Tag: news

It seems like it was an eternity ago that Obama was doing his post-government shutdown gloating media tour, when day after day the world was bombarded with news of the GOP’s record low popularity rating, paradoxically following their attempt to do what even the president is now desperate to achieve: delay Obamacare. Well, the tables have turned and now that the government shutdown is history, at least until January, and the public focus has shifted to where it should have been in the first place – namely the embarrassing ponzi scheme experiment that is Obamacare, and the epic failure surrounding its rushed rollout – it is Obama’s turn to suffer a record low rating, which is precisely what happened according to a just concluded WSJ/NBC News poll.

The WSJ reports that “the popular discontent that engulfed Republicans amid the partial government shutdown has now washed over President Barack Obama, whose job approval rating has sunk to an all-time low. Americans just weeks ago heaped scorn largely on congressional Republicans over the dysfunction in Washington. But the new poll found a sharp turn against Mr. Obama, during a month in which lawmakers tiptoed up to a potential debt default and the White House fumbled the rollout of its signature health-care law.

Specifically:

Mr. Obama’s job approval fell to 42%, with 51% of respondents disapproving of his performance as president. That marked a drop in his approval rating from 47% in early October and 53% at the end of 2012.

 

At the same time, more Americans now view Mr. Obama negatively than positively, for the first time since he emerged as a national political candidate.

 

In all, the poll of 800 Americans captured an extraordinarily deep and widespread public distaste for the two political parties, those parties’ leaders and the state of politics in the nation’s capital.

Elsewhere, it appears that Americans just have given up on the government system, whose increasing corruption and cooption by moneyed interests is now obvious to everyone:

Optimism about the U.S. system of government, at 30%, was at the lowest ebb in 40 years. Just 29% said their congressional representative deserved re-election—a new low—while nearly three-quarters said Congress was contributing to the problems in Washington instead of working to solve them.

 

House Speaker John Boehner and Senate Minority Leader Mitch McConnell, both Republicans, hit their highest negative ratings, as did Senate Majority Leader Harry Reid, a Democrat.

 

“Americans are voicing their frustration at a Congress that cannot keep the government open for business and an administration that cannot get health care open for enrollment,” Mr. Hart said.

 

Republican pollster Bill McInturff, who conducts the survey along with Democrat Fred Yang, described the findings as a “shock wave” that showed the depth of “anger and frustration with everybody in Washington.”

Frustration… and yet nobody will dare to change anything for fear of losing their precious entitlements, which are unsustainable as is and like in Detroit will end up with pennies on the dollar, or for fear of infringing on their Dancing with the Stars TV time.

Visually:

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/vSwcEhzPfSk/story01.htm Tyler Durden

Submitted by Michael Krieger of Liberty Blitzkrieg blog,

Just when you think the Obama Administration can’t stoop any lower they immediately come in and surprise you. In this incredible clip from CNN, we learn that insurance company executives are being threatened with retribution if they publicly criticize the rollout of ObamaCare, or inform the public about some of the most pressing issues with the disastrous healthcare plan.

In the most powerful part of the clip, Robert Laszewski, the President of Health Policy and Strategy Associates, LLC claims that healthcare executives warned the Obama Administration about severe problems with the rollout ahead of time, and that they were completely ignored. Our government in an inept mafia. Nothing more, nothing less.

 

 

I highlighted some of the issues with the plan back in June of last year in the piece: Thoughts on Obamacare from a Surgeon and Friend.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/Bm0ZzhtiHdY/story01.htm Tyler Durden

Following Japan’s scrambling of fighter jets for the 3rd day in a row, China has revealed that its first fleet of nuclear submarines has started sea patrols, in the latest sign of its military’s growing confidence which has raised concerns in the region. As The FT reports, Xinhua, China’s official news agency, released photographs of what appeared to be Xia-class vessels – China’s first generation of nuclear-armed submarines, which are several decades old – saying they were being “declassified” for the first time, adding with supremely colorful language that, the subs would “gallop to the depths of the ocean, serving as mysterious forces igniting the sound of thunder in the deep sea”, and be an “assassin’s mace that would make adversaries tremble”.

 

 

Via The FT,

…

 

While the submarines displayed on Sunday were the older generation of nuclear vessels that are part of China’s northern fleet – and not the more advanced Jin-class based at the southern Chinese island of Hainan – the display in the domestic media nonetheless reflects the Chinese military’s growing confidence.

 

“It is still the first time that the Xia class has been discussed in such detail in China’s state-run media,” said Taylor Fravel, an expert on Chinese security at the Massachusetts Institute of Technology in the US. “As China’s military modernisation continues to advance, the PLA has become more willing to discuss its capabilities.”

 

…

 

In recent years, the People’s Liberation Army Navy has become increasingly active in the Pacific, particularly in staking Chinese claims to disputed maritime territory in the South China Sea.

 

Chinese ships and aircraft have also become more aggressive in challenging Japanese control of the Senkaku Islands – which China calls the Diaoyu – in the East China Sea. Japan has administered the uninhabited group for decades, but China and Taiwan both claim sovereignty.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/GZRzr6_P9eI/story01.htm Tyler Durden

Following Japan’s scrambling of fighter jets for the 3rd day in a row, China has revealed that its first fleet of nuclear submarines has started sea patrols, in the latest sign of its military’s growing confidence which has raised concerns in the region. As The FT reports, Xinhua, China’s official news agency, released photographs of what appeared to be Xia-class vessels – China’s first generation of nuclear-armed submarines, which are several decades old – saying they were being “declassified” for the first time, adding with supremely colorful language that, the subs would “gallop to the depths of the ocean, serving as mysterious forces igniting the sound of thunder in the deep sea”, and be an “assassin’s mace that would make adversaries tremble”.

 

 

Via The FT,

…

 

While the submarines displayed on Sunday were the older generation of nuclear vessels that are part of China’s northern fleet – and not the more advanced Jin-class based at the southern Chinese island of Hainan – the display in the domestic media nonetheless reflects the Chinese military’s growing confidence.

 

“It is still the first time that the Xia class has been discussed in such detail in China’s state-run media,” said Taylor Fravel, an expert on Chinese security at the Massachusetts Institute of Technology in the US. “As China’s military modernisation continues to advance, the PLA has become more willing to discuss its capabilities.”

 

…

 

In recent years, the People’s Liberation Army Navy has become increasingly active in the Pacific, particularly in staking Chinese claims to disputed maritime territory in the South China Sea.

 

Chinese ships and aircraft have also become more aggressive in challenging Japanese control of the Senkaku Islands – which China calls the Diaoyu – in the East China Sea. Japan has administered the uninhabited group for decades, but China and Taiwan both claim sovereignty.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/GZRzr6_P9eI/story01.htm Tyler Durden

When will the U.S. labor market start to accelerate?  That is the single most critical question for global capital markets, for it speaks directly to both economic growth and Federal Reserve monetary policy.  But, as ConvergEx’s Nick Colas notes, just as important, however, is the question “Where do people actually want to work?”

Via ConvergEx’s Nick Colas,

In today’s note we address both topics with a range of Google Trends analysis, looking at what both employers and prospective employees plug into the ubiquitous online search engine.  Key conclusions: there is no evidence of any faster pace of hiring, and the trend of hiring part time labor over full time is both strong (a 3:1 ratio) and accelerating.  As far as where online interest in available jobs runs deepest, Google outpaces Facebook and Apple by over 2:1, but interest in working at Twitter just surpassed searches for “Work at Microsoft”.  Stock markets clearly guide how a society allocates its intellectual capital, perhaps more than historical experience would indicate.

The good times in U.S. equities – and many other global stock markets – are undeniable, but it will be time to worry again soon enough.  Rallies – such as the one we’re seeing at the moment – create future obligations.  In this case, the +23% return for 2013, plus whatever we tack on between now and the end of the year, is essentially a promise of good news to come.  Markets discount the prevailing view for growth in the economy and corporate earnings.  And right now, the market weatherman is calling for sunny skies and fair weather for 2014.

The linchpin issue for global stock returns in 2014 centers on one group of people: the 11.3 million unemployed workers in the United States.  That isn’t to dismiss those suffering from unemployment in Europe, for example, or elsewhere in the world.  That 4.5% of the U.S. adult non-institutionalized population does, however play a critical role in the future returns for stocks globally.  Here is why:

U.S. labor markets have been stuck in first gear since 2011, generating an average of only 170-180,000 jobs over the past 12 months.  After natural population growth (100,000/month) that means only 70-80,000 jobs added, or 0.05% of the population.

 

The Federal Reserve has tried to juice the economy with Quantitative Easing, pushing capital into the financial system by buying Treasury and mortgage backed bonds.  That has kept interest rates low, spurred the purchase of autos and homes, and helped give the U.S. the limited employment growth we mentioned above.

 

The ebbs and flows of the Fed’s commentary regarding QE – its ongoing duration and amount – have become heavily correlated with global equity returns.  You don’t have to look any further than the June Fed press conference or the last FOMC meeting to prove that.  Chatter about “Tapering” the QE program causes a pullback, while confidence that it will continue lifts risk assets higher.  I am sure you can find academics or market watchers who will tell you this is just ‘Correlation’ and not ‘causation’.  Feel free to listen to them, but don’t invest with them.  Ever.

 

Given the anemic October employment report, the recent government shutdown, and concerns over the U.S. consumer, it seems unlikely the Federal Reserve will reduce its bond buying until 2014.  That leaves stocks to rally into the end of the year.  Easy peasy, right?

 

But then what?  The U.S. economy and public companies will have to deliver on the implicit promise of record high stock prices with a combination of faster economic growth and better earnings.  The connective tissue between those aspirations is incremental domestic job growth.

 

Can’t the Fed just keep lifting stocks higher with more QE, regardless of where the U.S. economy ends up?  They can try, but there has been enough reporting on the opinions of the members of the Federal Open Market Committee for us to know that the Fed is growing concerned over the chance for a bubble in risk assets, including stocks.  The world gives the U.S. a lot of collective slack because of its reserve currency status, but everything has a limit.  As the Fed approaches a $4 trillion balance sheet ($3.8 trillion as of October 13, or 24% of GDP), policymakers know they are closer to the end of QE than the beginning.

 

That might all sound like bad news – QE is coming to an end, watch out below! – but it also makes U.S. stocks essentially a one-decision asset class.  Job growth here simply has to get better.  Maybe not today, maybe not tomorrow, but soon, and for the rest of our lives (spurious Casablanca quote there).

With that in mind, we turned to Google’s Trends product to give us a sense of where the U.S. labor market is heading.  This free service allows you to see how many people have searched for a given phrase back to 2005 and also compare those search tallies with other phrases.  With a global search market share of 67%, Google is as clear a window onto the soul of society as you will likely ever find.  And, therefore, a good window into the soul of employer and employee alike.

Here’s what we found:

Search terms: “Hire workers” and “Fire workers”.  Figuring that employers would search terms like “Hire” and “Fire” more than workers, we started with these simply keywords.  More “Hires”
than “Fires” entered into the Google search box would be a good sign of hiring to come.

 

The Trends data supports that the U.S. jobs market is improving – “Hire workers” gets more searches than “Fire workers” and has since the beginning of 2011.  The two still move closely together, however, indicating that there is little momentum in American labor markets.

 

Search terms: “Hiring part time” and “Hiring full time”.  As of the most recent Jobs Report, 7.9 million Americans are stuck working part time when they would prefer to have full time employment.  Department of Labor statistics show that the increasing reason for this “Part time recovery” is that these individuals could only find part time work, rather than being put on a part time schedule by their employer due to slack demand.

 

The Google Trends data shows the magnitude of the problem: searches for the phrase “Hiring part time” outnumber “Hiring full time” by 3:1.  Google Trends allows you to see which U.S. states have the greatest number of searches for each term.  The best states for “Full time hiring”: Texas, Missouri, North Carolina, and Georgia.  “Hiring part time” is popular in South Carolina, Kentucky, and Alabama.

 

Simply put, there is a lot more interest on the part of employers to advertise part time jobs than full time employment, and the gap between the two is growing.  Part time employment may serve to reduce the unemployment rate, but it will do less to improve consumer spending or confidence.

 

Search term: “Jobs for seniors”.  If you want to see growth in the U.S. labor market, just focus on the AARP set.  Those workers 55 and older have roped in the lion’s share of the jobs in the last year – 962,000 of th
e 1.3 million total positions added since September 2013.

 

Older Americans were early to the employment party in the current anemic economic recover, knowing that they would need to work even as they hit their golden years.  The Trends data for “Jobs for Seniors” shows a distinct pickup in 2009 and has stayed at these elevated levels since then.  Top states for the senior job search set?   Ohio, Arizona, and (of course) Florida.

 

Search terms: “Jobs at Microsoft” and “Jobs at Twitter”.  The Google Trends data is also useful for examining where people want to work.  Microsoft, for example, has been a popular employment search-related query on Google since 2005, when the data begins.  Twitter’s impending IPO has, for the moment, made the social media company a hotter employment ticket, however.    The ratio of searches for employment at Twitter as compared to Microsoft was 75:60 last month.

 

Search terms: “Jobs at Google”, “Jobs at Facebook” and “Jobs at Apple.”  Between these three, the number of queries by people search employment at landmark tech companies skews heavily to Google.  Interestingly, this is not a new phenomenon.  All the way back to 2005, the search engine company received multiple more interest in employment opportunities than either Facebook or Apple.  The ratio even now is still healthily in Google’s favor: a Trends score of 71 for Google, versus 24 for Facebook and 21 for Apple.

In summary, we see two trends in this data:

U.S. stocks are getting a free pass as we close out 2013, lifted by performance chasing at the end of a strong year and little threat of Federal Reserve tapering.  At the same time, 2014 is going to have to deliver some actual employment growth to support elevated stock prices.  We don’t see any sign of that in the Google data.

 

As far as where people want to work, stock market chatter does seem to have an impact.  It is easy to say that this is just performance chasing as well, with the hopes of easy millions from options and stock grants.  Still, it also shows that equity markets influence where a society’s intellectual capital chooses to hang its collective hat. 

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/hfBZqBLv5fM/story01.htm Tyler Durden