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U.S. Jobs, Debt Ceiling, Retail Sales, and the Yuan
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February 5, 2010
Good Morning:
U.S. Jobs, Debt Ceiling, Retail Sales, and the Yuan
U.S. Jobless Claims/January
Job Losses
The Dow fell yesterday by 268 points to 10,002, ostensibly in part on the announcement of U.S. Job Claims last
week increased by 8,000 to 480,000 - against economist expectations of 458,000.
This morning the U.S. Labor Department reported January U.S. Job loss numbers and
the unemployment rate as 20,000 and 9.75% respectively. The median projection
was reported as having been a net gain of 15,000 non-farm payroll jobs, with forecasts
ranging from +/- 100,000 jobs gained or lost. Analysts had forecast an unemployment rate of 10.0%.
At 10:25 a.m ET this morning the Dow was off a further 9 points. I can't make
sense of the reported unemployment rate. How can job losses increase and the
unemployment rate decrease. The answer may well be that more people in the
U.S. have stopped looking for jobs, and hence are not counted in the statistic.
If that is the case, then it I seems to me 'Main Street U.S.A.' very likely is in
a worse economic condition than the reported unemployment statistic implies.
This news of ongoing U.S. Job Losses does nothing in my view but reconfimr the fragility
of the 'so-called' U.S. economic recovery - and continues to cause me to find a
disconnect between those who continually claim ongoing recovery when I think the
'Main Street' numbers dictate otherwise.
Congress Raises Spending Limit
It was
reported the U.S. House of Representatives yesterday voted 233-187 to approve
new restrictions on future spending and tax cuts, and an increase in the U.S. National
Debt 'ceiling' to $14.3 trillion. Do the math. 44.5% of the 420 Congressmen
and women voted against the spending restrictions. Think about that hard.
How is it possible that almost half of those that voted must - for whatever their
reasons - believe it is either in their constituents long-term best interest for
them to have voted 'no', or believe the U.S. Federal Government is beyond having
to balance its budgets and will not ultimately have to 'pay the piper'. Think
of the best downhill ski racer in the world deciding he/she can't fall and is immortal
jumping off the top of Mount Everest and proceeding downhill at ever increasing
speeds. The end result - he/she will be proven wrong about their immorality
long before they get back to their Sherpa base camp.
China Currency
An article today reports U.S. Treasury Secretary Geithner said yesterday that China
is likely to let the yuan increase against the U.S.$, which could help U.S. exports
and create U.S. jobs. I think Geithner is 'dreaming in technicolor'
I suggest you take the time to read the story by clicking here. Unless China goes against
what I see as human nature, I can't imagine why it would increase the yuan exchange
rate unless it thought it was to its own economic advantage to do so - and I can't
see why it would be.
U.S. Latest Quarter Same Store Sales Numbers
An article this morning summarizes latest quarter year/year 'same store sales numbers
for 14 U.S. publicly listed retail and food chains, and January/January 'same store
sales for 24 such chains'. The quarterly results show 8 decliners and 6 gainers,
while the January results show 7 decliners and 17 gainers.
The article reaches no conclusion. This is not surprising, given that no 'weighted
averages' are reported, and that there is a wide range of 'product lines' represented
in the 38 'same store' reports. In my view, all one can reasonable conclude
is that there is no discernable upward or downward trend - and even that has to
be seen as tenuous conclusion. Click here if you have an interest in reviewing
the article and its specific data.
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