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Daniel_Plainview wrote:We still have ZIRP ... we still have annual deficits of $1.6 trillion (above and beyond Obozo's initial stimulus), which is 11% of GDP ... and this repeats year after year under Obimbo ... plus countless other Obozo programs, payroll tax breaks, food-stamps, yada yada ...
Daniel_Plainview wrote:OilFinder2 wrote:Last quarter we had 2.5% GDP growth with ...
-- No QE. And Operation Twist had yet to be implemented.
-- Obama's stimulus money - which was passed all the way back in February of 2009 - was all but spent up. AFAIK it's *entirely* spent up, or darn close to it.
The largest contributors to GDP growth were purchases of services and business investment in equipment and software.
How the hell is that propped up by Obama? You're just so politically obsessed you're loathe to admit the economy might be recovering with him in office. So you make up excuses as to why the economy isn't recovering, and invoke Obama however you can.
We still have ZIRP ... we still have annual deficits of $1.6 trillion (above and beyond Obozo's initial stimulus), which is 11% of GDP ... and this repeats year after year under Obimbo ... plus countless other Obozo programs, payroll tax breaks, food-stamps, yada yada ...
OilFinder2 wrote:Oh - here goes the POMO conspiracy theory again.
Let's analyse this ...
First of all ... When stocks do well, bonds don't do well. And vice-versa. Hope there's no disagreement on that.
Second ... POMO operations mostly involve the Fed purchasing Treasuries (sometimes Agencies). When you've got an extra (and large) buyer of something, that's going to support the price. Hope there's no disagreement on that, either.
It follows from the Second -- if the Fed purchases some Treasuries on some given date ... Which leads to the First -- that is, the Fed is supporting the bond market by purchasing Treasuries ... then the stock market should go down, not up. Because, after all, when bonds do well (as they should on POMO days), stocks don't.
The conspiracy theory usually then goes that the Fed is buying Treasuries from banks or other institutions ("open market" operations) so that frees up cash these institutions can invest in the stock market. But if that were the case, we'd see both the bond *and* stock markets go up on POMO days. But, as anyone who follows the market knows, that almost never happens.
As for the dollar, anyone who follows the markets also knows that, when the bond market tanks, the dollar goes down, and vice-versa. So, the Fed's POMO operations, by buying Treasuries and supporting the bond market, should send the dollar up, not down.
Conspiracy theory debunked.
I’ll be honest with the reader. When I ran this data I was really hoping that I would find evidence showing that the POMO’s have no impact on market direction. The conclusion is unsettling for obvious reasons. And while this might be nothing more than a case of datamining the evidence is convincing that the Federal Reserve is helping to boost equity prices without creating an equally positive change in SUSTAINABLE economic growth. I’m not a conspiracy theorist, but when I’ve got the Manager of the System Open Market Account for the Federal Open Market Committee telling me that he wants to keep “prices higher than they otherwise would be” combined with this evidence it makes it very hard to believe that the Fed isn’t attempting to outdo Bernie Madoff.
UNEMPLOYMENT INSURANCE WEEKLY CLAIMS REPORT
SEASONALLY ADJUSTED DATA
In the week ending January 7, the advance figure for seasonally adjusted initial claims was 399,000, an increase of 24,000 from the previous week's revised figure of 375,000. The 4-week moving average was 381,750, an increase of 7,750 from the previous week's revised average of 374,000.
The advance seasonally adjusted insured unemployment rate was 2.9 percent for the week ending December 31, unchanged from the prior week's revised rate.
The advance number for seasonally adjusted insured unemployment during the week ending December 31, was 3,628,000, an increase of 19,000 from the preceding week's revised level of 3,609,000. The 4-week moving average was 3,605,000, unchanged from the preceding week's revised average.
The advance number of actual initial claims under state programs, unadjusted, totaled 642,381 in the week ending January 7, an increase of 102,314 from the previous week. There were 773,499 initial claims in the comparable week in 2011.
The advance unadjusted insured unemployment rate was 3.3 percent during the week ending December 31, an increase of 0.3 percentage point from the prior week's unrevised rate. The advance unadjusted number for persons claiming UI benefits in state programs totaled 4,139,988, an increase of 360,884 from the preceding week. A year earlier, the rate was 3.8 percent and the volume was 4,790,155.
The total number of people claiming benefits in all programs for the week ending December 24 was 7,333,213, an increase of 111,010 from the previous week.
Today's release of weekly initial jobless claims came in at a seasonally adjusted 399K, which was more than the expected 375K and the highest level seen since the end of November. In recent weeks, there has been a lot of attention (or at least more than usual) placed on the non-seasonally adjusted (NSA) readings. This morning was no different as some are pointing to the 102K increase and calling it an alarming signal.
So how worried should we be about it? As of now, not much. The chart below shows weekly initial jobless claims on a NSA basis. Even after this week's reportedly big jump, for the first week of January (red dots), initial claims have not been this low since January 2008. Additionally, compared to recent years, this week's increase of 102K is actually a lot less than the prior three years where NSA claims rose by between 175K and 225K.
Pops wrote:Cross-posting is a specific no-no.
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