Economic News

[Birchtree]

I won't ask how you managed to accomplish that feat.

 

[Spaf]

Sorry Oldcoin, I can't seem to use mouth-to-mouth on a worm....:toung:

I used to inflate my worms to make them float off the bottom of the lake. The fish seemed to love it

 

[Birchtree]

A bicycle pump would be my guess with a polish adapter of course. Or perhaps an empty syringe with attached needle would be most efficient.

 

[Spaf]

Birch,

U are going to be banned for CAW. Cruility Against Worms!...:laugh: Tell me this, if you look at a worm which end is the head and which end is the tail?

.......

A bicycle pump would be my guess with a polish adapter of course. Or perhaps an empty syringe with attached needle would be most efficient.

 

[Oldcoin]

A bicycle pump would be my guess with a polish adapter of course. Or perhaps an empty syringe with attached needle would be most efficient.

You got it……

I could just see a worm flying across the pond after being inflated with a bike pump.

Pretty funny

 

[Oldcoin]

Birch,

U are going to be banned for CAW. Cruility Against Worms!...:laugh: Tell me this, if you look at a worm which end is the head and which end is the tail?

.......

LOL PETA would love it. I've been using night crawlers, The flat part is the tail and the head is above the ring thingy that goes around the body.

 

[Birchtree]

I'd hunt for the anus and do it that way - you get no argument.

 

[Oldcoin]

On May 15, 2007, the Department of the Treasury will release data on U.S. international transactions and positions in financial derivatives. When will BEA incorporate these data in the balance of payments and international investment position accounts?


For the first time, the Department of the Treasury will release quarterly transactions data and yearend investment position data on financial derivatives. These data cover transactions and investment positions for 2006, and BEA will incorporate the data in its international economic accounts in its June 2007 annual revisions. The annual revision of the balance of payments transactions data will be released by BEA on June 15, and the 2006 U.S. international investment position will be released by BEA on June 28. At these times, BEA will also be incorporating other new and updated source data into its accounts. The data on financial derivatives will be included on new line items in BEA’s standard tables. In future releases of the balance of payments, BEA will incorporate quarterly derivatives transactions data on the newly established line item with a one quarter lag.

http://tinyurl.com/2vzm4v


Worms aside, have we had any discussions about financial derivatives or do we need to?

 

[Oldcoin]

I had to look it up at

http://www.investopedia.com/

Derivative:


In finance, a security whose price is dependent upon or derived from one or more underlying assets. The derivative itself is merely a contract between two or more parties. Its value is determined by fluctuations in the underlying asset. The most common underlying assets include stocks, bonds, commodities, currencies, interest rates and market indexes. Most derivatives are characterized by high leverage.


Futures contracts, forward contracts, options and swaps are the most common types of derivatives. Because derivatives are just contracts, just about anything can be used as an underlying asset. There are even derivatives based on weather data, such as the amount of rain or the number of sunny days in a particular region.

Derivatives are generally used to hedge risk, but can also be used for speculative purposes. For example, a European investor purchasing shares of an American company off of an American exchange (using American dollars to do so) would be exposed to exchange-rate risk while holding that stock. To hedge this risk, the investor could purchase currency futures to lock in a specified exchange rate for the future stock sale and currency conversion back into euros.

 

[Oldcoin]

ECONOMIC REPORT

ADP report finds weakest job growth in four years
Private-sector employment rises 64,000 in April

By Rex Nutting, MarketWatch
Last Update: 8:37 AM ET May 2, 2007


WASHINGTON (MarketWatch) -- U.S. private-sector jobs increased by 64,000 in April, the weakest job growth in nearly four years, according to the monthly ADP employment report released Wednesday.

Service-sector firms added about 106,000 jobs, while the goods-producing industries cut 42,000, including 20,000 in manufacturing. Goods-producing industries include manufacturing, mining and construction. The 22,000 jobs lost in goods-producing industries excluding manufacturing is the largest since November 2001.

Small businesses created 45,000 jobs, medium-sized firms created 29,000 and large businesses shed 10,000 jobs.

The ADP index, produced by Macroeconomics Advisers LLC for Automatic Data Processing Inc. ADP is considered by some economists to be the single-best indicator of the government's monthly nonfarm payroll report, which is due out on Friday.

The ADP report is designed to mirror the monthly nonfarm payrolls report released by the Labor Department on Friday. One difference: the Labor Department statistics include government jobs, but ADP doesn't.

http://tinyurl.com/yq2ue3

This is a report from ADP on jobs for April, the important thing to note is that it does not include the Government, which allows it to be……ummm how could I say this, well be changed by the numbers the Government gives to the Labor Department. So while the initial read is not good, a significant increase in Government jobs could alter the outlook. I think we saw something like this a few months ago.

 

[Oldcoin]

ECONOMIC REPORT

Biggest gain in factory orders in a year
New orders rise 3.1% in March on broad-based increase in demand
By Rex Nutting, MarketWatch
Last Update: 10:06 AM ET May 2, 2007


WASHINGTON (MarketWatch) - Orders for U.S.-made factory goods rose 3.1% in March, the biggest gain in a year, the Commerce Department reported Wednesday.

The 3.1% increase in factory orders was stronger than the 2.2% expected by economists surveyed by MarketWatch. The surprisingly strong increase suggests that the months'-long slump in factory output could be ending. Orders are down 1.1% in the past year.

The gains in March, led by a 38% increase in orders for civilian aircraft and an 11% increase in petroleum, were strong across the board.

Consider the strengths: Orders for core capital equipment - the kind of goods that businesses invest in to expand capacity or to increase productivity - rose 4.8%, the fastest pace in nearly three years and stronger than originally reported. Orders for durable goods were revised higher to 3.7%. Shipments of factory goods increased 1.5%, the highest in 10 months. Unfilled orders grew 1.8%, the fastest pace this year. Orders in February were revised up by four-tenths to 1.4%.

http://tinyurl.com/2g8xt5

 

[Oldcoin]

Factory Orders
• Importance (A-F): This release merits a D+.
• Source: The Census Bureau of the Department of Commerce.
• Release Time: 10:00 ET around the first business day of the month (data for two months prior).
• Raw Data Available At:

http://www.census.gov/ftp/pub/indicator/www/m3/index.htm.

Factory orders consist of the earlier announced durable goods report plus non-durable goods orders. The report is very predictable with nondurables the only new component. Nondurables consist of such items as food and tobacco products which grow at a fairly consistent monthly rate, so that market forecasts for this report are far more accurate than for the durable orders report. In addition to seeing nondurables for the first time, the market also watches for revisions to the durable orders data, which can be significant. At present, durable goods orders sum to about 54% of total orders.

The final piece of new information in this report is factory inventories -- the first glimpse at the inventory picture each month (wholesales inventories are typically released a week later, with retail inventories released a few days after wholesale inventories). Though the inventory figure is not a market-mover, economists use this number to help forecast inventories in the quarterly GDP report.

http://biz.yahoo.com/c/terms/facord.html

Okay, if you can believe some of what you read the Factory Orders report is not suppose to be a significant market mover. So how can the market jump on this report and totally disregard other negative items that have come up in the past week? Is there so much liquidity out there that there is a total disconnect between the market and reality?

 

[Oldcoin]

Who's Carrying the Economic Baton?
Part II - The Consumer?
BY CHRIS PUPLAVA

Last week's WrapUp looked at the corporate sector as the possible pillar underpinning the U.S. economy. The data presented showed businesses retiring stock and slowing capital investment domestically, while some corporations are actually increasing foreign capital investment. The data presented showed the corporate sector is clearly not holding the economy afloat on a rate of change basis.

Looking at the corporate and employee segments reveals a possible shift in trend, with corporate profits as a percentage of national income at the highest levels in over 50 years, clearly closer to a top then a bottom. Conversely, employee compensation as a percent of national income is at its lowest level in more than three decades and appears to be turning up at the same time the corporate share appears to be peaking.

http://www.financialsense.com/Market/cpuplava/2007/0425.html

A good read.

 

[Oldcoin]

ISM services index rises to 56%, above expectations
By Rex Nutting
Last Update: 10:04 AM ET May 3, 2007

WASHINGTON (MarketWatch) -- Businesses in the nonmanufacturing sectors of the economy were growing at a robust pace in April, according to the Institute for Supply Management. The ISM nonmanufacturing index rose to 56% in April from 52.4% in March. Economists were expecting the index to rise to 53.3%. Readings over 50% in the diffusion index mean more firms were growing than were shrinking. The index has been above 50% for 49 straight months. The new orders index rose to 55.5% in April from 53.8% in March. The employment index rose to 51.9% in April from 50.8% in March. The prices-paid index rose to 63.5% in April from 63.3% in March.

http://tinyurl.com/29vp9g


U.S. Q1 productivity up 1.7%, unit labor costs up 0.6%
By Greg Robb
Last Update: 8:30 AM ET May 3, 2007

WASHINGTON (MarketWatch) - Productivity of the U.S. non-farm business sector rose at a 1.7% annual rate in the first quarter, the Labor Department estimated Thursday. Economists were expecting productivity to rise 0.8% in the first quarter. Unit labor costs - a key inflationary signal - rose at an annual rate of 0.6% in the first quarter. This was well-below expectations of a 2.1% gain. Real hourly compensation fell 1.5% in the first quarter. Compared with the same quarter a year ago, productivity was up 1.1%, compared with a 1.6% gain in the fourth quarter. Unit labor costs rose 1.3% over the past year, down from a 3.4% rate in the fourth quarter.

http://tinyurl.com/yp7cgv

Initial Claims Highlights

There were no special factors behind a big 21,000 decline in initial jobless claims to a 305,000 level in the April 28 week that was well under outside expectations. Given the size of the drop, the four-week average will get attention, showing less improvement in the labor market at a 328,750 level, down 4,500 in the week. The level of continuing claims also showed improvement, down 93,000 to 2.495 million. The data were released with a better-than-expected productivity report, clouding their initial impact on the markets. But the data point to strength, a minus for bonds but a plus for the dollar and perhaps expectations for tomorrow's monthly employment report.

http://www.nasdaq.com/asp/econodayframe.asp?page=http://www.nasdaq.com/econoday/index.html

Well here are our economic reports for today, and not a downer in the bunch. The only real negative item was the increase in wages which is inflationary and gives the Fed more ammo to hold the rates current rather than lowering. That would put negative pressure on bonds. Later when I get a chance I’ll try to take a look at the underlying numbers and see what’s up. So if we can rely on the initial claims as an indicator, tomorrow’s jobs report might not disappoint.

 

[Oldcoin]

Of course if we look at the ADP report above the jobs report could be bad. No good indicators when you have conflicting reports that seem to go in two different directions.

 

[Oldcoin]

http://tinyurl.com/2h72wx

April Employment Report Preview

Payroll expectations for April have been drawn down given the lift in early April unemployment claims and following the strong March gain. The consensus estimate stands at 100K. Briefing.com looks for a slightly stronger 115K gain against the six and twelve-month averages of 164K.

The 100K consensus estimate would be the weakest gain in two years. Growth below 70K will be quickly met with questions about the consumer spending outlook and economic growth. A gain over 150K will continue to worry the inflation hawks regarding the tight labor market and the growing potential for wage-based inflation.

The drop in the March unemployment rate to a new post-recession low of 4.4% continues to raise concern as a 5.0% rate is generally seen as inflation neutral. A bump to 4.5% for April is widely expected but another decline would inflame underlying inflation worries.

Payroll growth, the unemployment rate and earnings growth all provide key insight for the path of consumer spending, which was a saving grace for first quarter GDP.

While the equity market won't like a report that piques inflation concerns, we suspect it will react more strongly to what the data imply about the pace of economic growth.

 

[Oldcoin]

ECONOMIC REPORT

Job growth sluggish in April
88,000 jobs created, lowest since November 2004

By Greg Robb, MarketWatch
Last Update: 8:43 AM ET May 4, 2007


WASHINGTON (MarketWatch) -- U.S. job growth slowed in April to 88,000 and the unemployment rate ticked up to 4.5%, the Labor Department said Friday.
In April, average hourly wages increased 2 cents, or 0.2%, to $17.25. Average wages rose 3.7% in the 12 months ended in April.

The average workweek fell to 33.8 hours from 33.9 hours.

Economists surveyed by MarketWatch were calling for payrolls to rise by 100,000, for the jobless rate to tick up to 4.5%, for average hourly earnings to rise 0.3% and for the workweek to hold steady at 33.9 hours.

http://tinyurl.com/2j6oub

Looks like the jumbo jobs report followed the ADP report.

 

[Oldcoin]

*** A FED, M3, and Inflation Commentary ***
M3 money inflows are running at a triple Fed projected rate for the year. The Fed had set a policy goal of increasing M3 by 10% per year for 3 years. Last year was year 1, and they were slightly over 10% This is year 2, and as of the end of April, they have already hit their 10% objective. What do they do now? If they continue at the prior 4 month pace, they will end up at a 30% M3 money inflation rate.

The top economists at Goldman Sachs, Merrill Lynch, and UBS have all come out publicly and have said that Bernanke is WRONG about interest rates having to rise to curb inflation. Their models ALL agree that the Fed should cut interest rates 3 times this year.

So, why is Bernanke so diametrically opposite in his stance?

Because he is inflating the money supply at an insane pace in order to avoid a recession ... and printing huge amounts of money is INFLATIONARY. This puts him in between a rock and a hard place. Is his plan to float lots of inflationary money, keep it high to stimulate the economy, and then use a higher interest rate as a braking mechanism so inflation doesn't get out of control?

He is facing a predicament where he has to keep inflating M3, and if he now lowers interest rates, inflation will get out of control.

Is he is now concerned that he can't do both without losing control over inflation, what are his options?

Has he backed himself into a corner?

Bernanke's problem is that if he lowers interest rates, he will have to Stop inflating M3 and the money supply. That has been his chief weapon to stimulate the economy in the face of a bad housing situation and sub-prime loan problems.

Next week's FOMC meeting announcement will be one of the most watched events by Institutions, Goldman Sachs, and Merrill Lynch for the past 12 months. (I posted no charts today ... just this "food for thought" commentary.)

Marty Chenard
www.StockTiming.net

 

[Oldcoin]

Fed Won't Change Rate Without Convincing Data: John M. Berry

May 4 (Bloomberg) -- Federal Reserve officials, confronted with conflicting evidence about where the U.S. economy is headed, won't change the 5.25 percent key interest rate at their policy-making meeting next week.

The Fed board members can't be sure that economic growth will rebound in the second half of the year, nor whether core inflation will subside gradually as they have hoped.

While the officials are less than certain about their forecast, they also have no strong reason to change it. Until convincing evidence emerges one way or the other, the overnight lending target set last June won't budge.
Some analysts are predicting there won't be a surge in growth -- and that the Fed will lower the rate to 4.5 percent by the end of the year. That won't happen unless it's clear that core inflation is slowing.

http://www.bloomberg.com/apps/news?pid=20601039&sid=ag3qcA2no9nU&refer=home

 

[350zCommTech]

Fed Won't Change Rate Without Convincing Data: John M. Berry

May 4 (Bloomberg) -- Federal Reserve officials, confronted with conflicting evidence about where the U.S. economy is headed, won't change the 5.25 percent key interest rate at their policy-making meeting next week.

The Fed board members can't be sure that economic growth will rebound in the second half of the year, nor whether core inflation will subside gradually as they have hoped.

While the officials are less than certain about their forecast, they also have no strong reason to change it. Until convincing evidence emerges one way or the other, the overnight lending target set last June won't budge.
Some analysts are predicting there won't be a surge in growth -- and that the Fed will lower the rate to 4.5 percent by the end of the year. That won't happen unless it's clear that core inflation is slowing.

http://www.bloomberg.com/apps/news?pid=20601039&sid=ag3qcA2no9nU&refer=home

Oldcoin,

What did you think about today's employment number? My opinion on the Fed is that they won't cut rates until we get a negative employment number GDP. I think today's number was very much inflated to help the dollar.