Here Comes The Double Dip Pt. 3

[OilFinder2]

CareerBuilder: Hiring plans getting back to pre-recession levels

Hiring plans are getting back to pre-recession levels, according to CareerBuilder’s latest nationwide survey.

During the first quarter of this year, one-third of employers added full-time permanent employees, which is on par with 2007 and the highest increase reported since the recession began.

That momentum is expected to continue with 30 percent of employers planning to hire new, full-time permanent staff between now and June.

The national survey was conducted by Harris Interactive between Feb. 9 and March 2 among more than 2,000 hiring managers and human resource professionals across industries and company sizes.

[...]

[OilFinder2]

Consumer Confidence Climbs as U.S. Job Market Improves

Consumer confidence climbed last week to the highest level in four years and unemployment claims fell, pointing to a brighter job market that may invigorate the U.S. economy.

The Bloomberg Consumer Comfort Index rose to minus 31.4 in the period ended April 1, the best reading since March 2008, from minus 34.7 the prior week. Filings for jobless benefits dropped by 6,000 to 357,000 in the week ended March 31, the fewest since April 2008, the Labor Department said.

Employers probably took on more than 700,000 workers in the first three months of this year, the best quarter for job growth since 2006, a report tomorrow may show, while equities rallied the most since 1998. The improvements may support consumer spending in the face of rising gasoline prices.

“There’s a gradual acceleration underway in the economy,” said Michael Englund, chief economist at Action Economics LLC in Boulder, Colorado, and the second-most accurate forecaster of unemployment applications. “Today’s claims data and confidence reading put a positive spin going into tomorrow’s payroll report,” he said, projecting 210,000 jobs were created in March.

[...]

[OilFinder2]

This is interesting - Gallup has decided to start seasonally adjusting its unemployment poll. Though, as they note at the bottom of the page, there are still big differences with the BLS's methodology.

U.S. Unemployment Declines in March

PRINCETON, NJ -- U.S. unemployment, as measured by Gallup without seasonal adjustment, declined to 8.4% in March from 9.1% in February, while Gallup's seasonally adjusted rate fell to 8.1% from 8.6% in February.



These results are based on Gallup Daily tracking interviewing conducted in March, including interviews with 31,283 U.S. adults, 67.8% of whom are active in the workforce. Gallup's seasonally adjusted unemployment rate is based on the adjustment used by the Bureau of Labor Statistics in the same month of the previous year.

On an unadjusted basis, the March unemployment rate matches the previous low since Gallup began monitoring and reporting unemployment in January 2010. The unadjusted unemployment rate was last at 8.4% in October and November 2011. On a seasonally adjusted basis, March's 8.1% reading is near the monthly low of 7.9% for Gallup's U.S. unemployment rate, seen in January of this year. In both cases, Gallup trends show the U.S. unemployment rate declining dramatically over the past year.

[...]

In this chart they compare their seasonal adjustment with the BLS. Their method has a lot more ups and downs, but generally follows the BLS.

[Daniel_Plainview]

Egan-Jones Cuts US Credit Rating to 'AA,' Citing Debt

Rating firm Egan-Jones cuts its credit rating on the U.S. government to "AA" from "AA+" with a negative watch, citing a lack of progress in cutting the mounting federal debt. "When debt-to-GDP exceeds 100 percent, a country's financial flexibility becomes increasingly strained," Managing Director Sean Egan wrote in his report on the downgrade. "For the first time since World War II, U.S. debt exceeds 100 percent." The U.S. dollar fell slightly against the yen after the news, which came at the start of Asia's trading day.

Egan said he sees no end in sight to the increasing deficit. "With an annual federal budget deficit in the area of $1.4 trillion, debt is likely to reach $16.7 trillion as of the end of 2012 while assuming GDP grows 2.5 percent, total GDP is likely to reach $15.7 trillion. Therefore, as of the end of 2012, debt-to-GDP is likely to be in the area of 106 percent."

Economic growth, meanwhile, has averaged 2 percent to 2.5 percent, with economic growth "at best stagnant, at worst negative" if adjusted for inflation, Egan wrote.

Meanwhile, Congress has done little, according to Egan. The bipartisan "super committee" that sought spending cuts of $1.5 trillion over 10 years "was a failure," he said. "Obviously, the current course is not enhancing credit quality. Without some structural changes soon, restoring credit quality will become increasingly difficult."

[Daniel_Plainview]

Next Great Depression? MIT study predicting ‘global economic collapse’ by 2030 still on track

A renowned Australian research scientist says a study from researchers at MIT claiming the world could suffer from a "global economic collapse" and "precipitous population decline" if people continue to consume the world's resources at the current pace is still on track, nearly 40 years after it was first produced.

The Smithsonian Magazine writes that Australian physicist Graham Turner says "the world is on track for disaster" and that current research from Turner coincides with a famous, and in some quarters, infamous, academic report from 1972 entitled, "The Limits to Growth." Turner's research is not affiliated with MIT or The Club for Rome.

Produced for a group called The Club of Rome, the study's researchers created a computing model to forecast different scenarios based on the current models of population growth and global resource consumption. The study also took into account different levels of agricultural productivity, birth control and environmental protection efforts. Twelve million copies of the report were produced and distributed in 37 different languages.

Most of the computer scenarios found population and economic growth continuing at a steady rate until about 2030. But without "drastic measures for environmental protection," the scenarios predict the likelihood of a population and economic crash. However, the study said "unlimited economic growth" is still possible if world governments enact policies and invest in green technologies that help limit the expansion of our ecological footprint.

The Smithsonian notes that several experts strongly objected to "The Limit of Growth's" findings, including the late Yale economist Henry Wallich, who for 12 years served as a governor of the Federal Research Board and was its chief international economics expert. At the time, Wallich said attempting to regulate economic growth would be equal to "consigning billions to permanent poverty."

Turner says that perhaps the most startling find from the study is that the results of the computer scenarios were nearly identical to those predicted in similar computer scenarios used as the basis for "The Limits to Growth."

"There is a very clear warning bell being rung here," Turner said. "We are not on a sustainable trajectory."

[Daniel_Plainview]

114 banks are on review-for-downgrade, raising funding costs (and liquidity concerns) even further

A major potential negative catalyst for financials globally is rapidly approaching as 114 banks are on review-for-downgrade by Moody's across 16 countries. ... A downgrade could also force the bank to provide additional collateral to back its vast derivatives business - where it acts as one of the largest counterparties. In Europe, the fun heats up in the next few weeks as first Italian banks (4/16), then Spanish banks (4/23) and then Austrian (4/30) face from 1 to 4 notch downgrades and the potential to lose their short-term (funding-/CP-related) Prime-1 top rating, implicitly raising funding costs (and liquidity concerns) even further.

[AgentR11]

Economic growth, meanwhile, has averaged 2 percent to 2.5 percent, with economic growth "at best stagnant, at worst negative" if adjusted for inflation, Egan wrote.

Its not just me spitballing this stuff; these are serious people noting the divergence between official growth and actual growth with real inflation accounted for. "stagnant". If it weren't for the total debt growing quicker than the numerical valuation of the economy, we'd honestly be in decent shape. As it is, I think this money is going out, getting spent just a few times and then landing in an account of someone that is a tad petrified of where we might be headed and thus unwilling to spend it again. Thus, the debt is growing faster than the manipulated economy.

As to ratings.. pretty irrelevant as long as the Fed is backstopping against high interest rates.

[Daniel_Plainview]

Its not just me spitballing this stuff; these are serious people noting the divergence between official growth and actual growth with real inflation accounted for. "stagnant". If it weren't for the total debt growing quicker than the numerical valuation of the economy, we'd honestly be in decent shape. As it is, I think this money is going out, getting spent just a few times and then landing in an account of someone that is a tad petrified of where we might be headed and thus unwilling to spend it again. Thus, the debt is growing faster than the manipulated economy.

Another important point is that the US "growth" figure (i.e., "GDP") is artificially inflated by at least 10% based on govt deficit spending. Denninger agrees:

About one out of every 10 dollars spent in the economy (that is, GDP) is money borrowed by the federal government and then spent. This creates an artificial level of demand in the economy and allows the government to claim that "we're growing!" But we in fact are not. In point of fact all we're doing is inflating the debt bubble, just as we have for 30 years.

This chart is, very simply, the change in total systemic debt (from the Fed Z1) compared against the change in GDP. We get both numbers quarterly; one from the Fed and the other from the BEA.



Since all money is debt in modern monetary systems each new dollar spent into the economy must come with a debit somewhere (that is, it is someone's obligation.) This means that we can very easily measure the total amount of monetary inflation -- or deflation -- by simply comparing those two figures.

The "fear factor" for Bernanke and Congress is that the deceptive practices of the last 30 years will be discovered for what they are. The so-called "prosperity" since 1980 has mostly been a scam -- it has been nothing more than monetary inflation coupled with frauds that allowed people to borrow money they couldn't pay. Under this cover all manner of sin was committed; two bubbles (Internet and Housing) along with the theft of every single dime paid into Social Security and Medicare.

It is not "deflation" to take that monstrous bubble from 1981 forward and let the air out of it. That would be nothing more than restoring balance, but it would not come "nicely."

So instead we have pretended. To be blunt, we all lied. To ourselves, to each other, and the government lied to all of us. We see articles telling us that we "can't" make "irresponsible cuts" to government spending but what was irresponsible was promising to spend money we didn't have in the first place.

There is no cheap, easy or clean way out of this box. We will have to, at some point, accept the monetary, fiscal and economic contraction that must come to restore balance.

The US "growth"/GDP figure is also artificially inflated via a blatantly dishonest GDP multiplier, which assumes a preposterously low inflation rate of between 0.1% and 0.4%.

So the govt's GDP data should be added to the list of blatantly dishonest US govt figures.

[OilFinder2]

You know things are going pretty well when the jobs report says 120K jobs were added in March - which would have been around a consensus figure just 6 months ago - but everyone is disappointed.

There could have been something to that warm weather phenomenon lots of people were mentioning, since retail trade was the only sector which lost large numbers of jobs. Those people were probably hired in January and February instead of the usual March.

BLS
- Manufacturing had a nice gain of 37K.
- Food services and drinking places gained 37K.
- Health care gained 26K.
- Professional and business services gained 31K. That was actually kinda disappointing too, even though it was a gain.
- Retail trade fell by 34K.
- Mostly small changes in other sectors.

February revised up from 227K to 240K, January revised down from 284K to 275K.

U.S. economy gains 120,000 jobs in March: Less-than-expected increase is smallest since last fall

The U.S. economy added 120,000 jobs in March, the smallest increase in five months, to break a recent string of strong employment gains, the government reported Friday.

The number of jobs created last month fell well below expectations and failed to top the 200,000 mark for the first time since November.

Economists surveyed by MarketWatch expected a 210,000 increase.

Some economists had cautioned that employment gains in March could end up lower because of unseasonably warm winter weather. Companies kept workers on or hired people in January and February who otherwise would have been added in March or April.

These changes in hiring patterns may not have been captured by the government’s efforts to adjust for seasonal factors.

“In recent months, concerns had been raised that seasonal adjustments had been overstating reported job creation,” said Jim Baird, chief investment strategist at Plante Moran Financial Advisors. “Today’s report suggests those concerns may have been legitimate."

[...]

Disappointing, but not a disaster. We'll have to see what happens the next couple months.

[OilFinder2]

There could have been something to that warm weather phenomenon lots of people were mentioning, since retail trade was the only sector which lost large numbers of jobs. Those people were probably hired in January and February instead of the usual March.

I just discovered retail lost 29K jobs in February, too. Oh well, at least you can't say all the jobs being created are Wal-Mart jobs.

[Plantagenet]

We've seen this before. In 2009-10 and 2010-11---- the economy started to pick up and then in the spring the economy slowed down again.

Who could ever forget the Obama administration boasting about the green shoots of 2010? Or predicting a "recovery summer" in 2011. Then the green shoots died and the recovery summer failed to recover.

We're seeing the same thing again in 2012. It doesn't help that this time around obama has foolishly caused a spike in the global price of oil through his sanctions on Iranian oil exports. And as far as "all the jobs created"---it still isn't keeping pace with population growth so the end result, month after month, continues to be increases in the huge and unprecedented numbers of "discouraged" (i.e. long term unemployed) workers.

[Lore]

We've seen this before. In 2009-10 and 2010-11---- the economy started to pick up and then in the spring the economy slowed down again.

Who could ever forget the Obama administration boasting about the green shoots of 2010? Or predicting a "recovery summer" in 2011. Then the green shoots died and the recovery summer failed to recover.

We're seeing the same thing again in 2012. It doesn't help that this time around obama has foolishly caused a spike in the global price of oil through his sanctions on Iranian oil exports.

I'm sure an all out Iranian war would really be so much better for gas prices then just trying sanctions.

[Plantagenet]

I'm sure an all out Iranian war would really be so much better for gas prices then just trying sanctions.

I'm sure you are wrong on that one. Obama's sanction regime has boosted oil up to ca. 120-125/barrel----a war would take it much higher.

[Lore]

I'm sure an all out Iranian war would really be so much better for gas prices then just trying sanctions.

I'm sure you are wrong on that one. Obama's sanction regime has boosted oil up to ca. 120-125/barrel----a war would take it much higher.

That is exactly what I meant. You missed the sarcasm.

[Plantagenet]

You missed the sarcasm.

No I didn't. My reply was both droll AND sarcastic about your idea that a war with Iran would be great for oil prices.



OK..., lets get back to the actual topic under discussion in this thread, if you don't mind.

The world oil price has been boosted by Obama's sanctions and saber-rattling over Iran. Something similar happened last spring, when Obama started bombing Libya. The higher oil prices in the spring of 2011 helped stymy the 2011 momentum towards recovery....and now the surprisingly bad jobs numbers just seen seen for March suggest that something similar may be happening in 2012 as high oil prices return once again.

[Lore]

You missed the sarcasm.

No I didn't. My reply was both droll AND sarcastic about your idea that a war with Iran would be great for oil prices.



OK..., lets get back to the actual topic under discussion in this thread, if you don't mind.

The world oil price has been boosted by Obama's sanctions and saber-rattling over Iran. Something similar happened last spring, when Obama started bombing Libya. The higher oil prices in the spring of 2011 helped stymy the 2011 momentum towards recovery....and now the surprisingly bad jobs numbers just seen seen for March suggest that something similar may be happening in 2012 as high oil prices return once again.

And your alternative is exactly what?

[Plantagenet]

The world oil price has been boosted by Obama's sanctions and saber-rattling over Iran. Something similar happened last spring, when Obama started bombing Libya. The higher oil prices in the spring of 2011 helped stymy the 2011 momentum towards recovery....and now the surprisingly bad jobs numbers just seen seen for March suggest that something similar may be happening in 2012 as high oil prices return once again.

And your alternative is exactly what?

If we had a smarter president than Obama, we wouldn't be stuck in this ridiculous situation where Bernanke is printing dollars as fast as he can to stimulate the economy until the economy starts gaining traction, but then BO does something boneheaded like bombing Libya or saber-ratting with Iran that causes oil prices to go up and the economy to go through another long cycle of slowing down.


Of course I suppose I shouldn't be surprised that obama doesn't understand things like peak Oil and how wars in the Middle East cause the price of oil to rise and economic activity to slow. After all---Obama is such a dope that he doesn't even understand that the US Supreme Court ----even though unelected----is empowered by the US Constitution to declare all or parts of laws unconstitutional.

[Cog]

We are starting to see that 6 month lag between sustained +100/bbl oil and a slow-down in the economy. If prices stay up, expect the downturn to get a lot worse.

[ralfy]

"NFP Big Miss: 120K, Expectations 205K, Unemployment 8.2%, "Not In Labor Force" At New All Time High"

http://www.zerohedge.com/news/nfp-big-m ... loyment-82

[Lore]

If we had a smarter president than Obama, we wouldn't be stuck in this ridiculous situation where Bernanke is printing dollars as fast as he can to stimulate the economy until the economy starts gaining traction, but then BO does something boneheaded like bombing Libya or saber-ratting with Iran that causes oil prices to go up and the economy to go through another long cycle of slowing down.

And who would that smarter President then Obama be? Obama doesn't control Bernanke.

I would suggest Obama understands PO quite well, as did several previous Presidents.