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Friday, November 08, 2013 – Jobs, Jobs, Jobs Friday

Jobs, Jobs, Jobs Friday by Sinclair Noe DOW + 167 = 15,761SPX + 23 = 1770NAS + 61 = 391910 YR YLD + .14 = 2.74%OIL + .13 = 94.33GOLD – 19.10 = 1289.50SILV – .17 = 21.60 Another record high close for the Dow. For the week, the Dow rose 0.9 percent, the S&P 500 was up 0.5 percent while the Nasdaq was down 0.1 percent. Today was all about jobs. The Bureau of Labor Statistics reported that total nonfarm payroll employment rose by 204,000 in October and the unemployment rate increased from 7.2% to 7.3%. The 204,000 new jobs was much better than the estimates of about 120,000. Further, the numbers from previous months were revised higher; September was revised from 148,000 new jobs to 163,000 new jobs, and August was revised from 193,000 jobs up to 238,000; for a net gain of 60,000 upwardly revised jobs. So, why did the unemployment rate move higher? Part of this may have to do with the government shutdown and there might be a reversal in the November numbers. The furloughed government workers, at least some, were likely counted as unemployed with regard to the unemployment rate, but for the total number, that 204,000 number, those furloughed workers were not counted as unemployed. The problem with the unemployment rate is that the rate can fall even when the labor market conditions get worse. There are two possible reasons why the unemployment rate drops; either more jobless people find work, or more …

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Thursday, January 31, 2013 – Friedman, Von Mises, Adam Smith, and Inflation

Friedman, Von Mises, Adam Smith, and Inflation by Sinclair Noe DOW – 49 = 13,860SPX – 3 = 1498NAS – 0.18 = 314210 YR YLD – .02 = 1.99%OIL – .49 = 97.45GOLD – 12.90 = 1664.50SILV – .56 = 31.56 Let’s cover some of the economic news and then I’ll try to tackle one of the most pressing questions of our time. The Commerce Department reports personal incomes rose a seasonally adjusted 2.6% in December, the fastest pace in eight year. Sounds good, but the numbers are a bit of a fluke. Personal dividend income jumped 34.3% in December, pushed forward by concerns about the fiscal cliff. That is income that won’t be paid out on a regular schedule, so the big increase will be matched by a later decrease in dividend income. Excluding the dividends and other distortions, personal income rose 0.4% in December. Wages and salaries rose 0.6% in December after a 0.8% gain in November and were up 5.4% year-on-year. Consumer spending rose 0.2% in December, in line with expectations. With incomes running faster than spending, the personal savings rate rose to 6.5% of disposable income from 4.1% in November. It was the highest savings rate since May 2009. Initial jobless claims jumped 38,000 to a seasonally adjusted 368,000 in the week ended Jan. 26. A separate survey this week produced by the payroll processor ADP said the U.S. gained 192,000 private-sector jobs in January, the highest in nearly a year. The ADP report is not …

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Friday, December 7, 2012 – A Date Which Will Live in Infamy, Plus the Jobs Report

A Date Which Will Live in Infamy, Plus the Jobs Report by Sinclair Noe DOW + 81 = 13,155SPX + 4 = 1418 NAS – 11 = 297810 YR YLD +.05 = 1.63%OIL – .27 = 85.99 GOLD + 4.50 = 1704.50SILV + .08 = 33.11 Today marks the 71st anniversary of the attack on Pearl Harbor. There were of course, memorials in Hawaii and around the country. I’ve seen a few of the pictures. Each year the number of Pearl Harbor survivors that attend these memorials, their number grows smaller and their ranks thin. If you know a veteran of World War II, be sure to take time to recognize their stories, be sure to say thanks. Today’s major economic data was the monthly jobs report; widely expected to be weak due to the effects of Hurricane Sandy. Instead, it came in relatively strong. The headline numbers: the economy added 146,000 jobs in November, and the unemployment rate dropped to 7.7%, a four year low. The Labor Department claimed that the effect of Sandy on the report was minimal, saying in a statement, “Our analysis suggests that Hurricane Sandy did not substantively impact the national employment and unemployment estimates for November.” In other words, we should not look at this report as surprisingly good given the effect of the hurricane. Rather, the Labor Department claims that the jobs numbers should be analyzed without taking the storm into account at all. And by that standard, not only were the job …

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Wednesday, September 5, 2012 – Just Waiting and Being Productive

Just Waiting and Being Productive -by Sinclair Noe DOW + 11 = 13,047SPX – 1 = 1403NAS – 5 = 306910 YR YLD +.01 = 1.59%OIL +.44 = 97.72GOLD – 2.80 = 1694.40SILV – .09 = 32.37PLAT + 2.00 = 1577.00 We wait for the ECB and as we wait we try to remain productive.  Three months ago, George Soros said the powers that be in the euro-zone, which is another way of saying Germany, could still correct their mistakes and reverse the trend and make things right, and they had a three month window to get their act together. Soros delivered the speech on June 2nd. The European Central Bank meets tomorrow and there is a rumor floating around that that ECB President Mario Draghi is ready to announce a plan to buy unlimited sovereign debt of countries that formally request assistance and agree to be bound to fiscal compliance.  So far, it is just a rumor but we have seen Italian and Spanish bond yields have dropped sharply. The German Constitutional Court is ruling on whether the ESM is constitutional, and German manufacturing is contracting; so the timing presents some challenges. The German Finance Minister today said people should lower their expectations. I don’t know what that means. Maybe Draghi has managed to cobble a deal to allow unlimited bond purchases; we won’t know until Thursday night, Friday morning; if a deal is in place it is a big deal. If a deal is not announced, it won’t …

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Thursday, May 31, 2012 – Jobs and the Food Chain – by Sinclair Noe

DOW – 26 = 12393SPX – 2= 1310NAS – 10 = 282710 YR YLD -.04 = 1.58%OIL +.04 = 86.57GOLD – 2.30 = 1561.20SILV – .22 = 27.81PLAT +15.00 = 1421.00 The S&P 500 index fell 6.3 percent in May, its largest percentage drop since September. The Dow’s 6.2 percent drop and Nasdaq’s 7.2 percent loss are their largest monthly declines in two years. Crude oil futures prices finished May with losses of 17%, their worst drop (or best, depending on your position) since December 2008, near the height of the U.S. financial crisis. Gold ended May with its fourth straight monthly decline – about 6%, the most in 12 years, and only slighly better than the S&P500. The troubles in Europe sent investors looking for the safe haven of the dollar and the dollar index gained 5.4% in May. The Euro finished the month at $1.233, down 7%. The Spanish market index, the Ibex25 is down 13%, Japan’s Nikkei is off 10%, and the Russian RTS is down 22% in May. The 10-year US Treasury note returned 1.6% for the month as yields dropped to historic low. If you think the markets are starting to resemble Mr. Toad’s Wild Ride – you are correct. The VIX, the Volatility Index jumped 40%. We had a few economic reports, disappointing economic reports, however the big jobs report tomorrow will overshadow today’s news. The Commerce Department reports economy grew at an annual rate of 1.9 percent in the first three months of …

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March, Friday 09, 2012

DOW + 14 = 12,922SPX + 4 = 1370NAS + 17 = 298810 YR YLD +.02 = 2.04%OIL + .84 = 107.42GOLD + 14.00 = 1714.50SILV +.44 = 34.42PLAT + 22.00 = 1688.00 The S&P 500 managed to post a gain of 0.1% for the week; so, even with the big drop on Tuesday, the S&P notched its 4th consecutive weekly gain. This morning we got the monthly jobs report; the headline number showed the economy created a net 227,000 jobs in February. It is generally estimated that we need a job creation rate of 150,000 per month just to keep up with population growth, just to tread water. Now we’re finally getting that growth. February marked the third straight month in which payroll jobs rose by more than 200,000. Gains could be seen in a range of industries: professional and business services, manufacturing, and health care. The construction and retail trade sectors shed positions. Every month, when the Bureau of Labor Statistics reports the jobs figures, it revises the previous two months’ reports. Looking back, BLS has determined that more jobs were created in December 2011 and January 2012 than originally thought. The December jobs gain, originally reported as a 200,000 gain in January, was revised to 223,000. January’s job total, originally reported as a gain of 243,000, was revised upwards to 284,000. In other words, BLS discovered an extra 61,000 jobs. Compared with February 2011, 2.021 million more Americans have payroll jobs. In the past two years, the …

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February, Friday 3, 2012

DOW + 156= 12862SPX + 19 = 1344NAS + 45 = 290510 YR YLD +.12 = 1.95%OIL +1.44 = 97.80GOLD – 32.50 = 1726.90SILV -.69 = 33.77PLAT – 7.00 = 1626.00 The unemployment rate dropped to 8.3 percent in January. The economy added 243,000 jobs, the biggest monthly increase in nine months. The results were about 100,000 stronger than most estimates. Revisions added a total of 60,0000  jobs to payrolls in November and December. Gains in employment last month were broad-based, including manufacturing, construction, temporary help agencies, accounting firms, restaurants and retailers. Manufacturing payrolls increased by 50,000 in January, the most in a year. Construction companies added 21,000 workers last month. We talked about this about one month ago; the mild winter and warm weather across most of the country has really helped construction jobs.  Private payrolls, which exclude government agencies, rose 257,000 in January after a revised gain of 220,000 the prior month, marking the biggest back-to-back gain since March-April. Government payrolls decreased by 14,000 in January. If it weren’t for public sector cutbacks, the labor market would be looking even better. Average hourly earnings rose 0.2 percent to $23.29, today’s report showed. The average work week for all workers increased to 34.5 hours (from 34.4) The underemployment rate — which includes part- time workers who’d prefer a full-time position and people who want work but have given up looking — decreased to 15.1 percent from 15.2 percent. Whenever the unemployment rate drops, economically savvy observers know to ask …

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