Real U-3 Unemployment Rate: 11.6%
Propaganda unemployment rate: 8.1%; Real unemployment rate: 11.6%. Reason for difference: organic growth of labor force
which grows alongside the broader population. Don't be confused by
cheap explanations on TV why the labor force should be declining
(especially with ZIRP meaning pre-retirement workers have to stay in the
labor force ever longer to supplant their meager fixed income): the
widely accepted definition of the labor pool, that used by the CBO and
all other government forecasting agencies, assumes a 90,000 growth in the labor force every month as it has to keep in line with the growth of the US population!
The implication is simple: using a real labor force participation rate
long-term average of 65.8%, the real unemployment rate in April was
11.6%, based on the 5.4 million additional workers that should be
counted as part of the U-3 which then means that the real number of
unemployed is not 12.5 million but 17.9 million, which in turn implies a
11.6% unemployment rate in the US. This also means that the spread
between the propaganda, and the real number is now 3.5%: the most it has been since the early 1980s. People Not In Labor Force Soar By 522,000, Labor Force Participation Rate Lowest Since 1981
it is just getting sad now. In April the number of people not in the labor force rose by a whopping 522,000 from 87,897,000 to 88,419,000.
This is the highest on record. The flip side, and the reason why the
unemployment dropped to 8.1% is that the labor force participation rate
just dipped to a new 30 year low of 64.3%. St. Louis Fed's "Not In Labor Force" Data Is Now Officially Off The Chart
The comedy continues: the April "Not in labor force" seasonally adjusted print: 88,419,000. And yet, the maximum reading permitted by St Louis Fed Not in Labor Force (LNS15000000) graph: 88,000,000. The data has now officially dropped off the chart. No further commentary necessary.
US Added 115,000 Jobs In April, Huge Miss Of Expectations; Unemployment Rate 8.1%
Expectations were for an increase in non farm payrolls of 160,000, and a 8.2% unemployment rate. We got +115,000, and 130,000 privates. Unemployment rate at 8.1%, lowest since January 2009. Schrodinger is alive and well.More shortly
The Addbacks: +22K From Seasonal; +206K From Birth Death
The seasonally adjusted non-farm payroll number rose by 115K in April. That's great: it was a miss but such is life. Here is what the unadjusted data that led to this number says. The seasonal addback in April was +22K, a rapid break from the last 3 years when April saw a negative seasonal adjustment following the traditional huge positive adjustments in the January-March period, which in turn means that the record warm winter give back has not even started! As a result, the seasonal addbacks in 2012 are now a massive 4,499,000 jobs: jobs that have not been added but are expected to materialize based on historical seasonal patterns. And just as importantly, in April the Birth-Death addition was a whopping 206K, far greater than the comparable addition in 2010 and 2011, and much bigger than expected, which brings the year total now to a +20K cumulative total. It means, that by rough estimation, the reality is that in April the unadjusted, unbirth/deathed number was a decline of -111,000, and likely far worse once the true weather adjustments start taking place. This number is corroborated by the Household Survey which dropped by 169,000. So much for the recovery.
The Two Scariest Charts From Today's NFP Report, Or The Real "New Part-Time Normal"
Back in February Zero Hedge was first to point out that
while jobs may be growing (modestly) and the unemployment rate
declining (rapidly, on the back of all those leaving the labor force),
it was the quality of jobs that was troubling. Indeed, as today's NFP
report once again showed, the average hourly earnings barely
budged at $23.38 from $23.37 last month, and in fact declined on an
inflation-adjusted basis. Why? Because as we predicted both in February (and in 2010)
the US is increasingly becoming a population of part-time workers, as
full time jobs disappear for good, and are offshored abroad at best.
April confirmed everything we had been warning about: in the month, full
time jobs dropped to 114,478 from 115,290, an epic drop of 812,000 in full time jobs which was the biggest since... March 2009! The
offset? Why a surge in part-time jobs of course, which increased by
508,000 in the month of April. So while seasonally adjusted, birth/death
recasted jobs may have increased by 115,000, the real quality jobs,
imploded, which unfortunately is merely a part of a longer-term secular
trend as part of the new part-time normal.Today’s Items:
Official euro-zone unemployment now
stands at 10.9%. This is up from 9.9% a year before. Even economic
powerhouse Germany is being hit as many nations, within the EU, are
rejecting austerity. The employment crisis is threatening the
euro-zone’s stability.
Because the bogus CPI index cannot hide
the current rate of inflation, politicians, on both sides of the aisle,
want the CPI to be revised. Rest assured, that if real inflation, in
the future, is at 50% per month, the manipulated CPI will read 0.5%.
Next…
JC Penney Is Quietly Firing Lots Of Middle Managers Across The Country
http://www.businessinsider.com
JC Penney Is Quietly Firing Lots Of Middle Managers Across The Country
http://www.businessinsider.com
In a move, reminiscent of bankrupt
Circuit City, JC Penny is cutting a over a hundred of middle managers
across the country. In fact, workers will no longer receive commission
anymore. Looks like another store, that may no longer have a niche in
the market place, is about to bite the dust.
Stephen Leeb, of Leeb Capital Management,
says that the fundamentals in both Europe and the U.S. are horrendous.
He goes on to say that the euro is a complete joke and attempts to fix
the euro and dollar are going to fail. Once gold gets going, people will
be amazed at how fast the silver price moves with three digit silver in
the next couple of years. There simply isn’t enough silver available to
satisfy both the industrial demand and investor demand; therefore, keep
stacking.
Here are a few…
1. Entrusted with safety, the TSA is hiring new employees without conducting background checks.
2. Incandescent bulbs have to be phased out because they are safer on the environment than toxic CFL bulbs.
3. In Maryland, one man recently called 911 to report that someone had stolen his marijuana.
1. Entrusted with safety, the TSA is hiring new employees without conducting background checks.
2. Incandescent bulbs have to be phased out because they are safer on the environment than toxic CFL bulbs.
3. In Maryland, one man recently called 911 to report that someone had stolen his marijuana.
Knowing that they are losing viewers,
because of their stance on Ron Paul, it appears the powers that be at
FOX News are allowing Ron Paul’s name to actually be mentioned on air.
Note to Fox: Mentioning a person after the fact, is almost as bad as
never mentioning them at all. In short, a day late and a dollar short.
Next…
Rand Paul Launches Campaign to End the TSA
http://www.infowars.com
http://www.chooseliberty.org
Rand Paul Launches Campaign to End the TSA
http://www.infowars.com
http://www.chooseliberty.org
Senator Rand Paul has issued a press
release in which he vows to lead the charge to “End the TSA”. Please
help Rand Paul by signing the online petition and send those pot-bellied
thieves and pedophiles, at the TSA, packing.
Please donate...
Local Elections 2012: Our Last Chance For A Political Solution
There
is little doubt, even amongst the most uninterested and apathetic of
people, that America has reached the threshold of a dangerous new era
in 2012. Economically, the paper thin facade of recovery created by
Federal Reserve fiat easing is beginning to fade, and the debt turmoil
we currently see in the European Union is beginning to surface right
here at home. Socially, Americans are being subversively divided by
the false left/right paradigm and the exploitation of artificially
induced race tensions by the mainstream media. Politically, Barack
Obama’s presidential approval rating has hit all time lows, and the
approval rating for Congress has hit a historic bottom. The path our
country has been set upon can only lead to disaster; that much is
certain. Visualizing Why LTRO = QE
Quantitative
Easing (QE) is/was seemingly a magic remedy, at least in the
short-term. As GLG's Pierre Lagrange notes, central bankers can conjure
up money out of thin air and use it to purchase assets - transforming
transferring toxic debt, stimulating demand for risk assets, devaluing
currencies (this deflating debt), and maintaining low interest rates on
govvies. The ECB's more restrictive mandate, however, does not
allow them to print money for any other purpose than lending and so
direct QE was out of the question and so, as the chart below
demonstrates, they ingeniously created the LTRO - delivering an infusion of liquidity (potential profits from carry and hope for capital raises). Pop The Hood And Examine The Engine, Are Kidding Me?
Eric De Groot at Eric De Groot - 1 hour ago
Ignore the jobless rate; it's more a product of Disney's Imagineering unit
than statistical reality. The real unemployment rate is much higher than
reported. While job creation histogram (JCH) paints a picture of job
growth since 2011 (see chart 1), it has done so while the civilian labor
force has struggled to keep pace with the population. Now its tepid
advance is showing signs of...
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content, and more! ]]
Waiting For The Next Earthquake In Silver
Eric De Groot at Eric De Groot - 2 hours ago
Falling lease spreads continue to reflect the heavy hand of control leaning
on the price of silver (see chart 1). Chart: Silver Lease Spread Composite
(SLSC) and Silver Price, USD Why? A large short position in the future and
options market needs to be covered. This can be done into either weakness
or strength. The former keeps the short standing upright with money in
pocket,...
[[ This is a content summary only. Visit my website for full links, other
content, and more! ]]
The Definition Of A Bubble
Admin at Marc Faber Blog - 4 hours ago
People say the price of gold is in a bubble stage and it is up
substantially from the lows in 1999, which was, at the time, around $252
per ounce. But at the same time, we had an explosion of debt, not just
government debt, but private sector debt, and an explosion of unfunded
liabilities such as in the pension fund industry, and not just with
Medicare, Social Security and Medicaid.
So now, 12 years after the gold’s low, we are essentially in a situation
where maybe the price of gold should be much higher because the economic
and financial conditions are worse than they were 12 year... more »
Video: Market Update
Admin at Jim Rogers Blog - 4 hours ago
Watch
the latest video at <a
href="http://video.foxbusiness.com">video.foxbusiness.com</a>Video
interview, latest video market update.
*Jim Rogers is an author, financial commentator and successful
international investor. He has been frequently featured in Time, The New
York Times, Barron’s, Forbes, Fortune, The Wall Street Journal, The
Financial Times and is a regular guest on Bloomberg and CNBC.*
Gold Shares Performance Relative To Gold Nearing Historic Extremes
Eric De Groot at Eric De Groot - 13 hours ago
How bad has the gold shares under performance to gold been since 2010? The first response might be bad, but the the correct observation should be extreme. The gold shares to gold ratio produced 4.3 cycle Z-score reading of -2.35. This suggests severe under performance of the gold shares relative to gold through May 2012. This reading is the lowest reading since 2007.05 and seventh... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
The Mightiest Of Weapons
Sunday
marks the day in Greece, France, parts of Italy and Spain. May 6 will
stand out perhaps as the day when the fortunes of Europe were reversed
and if not reversed; re-programmed. There has been a lot of talk about
this of course and a lot of speculation in the Press and, one would
think, that it had all been discounted by the markets but not so fast.
The discount will only go as far as the political implications are
generally understood and we would submit that the particularities of the
European elections are not well understood at all. We think the
markets’ reaction is a first blush notion which does not get close to
the more pressing questions of what some of the potential changes in
power will mean past the revelry of the election night parties. Mr.
Hollande, in fact, represents the wave that is sweeping all across
Europe which is a return to Nationalism, to tribal pride, to economic
self-protection as the European Recession, as driven by the “austerity
measures” and fiscal restrictions imposed by Berlin deepen both the
economic travails and the reaction to finding your nation under the
economic jack boots of Berlin. All of the changes of guard in
Europe are going to have a profound effect upon the marketplace in my
view. There will be a widening of credit/risk spreads, a decline in the
equity markets, a decline of the Euro against the Dollar as Fear
climbs back in the driver’s seat and as uncertainty is the prevalent
theme of each day.Goldman's Payrolls Take: "One Consistent Message: Weak Growth"
Last weekend we first warned our readers that Goldman just pulled the rug from under today's NFP number, by slashing their NFP forecast to 125,000, which was among the lowest (LaVorgna's 175,000 call was only 50% off... as usual). At the end even Goldman was high. Here is Hatzius' post-mortem.WTI < $100
WTI
crude just broke $100 (traded $99.99) - an almost 3 month low having
dropped its most in the last 3 days since mid-December 2011. Remember:
it has long been known that Obama, pardon Bernanke, will not allow THE
NEW QE until a barrel of the black gold cost double digits. He just got
his wish.Who Leaked the NFP This Time?
Presented
with little comment except to note that in the minute or so before the
actual sanctioned release from the dark little room at the BLS,
S&P 500 e-mini futures slumped by 7 pts, surged and then slumped
again by 7pts - double the entire overnight range in those 30-45
seconds. So after all the efforts to maintain the integrity of the NFP
release, it seemed someone knew something early...How To Predict Today's Non-Farm Payroll Number With Planck Constant Precision
With everyone and their mother scrambling to come up with some utterly meaningless number (why is it meaningless? Because From January to March seasonal adjustments have "added" 4,477,000 jobs, and the monthly error interval is 100,000) to game the headline, which algos just can't wait for to send the market soaring (on either "virtuous circle" or "More QE" signals), here is our best suggestion on how to predict what the US economy will do all the way to the Planck constant. And at a sunk cost of only $24.99 to US taxpayers for bailed out US bank strategists, we are confident that expense committee will be able to say no to these oh so very critical products for the new "alive or dead" normal.
Overnight Sentiment: Traders Look Past Latest European Disappointment, Toward US Jobs
Here is what happened in Europe overnight, and why the market sentiment is already negative in advance of an NFP number which many are watching closely as a miss of expectations will cement the thesis that the US economy has now rolled over and will likely need more nominally dilutive aid from central planners to regain its upward slope:- Spain Services PMI for April 42.1 – lower than expected. Consensus 45.4. Previous 46.3.
- Italian Services PMI for April 42.3 – lower than expected. Consensus 43.7. Previous 44.3.
- France Services PMI for April 45.2 – lower than expected. Consensus 46.4. Previous 46.4.
- Germany Service PMI for April 52.2 – lower than expected. Consensus 52.6. Previous 52.6.
- Euro-area Service PMI for April 46.9 – lower than expected. Consensus 47.9. Previous 47.9.
Frontrunning: May 4
- Japan has 54 nuclear reactors, but as of Saturday, not one of them will be in operation (Guardian)
- US Readies Proposal to Clamp Down on Fracking (Reuters)
- California pension fund (CALSTRS) sues Wal-Mart, alleges bribery (Reuters)
- New Ripples for Gupta Case: Goldman Share Price, Volume Began Climbing Even Before Rajaratnam Trades (WSJ)
- China says blind dissident can apply to study abroad (Reuters)
- China paper calls Chen a U.S. pawn; envoy is a "troublemaker" (Reuters)
- Samsung’s New Galaxy S Phone Raises Heat on Apple Iphone (Bloomberg)
- Draghi predicts 2012 eurozone recovery (FT)
- Tumbling Home Ownership Marks a Return to Normal (Bloomberg)
- Zuckerberg Facebook IPO to Make Him Richer Than Ballmer (Bloomberg)
- SEC probes Chesapeake and its chief (FT)
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