/2015 - 00:05 | 6770951 847328_3527
847328_3527's picture
Houston’s Real Estate Market Feeling The Effects Of Oil’s Price Drop Don’t be fooled by claims of economic diversification—the city still runs on oil.

 

http://www.texasmonthly.com/the-daily-post/oils-price-drop-is-spreading-...

 

I saw Houston during the last severe oil recession. Downtown was a Ghost Town.

Tue, 11/10/2015 - 07:52 | 6771470 grumpyoldgit
grumpyoldgit's picture

Gotta put the Syrian refugees somewhere....

Mon, 11/09/2015 - 22:11 | 6770527 coast
coast's picture

Off topic but I have a burning question...my girlfriend has a B of A bank account...once a month they take 25 dollars out of her account but then they put it back in on same day...wtf?

Mon, 11/09/2015 - 22:11 | 6770528 coast
coast's picture

Off topic but I have a burning question...my girlfriend has a B of A bank account...once a month they take 25 dollars out of her account but then they put it back in on same day...wtf?

Mon, 11/09/2015 - 23:20 | 6770805 bonin006
bonin006's picture

US Bank does the same thing with my checking account, only its $19.95.

I think they are telling you what a valuable customer you are, that they are giving you money every month (the money they take out is a service fee, so that doesn't count)

Mon, 11/09/2015 - 22:14 | 6770529 coast
coast's picture

Off topic but I have a burning question...my girlfriend has a US bank  ccount...once a month they take 25 dollars out of her account but then they put it back in on same day...wtf?

Mon, 11/09/2015 - 22:15 | 6770541 Seasmoke
Seasmoke's picture

Wow you aren't kidding about having a burning question

Mon, 11/09/2015 - 22:43 | 6770664 coast
coast's picture

Lol seasmoke....gave u an up...using my tablet todày and it sucks...my apologies to all...

Mon, 11/09/2015 - 22:15 | 6770544 FreeNewEnergy
FreeNewEnergy's picture

Nothing like some good chart porn on a Monday night.

Love the "you are here" lines. Makes me feel like I'm noticed.

Mon, 11/09/2015 - 22:37 | 6770639 willwork4food
willwork4food's picture

Me 2. luv that chart eye candy.Especially with colors. Am I perverted?

Mon, 11/09/2015 - 22:34 | 6770627 arbwhore
arbwhore's picture

ZH "you are here" graphs are notoriously wrong.

Mon, 11/09/2015 - 22:39 | 6770646 ajkreider
ajkreider's picture

Except that lumber prices, like oil, are collapsing for reasons having nothing to do with US demand.  And the retail collapse coincided with the Lehman collapse.  Is it your claim that somehow retail jobs previewed a global bursting of real estate bubbles and credit default swap craziness?

 

 

Post hoc ergo propter hoc

Mon, 11/09/2015 - 22:42 | 6770663 tommylicious
tommylicious's picture

Lumber prices...that's like from the Lumbar Yard on Seinfeld?

Mon, 11/09/2015 - 23:12 | 6770777 silverer
silverer's picture

"You are here".  Well, I guess I'll just stand in the middle and let those two lines go around me.

Mon, 11/09/2015 - 23:52 | 6770910 kbohip
kbohip's picture

And just like the "You are here" on the maps at an unfamiliar mall, it's taking me longer than it should to figure out which way to go to get to where I want!

Tue, 11/10/2015 - 00:03 | 6770944 Make_Mine_A_Double
Make_Mine_A_Double's picture

It's all here in plain sight - basement commodity prices, merger mania, tip top housing and equities, profits down, fraud job and GDP - and on and on.

Every flashing red light seen in 2007-08. I think those charts are spot on.

Tue, 11/10/2015 - 04:37 | 6771326 explosivo
explosivo's picture

This is why I come to zerohedge! You guys are always right there with the relevant comparisons. Good job!

Tue, 11/10/2015 - 07:47 | 6771464 Last of the Mid...
Last of the Middle Class's picture

When you see a train coming, get off the fucking tracks.

Do NOT follow this link or you will be banned from the site!