Non-Manufacturing ISM Ignores Banker Layoffs, Surges Past Expectations On Biggest Jump In Employment Index Ever

Tyler Durden's picture

And another major economic indicator beat, this time coming from the January Non-manufacturing ISM data, which unlike yesterday's miss in the manufacturing ISM, surged past estimates of 53.2, up from a revised 53.0 in December, to a whopping 56.8 in January. The primary reason for this was the reported jump in Employment which rose from 49.8 to 57.4, which was the biggest jump pretty much ever (see chart below), and the highest employment number since 2006. And this happened in a month in which the banking sectors laid of thousands of bankers. Brilliant. We leave it up to readers to estimate the credibility of this report. In other news, inflation is back, as the report states that "Corrugated Cartons is the only commodity reported down in price." What was up? "Airfares; Beef; Chemical Products; Chicken; Crab; Coffee (2); #1 Diesel Fuel (2); #2 Diesel Fuel (3); Fuel; Gasoline; Medical Supplies (2); Paper; Petroleum Based Products; Resin Based Products; Vehicles; and Wire." In other news, factory order missed expectations of a 1.5% increase, coming in at 1.1%. But who cares: it is an election year and the propaganda machine is on in full force.

Here is the "credible" jobs number.

And the full breakdown from the Non-mfg ISM:

What the respondents are saying:

  • "Overall business conditions to improve. We continue to outperform previous business cycles." (Information)
  • "We are seeing increased contractor bidding and activity in Q1 2012." (Construction)
  • "Small business borrowing continues to be slow." (Finance & Insurance)
  • "New fiscal year, new budgets — expecting to show an increase in sales in first quarter." (Other Services)
  • "Economy continues to show signs of improvement and the company revenue is improving slightly, but is very susceptible to pricing and cost  pressures." (Professional, Scientific & Technical Services)
  • "There seems to be some stabilization in the economy as well as [in the] supply chain. This seems to be calming inventory and sales positions." (Retail Trade)
  • "Business is still stable; however, inflation in food prices is still a problem." (Wholesale Trade)

Finally, commodities up and down in price:

Commodities Up in Price

Airfares; Beef; Chemical Products; Chicken; Crab; Coffee (2); #1 Diesel Fuel (2); #2 Diesel Fuel (3); Fuel; Gasoline; Medical Supplies (2); Paper; Petroleum Based Products; Resin Based Products; Vehicles; and Wire.

Commodities Down in Price

Corrugated Cartons is the only commodity reported down in price.

Commodities in Short Supply

Crab; #2 Diesel Fuel (2); Fiber Cable; and Pharmaceuticals.

Note: The number of consecutive months the commodity is listed is indicated after each item.

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BaBaBouy's picture

Yeah, New Jobs At Wallmart ...

Careless Whisper's picture

The Careless Whisper Morning Update & Threadjacking


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KingPin 999's picture

Would someone at Zerohedge take a look at this BLS birth/death model link. I can't tell exactly what is going on but the adjustments this month are massive compared to anything seen in the last year. It looks like Birth/Death (calculated quarterly now) were massive this month but I can't tell with this and all the other adjustments.

MillionDollarBonus_'s picture

Doomer libertarians and goldbugs have been absolutely HUMILIATED today - LOL. Silverbugs, doomer rednecks and lunatic conspiracy theorists are desperately trying to defend their reputations but it's simply futile. The global recovery is now undeniable.

taniquetil's picture

MDB nailed it this time! My retirement savings have been invested in Groupon, Zynga, and Friend Finder Networks. The social media revolution is coming and is in no way a bubble that's been ballooned up by Facebook's whopping earnings of $4 per user.

GeneMarchbanks's picture

'The global recovery is now undeniable.'

It all started in Greece.

TruthInSunshine's picture

Bullshit Labor Statistics (BLS) is doing its thang...

1.2 million working age people no longer have the honor & privilege of being 'counted' for purposes of tabulating unemployment + inherently flawed 'seasonal january adjustment' + a whole lot of temporary workers @ no benefits and minimum wage = turn an actual survey data of a loss of 2.6 million jobs into a BLS reported gain of 243,000 jobs.



....Recovery, bitchez!

Banjo's picture

The global recovery? Oh if you mean that your central planning politburo friends are stealing the wealth of the middle class so that everyone eventually ends up living a 3rd world lifestyle. Then "the recovery" and "green shoots" are all around us.

Cheers *raises glass*

Obadiah's picture

fuk i hope so

i gotz ads, skills and content I need to sell

i root for that fat jersey governor's picture

I just can't miss this opportunity to mock this site -- pathetic!

Everyday, it tried so hard to spin the news or data in a negative way and failed. Tyler is like a bitterly divorced wife trying to get back to her ex - just can't let go. Oh man...

Reese Bobby's picture

Sorry but you are too stupid to "mock" ZH.  e.g gold is significantly outperforming stocks YTD.


To me, you are just one of the last idiots that need to get long on margin before Mr. Market shuts you up for good.


Have a nice day.

dogismyth's picture

so true.  Its all a ruse from what I see.  They need to continually convince the doomers that things will fall apart tomorrow, oh wait, the day after tomorrow....oh wait.....

The best compartmentalized propaganda machine on the blog with regards to the market.  Been telling folks for months that 2012 will be a banner year.

johnQpublic's picture

dear million dollar fool,

note:corrugated container prices down but paper prices up=no recovery

if the prices of boxes to sell goods inside of is down while paper is up, there is no recovery, because it means there is nothing to put in the boxes, because no one is making anything because no one is buying anything


when we get an actual recovery, the prices of the containers will rise as paper costs fall

its the only metric you truly need to watch

the prices are falling as the container company's battle over the small remaining volume of containers to be sold

the big manufacturers thrive on volume, pure and simple

no volume=no profit at any price

Schmuck Raker's picture


Art Cashin touched on this subject a few days ago:

[January 2011: -339k, January 2010: -427k, January2009: -356k, January 2008: -378k, January2007: -175k.]

KingPin 999's picture

Thanks Schmuck Raker, and this years number is consistent with those. However, the post revision adjustment is now made quarterly instead of annually. Therefore, the number could be seen as 4 times larger than the average quoted in the Art Cashin article. Wouldn't surprise me, this way they can get away with fudging the numbers 4 times more than they have in the past.

SeverinSlade's picture

The reelction strategy for TOTUS.

Declining UI (thanks to the plunging labor participation rate) + war with Iran (which will be blamed for the exploding price of crude which will, in turn, be blamed for economic weakness) = 2nd term

TruthInSunshine's picture

LOLstatistic of the day:

Wow. But Is the Number Real? 

February 3, 2012, 10:13 am


How many jobs did the American economy add in January?


The Labor Department estimated on Friday that the economy gained 243,000 jobs.


The department also estimated that the economy lost 2,689,000 jobs in the month.

The difference in the two numbers is in seasonal adjustment. Employment always falls in January, as temporary Christmas jobs end. So the government applies seasonal adjustment factors in an effort to discern the real trend of the economy apart from seasonal fluctuations. The actual survey showed the big loss in jobs. The seasonal adjustments produced the reported gain of 243,000 jobs.

A reason to doubt the number is that there has been a tendency in this cycle for the seasonal factors to overstate moves, in both directions. Labor mobility is down, as fewer workers quit to seek better jobs and employers both hire and fire fewer people than they used to do. If the seasonal adjustment was too large, then the gain should be smaller.


LOLstatistics Moment of the Day, sponsored by JP Morgan.

JP Morgan™ reminds everyone to eat their peas.

A Man without Qualities's picture

The fix is in, and there's no point trying to fight it...

Boilermaker's picture

Exactly, they are going to run this SOB all the way to the bitter ass end.  There is no f'ing way they are going to let up on this shit.  They're way way too far down the path to stop now.  It's all or nothin'.

emsolý's picture

It just means that banker layoffs are good for the economy and employment. Or something.

RobotTrader's picture

Jim Sinclair, Greg Hunter, Jim Willie, Martin Weiss, Gerald Celente


All turned into utter fools today.

For 3 years running all we have heard is:

"This Is It!"

"Any Minute Now, I Swear!!"..........


francis_sawyer's picture

So I suppose the lesson in all of this is...

When handed LEMONS... you make... YOGA OUTFITS?

johnQpublic's picture

he was handed bananas...

furiously producing monkeys as we speak

SeverinSlade's picture

Let's review what it takes to keep this ponzi going.

Trillions by the Fed

Constant blatant lies by the MSM propaganda whores

Constant fabrication of "official" government economic statistics (which includes constant upward revisions in UI, lower revisions in NFP)

Yep, the US economy is doing quite well.

Careless Whisper's picture

Seems to me you were calling a screaming Buy on Abercrombie (ANF) around $65 back in September, so maybe a little humility is in order.


Al Huxley's picture

Really? Gold down 1.2% in a completely typical reflex reaction to jobs numbers, after beating everything except silver in January, not to mention for pretty much all of the last 11 years and this makes the guys who've been more-or-less on the right side of the market for pretty much the last decade fools?

prains's picture


Boilermaker's picture

Double Down

Triple Down

Quadruple Down

Quintuple Down

Whatever this shit is

catacl1sm's picture

THANK GOD! Those corrugated boxes were getting mighty expensive! I was about to start buying eggs using an easter basket.

sabra1's picture

those cartons are the new luggage! if you can get hold of a fridge box, cover it in plastic wrap, voila, a new home!

Al Huxley's picture

Exactly. Based on this, the MSM spin should be 'new housing gets more affordable'.

Dr. Engali's picture

Well the economy is in great shape. No need for QE3 Right? Shouldn't a prudent Fed be raising rates right about now? What was I thinking......Prudent Fed...isn't that an oxymoron? How can an illegal entity be prudent?

hedgeless_horseman's picture


Exactly.  Watch what they do, not what they say.

gjp's picture

It really is incredible.  Commodities down, gold down, US dollar up, and stocks soaring.  Correlations only work when it implies stocks are up.  The one constant, stocks up.  What's the biggest intraday drop so far this year as the market has gone up 10%?  Probably about 1%, which was quickly erased within the day ...

As Robo says, this is central banker / bankster nirvana.  They must all be patting themselves smugly on the back right now.  But hubris (and wildly reckless and unjust policies) always meet their nemesis.  Don't they?  How much more do they need to tempt the gods before lightening comes?

This phase will only end when a lower dollar actually is not seen as good for stocks.  In that sense, today's break in correlation (stocks up, dollar up) may be a prerequisite.

I don't know, I don't want our world turned upside down, and that will surely be the result of the final denoument, but I can't stand watching today's 'leadership' and elite rewarded for epicly bad behavior.

SeverinSlade's picture

The take for your post is:

These criminal bankster thugs can only play God for so long until God royally fucks everything they're doing up.

Raymond Reason's picture

gjp....Great Post!!  "But hubris (and wildly reckless and unjust policies) always meet their nemesis."  Always, always.  Anyone who's lived on Earth for any length of time knows this all too well.  It's like a couple of mice teasing a cobra, patting themselves on the back, smirking... while the cobra just stares.   And the onlookers turn their heads away in mortification.  This will end so badly...particularly for the exalted American culture.    

Kali's picture

I guess my friend contributed to the uptick.  Called me last night, finally landed a job after 2 years.  Part-time, half the former pay.  Still qualifies for food stamps.  Yippee!  We are saved!

bania's picture

banking isn't a real job.

third world's picture

this manipulation seems like a china/argentilization of US ... sad, very sad ... so why should we buy s&p ate 13,5x PE (not considering the the revisions that will bring eps12 to around us90, meaning almost 10% decrease in earnings) ... oh QE/LTRO again??? just beacuse that??, it wont't let the world go to a recesson but just for a while, or maybe US will rebound to a 3,5% gdp growth, give me a break ... risk/reward more clear than ever is to sell it ... just be aware to not die in the beach, so pacient and controll the size of the bet ...

johnjkiii's picture

Corrogated cartons is a leading indicator of economic growth. No sellie, no shippie, no need boxie. Gold is down too. When funny money sloshes around lots of things get wet.

ElvisDog's picture

I like how they mention things like "crab". WTF? I didn't realize that crab was one of the linchpins of our non-ISM economy.

RobotTrader's picture

SPY now making new  highs in British Pounds, Euros, and Canadian Dollars.


A huge global bull market is underway for U.S. equities.,spy:FXY,spy:...|D

Reese Bobby's picture

How about in Gold?  Still new highs deep-thinker?

The trend is your friend's picture

One big coordinated clusterf**k.  in the words Bob Marley....Don't Worry, About a thing...cuz every little gonna be all right

Yen Cross's picture

 I think " corregated popout cartoons", is more apropo in that inflation info. Nice work Tyler.

fonzannoon's picture

I can't wait to see what happens to the 30yr when the twist ends. Oh wait....QE3.

dcb's picture

for those that use speed line analysis, we have hit the target now at 10:52 am today friday