Tag Archives: Employment

The Economic Recovery Myth

Former OMB director David Stockman points out that the US government sector for the first time in history is shrinking: “The reason is that governments are broke… we are going to have to cut back government employment,” he says.

“I don’t think the market discounts anything anymore.”

David Stockman


“If you take core government plus the middle class economy (65 million jobs), that’s the breadwinning economy, if we take some numbers – how many jobs in the “core economy” in November – zero; how many jobs since last December: net zero; how many jobs since the bottom of the recession in June 2009: still a million behind from when the recession ended.”

As to whether the economy can grow without employment growth: “I can’t imagine how it can because employment growth generates income growth which is the basis for spending and saving ultimately and we are not getting income growth out of the middle class.”

According to Stockman the job growth has come almost exclusively from the part-time economy, saying:  “There is 35 million jobs in that sector, with an average wage of $20,000 a year: that is not a breadwinning job, you can’t support a family on that, you can’t save on that. Those jobs will not generate income that will become self-feeding into spending.”

And about the fact that the stock markets keeps on rising in spite of everything, Stockman says:

“I can’t explain the market… I don’t know what it is pricing today, I don’t think the market discounts anything anymore, it is purely a daytraders’ market that is trading off the FED, trading off the headlines. One day it is manic, the next day it is depressive, and we can’t draw any conclusions.”

From CNBC:

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(h/t: Zero Hedge)

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Unique Market Activity

Markit BOAT is a trade reporting platform which consolidates pan-European cash equity trade data from MTFs, Dark Pools and OTC transactions. The trading activity in this report took place on 24th September 2010 and was published by Markit BOAT on the same day.

“Trading activity reported with the “Market Condition” flag is excluded from this report.”

Markit Financial Information Service




Such trading activity is not relevant because the trade price and/or trading process does not reference or correlate with the then current market price.

Unique Market Activity

The “Unique Market Activity” section lists stocks which were not active on Markit BOAT on the previous trading day:

Name Sector Volume Turnover €
TOYOTA Consumer Goods 1,700,900 46,829,431
HONDA Consumer Goods 871,800 22,856,936
TOSHIBA Industrials 5,184,000 18,276,910
TDK Industrials 271,200 11,844,049
MITSUBISHI CORPORATION Industrials 672,400 11,492,024
NIPPON TELEGRAPH & TELEPHONE Telecoms 320,400 10,871,198
FUJITSU Technology 1,593,000 8,594,763
MITSUBISHI ELECTRIC Industrials 1,170,000 7,384,213
NTT DOCOMO Telecoms 5,312 6,815,342
RICOH COMPANY Technology 479,000 4,955,306

Top 10 Trades

Name Sector Volume Turnover €
TELEFONICA Telecoms 8,000,000 144,961,040
ARCELORMITTAL Basic Materials 5,000,000 120,250,000
SIEMENS Industrials 1,068,000 82,236,000
BANCO SANTANDER Financials 7,674,883 72,146,968
DEUTSCHE TELEKOM Telecoms 5,184,000 52,358,400
BP Oil & Gas 10,000,000 47,557,080
ROYAL DUTCH SHELL Oil & Gas 1,976,822 44,227,044
HSBC Financials 5,000,000 39,316,316
ENI Oil & Gas 2,500,000 39,057,800
GALP ENERGIA Oil & Gas 3,000,000 37,110,000

Major Movers

Name Sector Volume Volume (T-1) % Change
ENI Oil & Gas 27,391,805 2,320,766 1080%
RESOLUTION Financials 12,123,729 2,018,922 501%
BANCO SANTANDER Financials 13,136,718 3,206,195 310%
TESCO Consumer Services 10,794,812 3,109,840 247%
ITV Consumer Services 17,155,484 5,190,587 231%
TELEFONICA Telecoms 15,408,784 4,815,454 220%
BP Oil & Gas 18,891,046 5,971,347 216%
VODAFONE Telecoms 64,405,532 34,249,822 88%
INTESA SANPAOLO Financials 8,114,852 4,686,840 73%
DEUTSCHE TELEKOM Telecoms 7,473,741 4,354,223 72%

Top 10 ETF

Name Volume Turnover €
DJ STOXX 600 BANKS ETF 1,388,138 56,184,568
DB X TRACKERS – DJ EURO STOXX 50 ETF 1,184,618 32,901,254
DJ STOXX 600 OPTIMISED BANKS SOURCE ETF 427,790 31,356,701
DJ STOXX 600 OPTIMISED BASIC RESOURCES SOURCE ETF 74,888 23,759,922
DJ STOXX 600 OPTIMISED INDUSTRIAL GOODS & SERVICES SOURCE ETF 170,269 18,794,781
DB X TRACKERS – MSCI WORLD TRN INDEX ETF 653,649 13,788,969
DJ STOXX 600 OPTIMISED AUTOMOBILES & PARTS SOURCE ETF 78,600 13,393,971
DB X-TRACKERS II – IBOX EU SOVEREIGNS EUROZONE 3-5 TR INDEX ETF 71,500 11,994,840
DJ STOXX 600 OPTIMISED CONSTRUCTION & MATERIALS SOURCE ETF 62,000 9,758,480
DB X-TRACKERS – DJ STOXX 600 BASIC RESOURCES ETF 106,565 9,674,011

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S&P 500 Drops 3.4% On Disappointing Job Report

U.S. stocks fell at the opening bell, as investors were disappointed with the government’s May report that showed fewer-than expected jobs were created and job creation mostly came from hiring for the U.S. census.

The Dow Jones industrial average fell more than 1.5 percent at the opening, ending down 3,2% at 9.931 points. The New York Stock Exchange activated Friday the so-called rule 48 due to expectations of extreme volatility.

The S&P 500 Index declined 3.4 percent to 1,064.88 points, Friday. It is the biggest drop on the day of the U.S. Labor Department’s monthly jobs report since at least 1998, according to data compiled by Bespoke Investment Group LLC. The Dow Jones Industrial Average sank 324.06 points, or 3.2 percent, to 9,931.22. All 30 of its components retreated.

Investors got an unpleasant surprise from the Labor Department‘s report that 431,000 jobs were created last month. Most of those jobs, 411,000, came from the government’s hiring of temporary census workers. Economists polled by Thomson Reuters had forecast employers would add 513,000 jobs.

Hiring by private employers was particularly weak, which is raising concerns that the economic recovery remains slow. Private employers added just 41,000 jobs in May, down from 218,000 in April and the fewest since January.

The unemployment rate fell to 9.7 percent from 9.9 percent in April. That was slightly better than the 9.8 percent unemployment rate economists had forecast. That number, however, could creep higher again as more people try to find work and census workers lose their temporary jobs.

Overall, 15 million American remain unemployed. Including workers who have given up looking for work or part-time workers who want full-time jobs, the so-called underemployment rate dipped to 16.6 percent in May from 17.1 percent a month earlier.

The monthly jobs report is one of the most important reports on the economic calendar. High unemployment remains one of the biggest obstacles to strong, sustained growth. Without people returning to the work force, consumer spending is expected to remain sluggish and limit future growth. Consumer spending accounts for the bulk of economic activity.

You’ll find the full report here.

NYSE Activate Rule 48

At the New York Stock Exchange the regulators have now invoked the so-called rule nr.48, that is a precaution rule activated when market volatility is expected to be extremely high.

“Rule 48 suspends the requirement for market makers to send pre-opening indications, or bid and ask prices developing in auctions used to determine a stock’s opening price. The regulation is used “only in those situations where the potential for extremely high market-wide volatility would likely impair floor-wide operations at the exchange,” NYSE Euronext says in an e-mail.

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