60 Minutes on the Explosion of Disability Enrollees

60 Minutes this past Sunday did a piece on a story that has been talked about in these pages for a long time – the rapid increase in disability enrollment since the recession half a decade ago.  It is quite remarkable that effectively 5% of the working population is now enrolled. [Apr 7, 2011: Nearly 1 in 20 Working Age Americans Are on Disability, a Doubling Versus 1990]  [Dec…

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WSJ's Hilsenrath on Janet Yellen

With the demise of Larry Summers, all eyes point to Janet Yellen as the next Federal Reserve head.  Frankly it is a bit surprising she was not the leading candidate all along.   Earlier this year, we posted a NY Times piece on the woman [Apr 25, 2013: NY Times Does Janet Yellen] from a more personal level and now we have one on the Fed whisperer himself, Jon Hilsenrath…

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The Most Overbought Point in 2013

Quite an explosive rally yesterday at the 2 PM mark, in fact about 70% of yesterday's gains came in a minute or so per Bespoke Investment; the power of algos.   Obviously the Fed, by surprising just about everyone with "no taper at all", lit another fire under the market but coming off a near vertical rally since late August it is still a bit surprising to see the…

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Mar09

Being the weak sister of the market the past 6 weeks I am watching the Russell 2000 a bit more than the S&P 500 right now.  It broke the 50 day moving average during Tuesday's slash and burn but has staged a dramatic bounce since.  Most of February it sat in the 810-830 range while the larger cap indexes advanced, and today's move has it regaining the lower end of that range.   We'll see if it can keep that level on a closing basis but once again you have to applaud the move from oversold levels.  

Disclosure Notice

Any securities mentioned on this page are not held by the author in his personal portfolio.

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Mar09

February's job growth numbers came in more or less in line with expectations at 227,000 and an 8.3% rate.  Private sector gains of 233,000 vs a 6,000 loss in government.   January was revised up nicely to 284,000 vs 243,000.  Full report here.

Average hourly earnings +0.1%, a bit light versus expectations of 0.2% – but one could say that is good news for those who want more monetary easing.  This figure is up 1.9% year over year so no cost push inflation coming from this avenue which would be one thing the Fed might actually consider if it ramped up.

Average workweek unchanged at 34.5 hours.

U-6 (marginally attached + unemployed) down to 14.9%

Disclosure Notice

Any securities mentioned on this page are not held by the author in his personal portfolio.

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Mar08

The monthly consumer credit data is always an interesting data point.  Both bulls and bears could look at the same data point and come to completely different conclusions.  Yesterday's report saw a massive increase in consumer credit, far in advance of expectations.  Those on the bull side of the economy will (and did) say that consumers are feeling more comfortable with the economy, hence are apt to access their credit lines.  Those on the bear side will (and did) say that consumers are in relative desperation mode, tapping credit as their wages are not keeping up with expenses.  No one ever knows the exact truth, and I'm sure in a country of hundreds of millions of consumers, some people fall into both bucket.

Disclosure Notice

Any securities mentioned on this page are not held by the author in his personal portfolio.

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Mar08

After giving up all of the gap up this morning, the Russell 2000 has impressively turned and put on a 1% gain.  While not yet into the February range of 810 to 830, the turnaround is notable.  The market has been back on hyper speed since the WSJ leak of potential "sterilized" QE yesterday 11 AMish.   We are now back to Monday's close on the S&P 500 and Tuesday has been completely erased.  You have to tip your hat at that.  We now see the S&P 500 about 13 points away from highs of the year reached last week, and as it stands mid afternoon has poked its head back over the 10 day moving average….. from where this index has run almost the entire year of 2012.  The light volume, V shaped moves of the past few years continue.

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Any securities mentioned on this page are not held by the author in his personal portfolio.

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Mar08

While in theory central bank balance sheets could go to infinity (which of course would destroy a currency), the massive growth we've seen on global central banks assets as a % of GDP in the past 5 years is quite awe inspiring.  How they are ever going to unwind these measures down the road is going to be one neat trick.  For now, it is just an epic kick the can and partial monetization of debt (as shorer duration bonds hit maturity and go poof into the night)

The WSJ takes a look at the massive expansion – believe it not since Draghi [Feb 9, 2012: 100 Days of Mario Draghi]  came to town he has actually pushed the ECB's balance sheet (as a % of the region's GDP) to the highest level among the West's major central banks.

Disclosure Notice

Any securities mentioned on this page are not held by the author in his personal portfolio.

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