Tag Archives: Great Depression

News, Politics, Government

Remarks by the President on Jobs for the Middle Class, 07/30/13

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By The White House

Amazon Chattanooga Fulfillment Center
Chattanooga, Tennessee

2:00 P.M. EDT

THE PRESIDENT: Hello, Chattanooga! (Applause.) It is good to be back in Tennessee. (Applause.) It’s great to be here at Amazon. (Applause.)

I want to thank Lydia for the introduction and sharing her story. Give Lydia a big round of applause. (Applause.) So this is something here. I just finished getting a tour of just one little corner of this massive facility — size of 28 football fields. Last year, during the busiest day of the Christmas rush, customers around the world ordered more than 300 items from Amazon every second, and a lot of those traveled through this building. So this is kind of like the North Pole of the south right here. (Applause.) Got a bunch of good-looking elves here.

Before we start, I want to recognize your general manager, Mike Thomas. (Applause.) My tour guide and your vice president, Dave Clark. (Applause.) You've got the Mayor of Chattanooga, Andy Berke. (Applause.) And you've got one of the finest gentlemen I know, your Congressman, Jim Cooper. (Applause.) So thank you all for being here.

So I’ve come here today to talk a little more about something I was discussing last week, and that’s what we need to do as a country to secure a better bargain for the middle class -– a national strategy to make sure that every single person who's willing to work hard in this country has a chance to succeed in the 21st century economy. (Applause.)

Now, you heard from Lydia, so you know — because many of you went through it — over the past four and a half years, we’ve been fighting our way back from the worst recession since the Great Depression, and it cost millions of Americans their jobs and their homes and their savings. And part of what it did is it laid bare the long-term erosion that’s been happening when it comes to middle-class security.

But because the American people are resilient, we bounced back. Together, we've righted the ship. We took on a broken health care system. We invested in new American technologies to reverse our addiction to foreign oil. Changed a tax code that had become tilted too much in favor of the wealthy at the expense of working families. Saved the auto industry, and thanks to GM and the UAW working together, we're bringing jobs back here to America, including 1,800 autoworkers in Spring Hill. (Applause.) 1,800 workers in Spring Hill are on the job today where a plant was once closed.

Today, our businesses have created 7.2 million new jobs over the last 40 months. This year, we’re off to our best private-sector jobs growth since 1999. We now sell more products made in America to the rest of …read more

Source: FULL ARTICLE at The White House Press Office

Articles of Interest

Beer Can House, Houston’s Bizarre Attraction (PHOTOS)

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By The Huffington Post News Editors

HOUSTON — A child of the Great Depression, John Milkovisch didn’t throw anything away – not even the empty cans of beer he enjoyed each afternoon with his wife.

So, in the early 1970s when aluminum siding on houses was all the rage, he lugged down the cans he had stored in his attic for years, painstakingly cut open and flattened each one and began to wallpaper his home.

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Source: FULL ARTICLE at Huffington Post

Articles of Interest

What Will Happen When The Government Collapses?

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By Floyd Brown

Yesterday, my colleague, Marty Biancuzzo, explained why America is on a path to inevitable economic and government collapse.

After reading Marty’s piece, another colleague asked me: What will America look like after a government collapse?

It’s an important question, and I want to give a satisfactory answer. But I can’t do that in one short column, so I plan to return to this topic several times over the next few weeks. I hope that when I’m done, you will have a better understanding of where the country is headed.

Now, consider our current situation…

It’s clear that Barack Obama and Congress have no plan to get the dead-in-the-water economy moving. In fact, they appear to be completely incompetent.

Too many Americans are jobless, an excessive number of Americans are dependent on government handouts to eat, and the countless Americans who could contribute to the economic recovery are frozen in place, unwilling to take risks due to an uncertain regulatory environment.

Now, it’s fashionable in some governmental circles to argue that another Great Depression could never happen. Politicians reason that America at present has far more tools to prevent such a cataclysm.

They believe that “things are different this time.”  If only they knew how right they were.

It Is Different This Time… It’s Worse

I’ve heard investment advisors, central bankers, and politicians use the phrase “It’s different this time” so often, I want to wretch. This asinine statement is arrogant beyond reason.

Frankly, I believe we’re much more vulnerable to a prolonged depression than we were in 1929.

Here’s the truth: Today’s monetary manipulation may forestall a bust, but it can’t change the fact that one is inevitable. And when it arrives, it’ll be more devastating and difficult to solve than in the past.

Don’t believe me? Well, I’ve identified seven reasons why we are in fact worse off today than we were leading up to the crash in 1929.

  1. In 1929, America had by no means the social problems we face today.
  2. In 1929, the federal government had very little debt. Today, we have a staggering $16.5 trillion in debt.
  3. In 1929, most state governments weren’t facing insolvency. Today, they are flat-out broke. We have $4 trillion in unfunded pension liabilities at the state level, thanks to decades of union control of local government.  There were no public employee unions in 1929.
  4. In 1929, we didn’t have Social Security, Medicare, and Medicaid, much less Obamacare.  Our obligation to these entitlement programs will consume our entire federal budget in a few years.
  5. In 1929, the costs associated with illegal aliens were non-existent. Today, in California alone, it costs $10.5 billion to pay for the incarceration, health care, and welfare costs of illegal aliens.
  6. In 1929, today’s massive government dependency culture was unheard of. Today, we have food stamps and dozens of other housing and welfare programs. Indeed, over 100 million Americans are now dependent on the Federal government for something.
  7. Taxes were significantly lower in 1929 than today, even as a percent of family income.  Most businesses paid no taxes in 1929; and today, we have the highest corporate tax rate

    Source: FULL ARTICLE at Western Journalism

Business, Finance, Occupation & Industry

How Almost Always Being Wrong Has Changed the Wall Street Analyst

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By Morgan Housel, The Motley Fool

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In hindsight, everyone saw the financial crisis coming. The crazy lending, the high leverage, the soaring home prices. It all made so much sense.

In reality, few did. Some saw troubles, or imbalances. But very, very few truly foresaw the magnitude of what would occur in 2008.

And the surprise of 2008 wasn’t … a surprise. Wall Street analysts and economists have missed nearly every significant market turning point for as long as anyone can remember. In an interview two years ago, Yale economist Robert Shiller told me:

In particular, if you look at the Great Depression of the 1930s, nobody forecasted that. Zero. Nobody. Now there were, of course, some guys who were saying the stock market is overpriced and it would come down, but if you look at what they said, did that mean a depression is coming? A decade-long depression? That was never said.

I have asked economic historians, give me a name of someone who predicted the depression, and it comes up zero.

The proof of how bad we are can be just sad. Economists Ron Alquist and Lutz Kilian once looked at all the fancy math models and forecasts analysts use to predict the price of oil one month, one quarter, and one year out. They found that simply assuming that whatever the price of oil is today is what it will be in the future is one of the best predictive strategies. Is it a good strategy? No. But it was better than most forecasting techniques highly paid analysts and consultants use.

In another study, Dresdner Kleinwort looked at Wall Street‘s predictions of interest rates over a 15-year period and compared them with what interest rates actually did in, with the advantage of hindsight. It found an almost perfect lag. If interest rates fell, Wall Street would wait six months and then predict that interest rates were about to fall. When interest rates rose, Wall Street would wait six months and then declare that interest rates were about to rise.

“Analysts are terribly good at telling us what has just happened but of little use in telling us what is going to happen in the future,” the report concluded.

From 2003 to 2007, Standard & Poor’s predicted that 0.12% of a certain type of mortgage bond would default. In reality, 28% did.

In 2008, analysts predicted the S&P 500 would earn $94 per share. In reality, it earned $15 per share.

In 2008, oil giant Gazprom’s CEO predicted that oil would soon hit $250 a barrel. Instead, it soon hit $33.

For more fails, see here and here and here and here.

We live in a world engulfed by predictions and forecasts. Yet very few ever stop to ask the pertinent question, “What is the evidence that we’re any good at it?”

Those who have looked at it invariably come to the same answer: There is none. But we still lap predictions up, putting our faith in them to

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

J.C. Penney's Been a Survivor Before

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By Alex Planes, The Motley Fool

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On this day in economic and business history …

James Cash Penney opened his first store, one of a chain known as “the Golden Rule,” in Kemmerer, Wyo., on April 13, 1902. Penney originally operated the store in partnership with two other entrepreneurs, but Penney proved the more dedicated of the three partners, and within five years the others had sold their interests and Penney was in sole control of three Golden Rule stores. Within a decade, there were nearly three dozen stores scattered across the Rocky Mountain states, and it was time for a new name for the business: J.C. Penney , named after the man who built it.

J.C. Penney grew rapidly throughout the western half of the United States and had more than 1,400 stores in 1929, just before the stock market meltdown. Unfortunately for James Penney, the crash of 1929 destroyed much of his wealth, and the economic effect of the Great Depression was such that he had to borrow against life insurance policies just to meet J.C. Penney’s payroll. Penney (the man and the company) survived the Depression and grew again, but it took a toll on the health of both. James Cash Penney wound up checking into the Battle Creek Sanitarium — the birthplace of Kellogg , where the highly religious Dr. John Harvey Kellogg attempted to cure his patients with boring food — to recover from the stress of nearly losing everything. That was the end of his corporate leadership, but James Penney remained chairman of the board until after World War II and would serve as an honorary chairman until his death in 1971.

J.C. Penney is also notable, beyond its leading role in American retail, for its formative imprint on Sam Walton. The Wal-Mart founder’s first job following his college graduation was as a management trainee in an Iowa J.C. Penney store. Penney’s focus on maximizing the value of customers’ visits and their purchases remain clear in Wal-Mart’s corporate focus to this day. By the time Walton opened his first Wal-Mart in 1962, J.C. Penney was already truly national — it had opened a store in Alaska that year, and its first Hawaiian location would open four years later. A decade later, J.C. Penney had more than 2,000 stores across the country. This was “Peak Penney,” and the company has never been quite as large, or quite as important to the American economy, since.

The roots of American insurance
A number of prominent Philadelphia citizens and businessmen came together on April 13, 1752, to form the Philadelphia Contributionship, the first property insurance company in the United States. As with many other important developments in early American history, this one owed its genesis to Benjamin Franklin, who had founded Philadelphia’s first volunteer fire brigade in 1736 and saw a clear benefit to insuring the properties that might eventually

From: http://www.dailyfinance.com/2013/04/13/jc-penneys-been-a-survivor-before/

Business, Finance, Occupation & Industry

Dow Futures Lower Amid Bank Earnings

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By Roland Head, The Motley Fool

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LONDON — Stock index futures at 7 a.m. EDT indicate that the Dow Jones Industrial Average may open up by 0.18% this morning, while the S&P 500 may open 0.22% higher as investors wait for the latest quarterly results from banking giants JPMorgan Chase and Wells Fargo.

European markets fell this morning as fears grew that Cyprus may need an additional 6 billion euros for its bailout, taking the total value of the bailout to 23 billion euros. The subject will be under discussion at today’s meeting of eurozone finance ministers, but there is likely to be strong resistance to providing more funds. Although the amount of money involved is small in the context of the eurozone economy, investors are worried that the precedents set in Cyprus may eventually be applied to some of the eurozone’s other troubled — and much larger — economies. Adding to the bad news, new figures this morning showed that eurozone industrial production fell by 3.1% in February compared with the previous year and rose by just 0.4% from January.

In the U.S., economic reports today are expected to show that retail sales and the producer price index edged lower in March. Both reports are due at 8:30 a.m. EDT, and consensus forecasts indicate that retail sales may have fallen by 0.1% in March after rising 1.1% in February, while the producer price index is expected to have fallen 0.3% in March after rising 0.7% in February. April’s consumer sentiment index reading is due at 9:55 a.m. EDT, and analysts are forecasting a small rise to 79.3, up from 78.6 in March.

The big news today may be bank earnings. JPMorgan Chase reported first-quarter earnings of $6.53 billion, or $1.59 per share, beating expectations of $1.39 per share. The outperformance owed largely to increased mortgage-lending. Despite the earnings beat, however, the bank’s stock is down 0.8% in premarket trading.

Wells Fargo is also due to report earnings before markets open this morning. Analysts are expecting earnings of $0.89 per share, up from $0.75 for the same period in 2012.

Other stocks that could be actively traded this morning include Harris, which is down 7.4% in pre-market trading after it issued a new revenue forecast that missed analysts’ estimates. Microsoft stock may also fall when markets open; the maker of the Windows operating system fell 4.4% in trading yesterday and is down 0.5% in premarket trading this morning.

Finally, let’s not forget that the Dow’s daily movements can add up to serious long-term gains. Indeed, Warren Buffett recently wrote, “The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions.” If you, like Buffett, are convinced of the long-term power of the Dow, you should read “5 Stocks To Retire On.” Your long-term wealth could be transformed, even in this uncertain economy. Simply click here now to download this free, no-obligation report.

From: http://www.dailyfinance.com/2013/04/12/dow-futures-lower-amid-bank-earnings/

Business, Finance, Occupation & Industry

Dow May Open Higher, but HP Could Plunge

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By Roland Head, The Motley Fool

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LONDON — Stock index futures at 7 a.m. EDT indicate that the Dow Jones Industrial Average may open up by 0.11% this morning, while the S&P 500 may open a single point higher. Investors are cautious ahead of today’s jobs figures, but yesterday’s gains helped drive the CNN Fear & Greed Index back into “greed” territory: The sentiment indicator closed at 62 yesterday, up from 53 the previous day.

In Europe, markets edged slightly higher this morning, as the absence of new economic data meant that investors focused on corporate news and renewed hopes for Chinese growth. At 7 a.m. EDT, the FTSE 100 was up 0.32%, Germany’s DAX was up 0.51% and the French CAC 40 was 0.49% higher.

Thursday is jobless-claims day, and last week’s disappointing jobs figures mean investors will be focusing more closely than usual on this key metric when it is published at 8:30 a.m. EDT. Consensus forecasts indicate that 360,000 new jobless claims may have been made last week, down slightly from 385,000 in the previous week. Also due at 8:30 a.m. EDT, March’s import price index is expected to show a 0.5% fall in import prices following a 1.1% rise in February.

Companies due to update the market this morning include Costco Wholesale, which said this morning that like-for-like sales for the five weeks to April 7 rose by 4%, missing a Reuters forecast of 5.2%. Costco’s total sales rose by 7% over the same period to $9.67 billion from $9.07 billion last year. Before the opening bell, quarterly results are expected from Commerce Bancshares, iGate Corporation, Pier 1 Imports, and Rite Aid, among others.

Stocks that could be actively traded this morning include Intel, Hewlett-Packard, and Microsoft, which all fell heavily in after-hours trading last night following news that global PC sales dropped by 14% during the last quarter. HP shares were 4.1% lower in premarket trading, while Microsoft was down by 3.4% and Intel was 1.9% lower. Housewares retailer Bed Bath & Beyond may also be actively traded after it posted earnings growth of 6.5% in its fiscal fourth quarter but said that earnings for the current quarter would be between $0.88 and $0.94 per share, below consensus forecasts of $0.95 per share. Bed Bath & Beyond shares closed 1.6% higher yesterday and were 1.5% higher in premarket trading this morning.

Finally, let’s not forget that the Dow’s daily movements can add up to serious long-term gains. Indeed, Warren Buffett recently wrote, “The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions.” If you, like Buffett, are convinced of the long-term power of the Dow, you should read “5 Stocks to Retire On.” Your long-term wealth could be transformed, even in this uncertain economy. Simply click here now to download this free, no-obligation report.

The article Dow May Open Higher, but HP Could Plunge

From: http://www.dailyfinance.com/2013/04/11/dow-may-open-higher-but-hp-could-plunge/

Business, Finance, Occupation & Industry

Dow May Open Higher After Chinese Imports Beat Expectations

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By Roland Head, The Motley Fool

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LONDON — Stock index futures at 7 a.m. EDT indicate that the Dow Jones Industrial Average may open up by 0.29% this morning, while the S&P 500 may open 0.26% higher. The Dow closed at a new record high of 14,673.46 yesterday, but the CNN Fear & Greed Index remained almost unmoved at 53, or “neutral.”

European markets moved strongly higher this morning after Chinese import and export figures beat analysts’ forecasts. Imports rose by 14.1% in March, while exports rose by 10%, boosting trade hopes for European companies. At 7:20 a.m. EDT, the German DAX was up 1.16%, and the French CAC 40 was 1.18% higher. In London, the FTSE 100 was up 0.76%, helped by a strong showing from mining firms and financial stocks, which collectively make up the majority of the index’s capitalization.

In the U.S. today, investors are likely to focus closely on the minutes of March’s Federal Open Markets Committee meeting, which may provide some insight into the current thinking of the Fed’s interest rate-setting committee. The minutes are due to be published at 2 p.m. EDT, when details of March’s federal budget are also due to be released.

In other news, the Mortgage Bankers Association reported earlier this morning that its weekly mortgage-applications index increased 4.5% following a 4% decline the previous week. The EIA weekly petroleum status report is due at 10:30 a.m. EDT.

Companies due to report quarterly earnings before markets open this morning include Constellation Brands, CarMax, MSC Industrial Direct, and Bed Bath & Beyond. Earlier this morning, Fastenal reported quarterly earnings of $0.37 per share, an 8.8% increase on the same period in 2012. Fastenal also announced a $0.20 cash dividend for the second quarter of 2013.

Stocks that may be actively traded today include Herbalife, which slid nearly 4% before markets closed yesterday after it revealed that its auditor, KPMG, was to resign. The decision is the result of insider-trading allegations against the KPMG partner responsible for auditing the nutritional-supplements company, which is already the subject of a war of words between activist investors Carl Icahn and William Ackman. Trading in J.C. Penney shares may also be heavy after the retailer’s share price slid a further 12% in trading yesterday. The company’s shares have now fallen almost 60% over the last year.

Finally, let’s not forget that the Dow’s daily movements can add up to serious long-term gains. Indeed, Warren Buffett recently wrote, “The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions.” If you, like Buffett, are convinced of the long-term power of the Dow, you should read “5 Stocks To Retire On.” Your long-term wealth could be transformed, even in this uncertain economy. Simply click here now to download this free, no-obligation report.

The article Dow May Open Higher After Chinese Imports Beat Expectations originally appeared on Fool.com.

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Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Dow May Open Higher After Alcoa Beats the Street

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By Roland Head, The Motley Fool

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LONDON — Stock index futures at 7 a.m. EDT indicate that the Dow Jones Industrial Average may open 12 points higher this morning, while the S&P 500 may open up by 0.19%.

Markets in Europe edged higher this morning after U.S. aluminum giant Alcoa beat earnings forecasts and China reported that inflation fell further than expected in March, boosting hopes that the Chinese government will continue its monetary-stimulus efforts. Among the biggest risers were mining shares, which helped lift the FTSE 100 by 0.47% by 7:20 a.m. EDT. In Europe, a new OECD report sounded a warning that Slovenia could soon follow Cyprus into bankruptcy if its banking sector is not recapitalized. In the U.K., new figures showed that exports fell by 2.8% in February, while industrial output rose by 1%. German exports also fell: Exports from Europe‘s biggest economy were down by 1.5% in February, while imports fell by 3.8%.

Today’s U.S. economic reports include the NFIB small-business index for March, which fell from 90.8 in February to 89.5, slightly ahead of expectations of 89.2. At 10 a.m. EDT, wholesale inventories are expected to have risen by 0.6% in February after gaining 1.2% in January. February’s Job Openings and Labor Turnover Survey is also due at 10 a.m. EDT.

Last night Alcoa reported first-quarter adjusted earnings of $0.11 per share on sales of $5.83 billion, beating analysts’ expectations for adjusted earnings of $0.08 per share but missing the $5.88 billion consensus forecast for revenue. Alcoa is widely seen as a predictor for the wider market, and despite the revenue miss, these results have been seen as a ‘beat’ and raised hopes that corporate earnings will be stronger than expected across the S&P 500.

Other stocks that may be actively traded today include J.C. Penney. The retailer’s shares were 8.66% lower in premarket trading this morning after the company announced last night that CEO Ron Johnson will leave the company after less than two years in the post to be replaced by his predecessor, Mike Ullman. J.C. Penney’s stock price has halved since former Apple exec Johnson took control, and his turnaround plan is now widely seen as a failure that has alienated loyal customers without attracting new ones. Iron ore miner Cliffs Natural Resources was also higher in premarket trading following gains for commodity stocks in Europe.

Finally, let’s not forget that the Dow’s daily movements can add up to serious long-term gains. Indeed, Warren Buffett recently wrote, “The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions.” If you, like Buffett, are convinced of the long-term power of the Dow, you should read “5 Stocks To Retire On.” Your long-term wealth could be transformed, even in this uncertain economy. Simply click here now to download this free, no-obligation report.

The article Dow May Open Higher After Alcoa Beats the Street originally …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Dow May Rebound as Japanese Stimulus Takes Effect

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By Roland Head, The Motley Fool

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LONDON — Stock index futures at 7 a.m. EDT indicate that the Dow Jones Industrial Average may open up by 0.28% this morning, while the S&P 500 may open 0.36% higher.

European stock markets have moved modestly higher this morning, recouping some of the losses they suffered after Friday’s disappointing U.S. jobs report. At 7:45 a.m. EDT, the FTSE 100 was up 0.35% and the German DAX was 0.28% higher, but there wasn’t much good news to support a sustained improvement. German industrial production rose by 0.6% in February, but January’s flat reading was revised down to -0.6%, and the year-on-year figure remains negative, down 1.8%. Italy remains without a new government, and Portugal‘s government came under renewed pressure at the weekend after a court vetoed proposed public-sector wage and pension cuts, meaning the cuts will now have to be made through further public-sector service cuts, possibly to health and education.

What support there is for European markets may be a consequence of Japan‘s newly enlarged quantitative-easing program. This morning, the Bank of Japan purchased 1.2 trillion yen of Japanese sovereign bonds with maturities of five years or more, triggering a further fall in the yen, which was trading at 98 to the dollar at 7 a.m. EDT.

In the U.S., the Chicago Fed is scheduled to release its Midwest Manufacturing Index for February at 8:30 a.m. EDT. No other economic reports are due, but tonight sees the start of earnings season, when traditional bellwether Alcoa reports its earnings for the most recent quarter after the closing bell. Expectations are low: The highest of the consensus forecasts is from Thomson Reuters, which is forecasting a 1.6% rise in earnings per share, while FactSet is predicting a 0.6% fall in earnings to $0.08 per share and a 1.6% drop in sales to $5.9 billion. Earnings growth across the S&P 500 has weakened over the last quarter, triggering speculation that the index — which hit new record highs in March — could be due for a correction.

Other companies whose stock may be actively traded today include AZZ Incorporated, which reported quarterly earnings of $0.50 per share this morning, beating expectations for earnings of $0.48 per share. However, AZZ missed revenue expectations, and its full-year guidance shows earnings per share falling below consensus estimates.

Finally, let’s not forget that the Dow’s daily movements can add up to serious long-term gains. Indeed, Warren Buffett recently wrote, “The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions.” If you, like Buffett, are convinced of the long-term power of the Dow, you should read “5 Stocks To Retire On.” Your long-term wealth could be transformed, even in this uncertain economy. Simply click here now to download this free, no-obligation report.

The article Dow May Rebound as Japanese Stimulus Takes Effect originally appeared on Fool.com.

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Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

March's Jobs Report in 4 charts

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By Morgan Housel, The Motley Fool

We are living through the worst employment disaster since the Great Depression. After every monthly jobs report, analysts parse the numbers and pick apart the details, but that one sentence is really all that matters. 

The article

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March’s jobs report showed that a net 88,000 new jobs were added last month and the unemployment rate fell to 7.6% — the lowest level in more than four years.

That was the good news. The bad news is that this is, by most accounts, a dismal result. 

Theoretically, at least. Any given employment report has a margin of error of plus or minus 100,000, and nearly all initial reports are revised in subsequent months. Indeed, March’s jobs report revised January and February’s figures up by 61,000 jobs. One of the only things we are reasonably assured of is that the economy didn’t create 88,000 jobs in March — a truth that never quells the hyperventilating when initial employment reports are released.

To smooth out month-to-month volatility, I look at a rolling six-month average change in monthly jobs:

Source: Bureau of Labor Statistics.

For the last three years, we have created enough jobs to keep up with population growth — maybe a bit more — and that’s about it. There has been almost no deviation from this trend, too. 2011 saw average monthly jobs growth of 175,000. 2012’s average figure was 183,000. In the first three months of 2013 we’ve averaged 168,000. Statistically, these numbers are almost indistinguishable. It has been one of the dullest recoveries on record.

The unemployment rate, however, is in decline — and not just the standard unemployment rate most often cited in the media. The Bureau of Labor Statistics calculates unemployment several different ways, with some measures counting not just the unemployment, but those who have given up looking for work and those working part-time but desiring full-time hours. Importantly, all show the same trend: downward.

Source: Bureau of Labor Statistics.

But this poses a question: If jobs growth is so dull, why is the unemployment rate dropping across the board?

In part because fewer Americans are taking part in the labor force and thus aren’t counted in the unemployment statistics. The labor force participation rate, which counts working-age Americans who either are employed or are unemployed and looking for work, fell in March to the lowest level since the Carter administration:

Source: Bureau of Labor Statistics.

Part of this decline is due to a weak economy. But there’s more to it; the decline clearly began before the recession.

There are three big explanations for why so few Americans are in the labor force:

  • The country is aging.
  • Men have been leaving the labor force consistently for 60 years.
  • More people are in school.

As baby boomers retire, the demographic bulge of those born in the 1950s and 1960s exits the labor force. Demographers predicted a sharp decline in the labor force participation rate years before the recession began. Even if the economy were booming, the labor force participation rate would almost certainly be falling.

Second, men have been leaving the labor force consistently for more than half a century as women …read more

Source: FULL ARTICLE at DailyFinance

News, Politics, Government

The Employment Situation in March

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By Alan B. Krueger

While more work remains to be done, today’s employment report provides further evidence that the U.S. economy is continuing to recover from the worst downturn since the Great Depression. It is critical that we continue the policies that are helping to build an economy that creates jobs and works for the middle class as we dig our way out of the deep hole that was caused by the severe recession that began in December 2007.

Today’s report from the Bureau of Labor Statistics (BLS) shows that private sector businesses added 95,000 jobs last month. Total non-farm payroll employment rose by 88,000 jobs in March. The February and March employment numbers were revised up by a total of 61,000 jobs. The economy has now added private sector jobs every month for 37 straight months, and a total of nearly 6.5 million jobs have been added over that period.

The household survey showed that the unemployment rate fell from 7.7 percent in February to 7.6 percent in March, the lowest since December 2008. The labor force participation rate decreased by 0.2 percentage point to 63.3 percent in March.

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Source: FULL ARTICLE at The White House

Articles of Interest

Paul Krugman: ‘Unemployment, Not Excessive Money Printing, Is What Ails Us’

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By The Huffington Post News Editors

When the Great Depression struck, many influential people argued that the government shouldn’t even try to limit the damage. According to Herbert Hoover, Andrew Mellon, his Treasury secretary, urged him to “Liquidate labor, liquidate stocks, liquidate the farmers. … It will purge the rottenness out of the system.”

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Source: FULL ARTICLE at Huffington Post

Business, Finance, Occupation & Industry

Dow Jones May Drop on Jobs Data

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By Roland Head, The Motley Fool

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LONDON — Stock index futures as of 7 a.m. EDT indicate that both the Dow Jones Industrial Average and the S&P 500 may open 0.6% lower. Despite gains for both indexes yesterday, the CNN Fear & Greed Index fell further and closed at 55 last night, signifying “neutral” sentiment.

Stock markets across Europe fell this morning to reach a one-month low ahead of this afternoon’s U.S. nonfarm payroll data. European airline shares fell amid fears that a bird flu outbreak in China that has already killed six people could harm long-haul business, leaving British Airways owner International Consolidated Airlines Group down by 6.8% at 7:30 a.m. EDT. Concerns also grew that North Korea might threaten U.S. bases in the Asia-Pacific region after it moved missile launchers and intermediate-range missiles to its eastern coastline. At 7:30 a.m. EDT, the FTSE 100 was down 1.4%, while Germany’s DAX was 1.8% lower.

Today’s key economic reports are the nonfarm payrolls and unemployment rate for March, both of which are due at 8:30 a.m. EDT, before markets open. U.S. jobs data has disappointed twice already this week, and consensus forecasts are suggesting that 190,000 new jobs were created in March, down from 236,000 in February. Investors will be concerned that these figures may surprise to the downside once more, although the unemployment rate is expected to remain unchanged at 7.7%. Other data due to be published today includes the trade deficit and consumer credit figures for February.

There are no major corporate earnings announcements due today, but companies with strong domestic exposure such as Bank of America could fall if job figures come in below expectations. Stocks that may be actively traded today include F5 Networks, which fell 17% in German trading this morning after cutting its second-quarter sales and earnings forecasts below its previous guidance. Facebook shares rose 3.1% yesterday as the company launched its new Facebook Home app and its customised Android phone, but the social-networking website’s shares are just 0.5% higher in premarket trading, suggesting that investors may wait to see what impact the new app has on Facebook’s mobile revenue before committing themselves to large new positions.

Finally, let’s not forget that the Dow’s daily movements can add up to serious long-term gains. Indeed, Warren Buffett recently wrote, “The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions.” If you, like Buffett, are convinced of the long-term power of the Dow, you should read “5 Stocks To Retire On.” Your long-term wealth could be transformed, even in this uncertain economy. Simply click here now to download this free, no-obligation report.

The article Dow Jones May Drop on Jobs Data originally appeared on Fool.com.


Roland Head has no position in any stocks mentioned. The Motley Fool recommends F5 Networks and Facebook. The Motley Fool …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

America's 6th-Best CEO Will Give You an Investing Edge

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By Brian Stoffel, The Motley Fool

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Once you get the hang of it, it’s pretty easy to dissect balance sheets, income, and cash flow statements. This is the first step in getting your feet wet in the investment world.

But it doesn’t stop there. If we were to base investing decisions solely on what we read in these statements, that would be akin to picking a significant other based solely on their Facebook profile — to many, it just doesn’t make sense to avoid real-life interaction.

Investigating these “soft” aspects of a company is important for investors. And although we can’t capture all of the intangibles of a company in one article, Glassdoor.com — a website that collects employee sentiment for companies across the world — recently came out with a list that could help: the Top CEOs of 2013.

Over the past few days, I’ve covered CEOs 25 through 7. Today, I’m going to introduce you to the company with the 6th-highest-rated CEO, give you some background on the company, and at the end, I’ll offer access to a special free report that serves up a stock Warren Buffett only wishes he could buy.

US Bank
This won’t be too much of a spoiler, but the list of America’s top 25 CEOs includes three chiefs of some of America’s largest banks. I’ve covered JPMorgan Chase‘s Jamie Dimon — who has taken a precipitous fall from last year’s 12th overall ranking to this year’s 25th. That may be due in part to the London Whale incident that made Dimon’s pleas for looser regulations seem hypocritical.

I also ran down PNC Financial‘s Jim Rohr, who has been with his company since 1972, and was previously named American Banker of the Year in 2007. Sadly for investors, however, Rohr’s tenure will soon be coming to a close.

That leaves us with U.S. Bank’s CEO, Richard K Davis, as the highest rated CEO of a major bank in America. Davis has been with the company since 1993 and has served as CEO since late 2006.

Lessons in prudence from the Great Depression
Taking over a company just before the Great Recession took hold could not have been an easy task, but Davis was probably the best man for the job. According to an interview he gave with Titan Magazine, Davis keenly remembers the lessons his parents taught him from their experience of the Great Depression, such as growing up in Hacienda Heights in a home where the furniture was covered with plastic. He recalls drying the dishes with threadbare tea towels while a couple of dozen new towels languished on the shelf. 

Those lessons came in handy. In the years leading up to the real-estate bubble bursting, “We were routinely criticized for not growing fast enough,” Davis states. But that prudence paid off, as his bank was one of the first to repay the federal government‘s $6.6 billion in TARP funds — accomplishing the feat all the …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Dow May Gain After Japanese Central Bank Doubles QE

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By Roland Head, The Motley Fool

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LONDON — Stock index futures at 7 a.m. EDT indicate that the Dow Jones Industrial Average may open 0.36% higher this morning, while the S&P 500 may open up by 0.4%. Both indexes closed sharply lower yesterday after weaker-than-expected economic data dented investor sentiment and led to a big drop for the CNN Fear & Greed Index, which closed down 13 points at 58.

This morning’s trading is likely to be influenced by the Japanese central bank’s surprise decision to accelerate its bond-buying program and double its monetary base in the next two years. The Bank of Japan said it would expand its balance sheet from $1.43 trillion to $2.86 trillion by March 2015 by doubling its asset purchases, the majority of which will be long-term government bonds. The bank is targeting inflation of 2% to kick-start growth after years of deflation.

In Europe, markets rose ahead of the European Central Bank announcement due later today, although the ECB is expected to leave interest rates unchanged. The eurozone service sector continued to contract in March, according to the Markit eurozone services PMI, which fell to 46.4 in March from 47.9 in February, indicating that the rate of contraction is increasing. In London, the FTSE 100 was 0.17% lower at the time of writing following the Bank of England‘s announcement that it would leave both interest rates and its asset purchase program unchanged this month.

In the U.S., today’s initial jobless claims report at 8:30 a.m. EDT is likely to be closely watched after yesterday’s ADP employment figures came in below expectations. A Reuters survey suggests that 350,000 new jobless claims were made last week, down slightly from 357,000 the previous week. Today’s figures are likely to be seen as a leading indicator ahead of tomorrow’s nonfarm payrolls and unemployment reports. Meanwhile, this morning’s Challenger job-cut report said that layoffs planned by U.S. companies spiked 37% from January to February. However, the cuts were more than offset by planned hiring.

Other economic data due today includes the EIA weekly natural-gas storage report at 10:30 a.m. EDT and the global services PMI at 11 a.m. EDT.

Companies expected to report quarterly earnings before markets open include International Speedway, Jos. A Bank Clothiers, and RPM International. Facebook stock could also be actively traded ahead of today’s much-hyped media launch of a new Android-related product — widely expected to be a Facebook phone. Facebook stock climbed 3.3% yesterday and was 1.2% higher in premarket trading this morning.

Finally, let’s not forget that the Dow’s daily movements can add up to serious long-term gains. Indeed, Warren Buffett recently wrote, “The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions.” If you, like Buffett, are convinced of the long-term power of the Dow, you should read “5 Stocks To Retire On.” Your long-term wealth could be transformed, even in this uncertain …read more

Source: FULL ARTICLE at DailyFinance

Articles of Interest

Obama’s Culture War Will Be His Undoing

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By John Careccia

Hennessey Venom GT

Democratic strategists have always said that elections can be won by espousing gun control, doubting the existence of God, and fighting for Gay rights. They put forward that platform in 2004 and again in 2008. The only difference is that in 2008, they also had George Bush to blame for all the ills the American people were feeling at the time. So Obama and the Democrats promised to pull America from the brink of Depression as long as the government was able to spend $875 billion.

Fast-forward to the third month of President Obama’s second term. Suddenly, the Democrats’ stance is not looking so good anymore. It’s not hard to see why they’re changing gears to fight a culture war of their own choosing.

They promised the economy would rebound in 4 years. The U.S. economy is still suffering through the weakest economic recovery since the Great Depression. In some areas of the country, they are still suffering the effects of the recession. Unemployment is stubbornly high, especially for Black Americans and others age 25 to 54, who make up the core of the nation’s would-be workforce. All of the polls show that the American public does not approve of Obama’s bumbling and ineffectual attempts to handle the economy.

Obama’s signature domestic accomplishment, the Affordable Healthcare Act (Obamacare), is becoming more and more unpopular as the many parts of the law are exposed for the burdens they are. Health care premiums are rising fast, as its opponents predicted and the CBO confirmed; and now even the Nanny Press is being forced to highlight how the law is either discouraging new hiring altogether or forcing more Americans to accept part-time work to stay employed. The key component of the law, the state-based insurance exchanges, are supposed to be up and running in just over seven months; and no one at the state level believes they will be functioning properly. Many states have chosen not to fund the changeover. In the words of the federal bureaucrat in charge of implementing the exchanges, “I am no longer trying to make these exchanges provide a ‘world-class experience,’ but instead merely hoping they won’t provide ‘a Third World experience.’” Suddenly, guns, God, and gays are looking better and better to Democratic strategists.

On Saturday, Obama devoted his weekly radio address to proposed new gun control laws (including background checks, which everyone agrees would not have prevented the tragedy in Newtown) and the restoration of a demonstrably ineffective assault weapons ban that expired in 2004. None of this will do anything to attack the true cause of senseless slaughter and mass shootings. It is not the tool, but the person using the tool that needs to be addressed. Given that nearly all gun violence is perpetrated with handguns — not long guns and not so-called “assault weapons” — it is evident that Obama’s new focus on guns is designed not so much to prevent gun deaths, but rather to energize Nanny-driven Democratic voters who look down their noses at gun …read more
Source: FULL ARTICLE at Western Journalism

Business, Finance, Occupation & Industry

Dow May Gain on Economic Reports

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By Roland Head, The Motley Fool

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LONDON — Stock index futures at 7 a.m. EDT indicate that the Dow Jones Industrial Average may open a nominal five points higher this morning, while the S&P 500 may open up by about one point.

European markets slipped lower this morning ahead of today’s U.S. economic reports. At 7:15 a.m. EDT the FTSE 100 was down 0.44%, dragged lower by a broad sell-off of mining stocks and a 1.9% fall for telecom firm Vodafone after Verizon denied yesterday’s rumor that it is putting together a bid for the firm in conjunction with AT&T. In the eurozone, inflation fell from 1.8% to 1.7%, while the International Monetary Fund suggested that additional taxation measures may be necessary for Cyprus to meet the terms of its 10 billion euro bailout. Investors may remain cautious ahead of tomorrow’s meeting of the European Central Bank and Bank of England policy committees, at which potential changes to current monetary-easing programs may be discussed.

The ADP private-sector payroll data for March will be released at 8:15 a.m. EDT. The measure is seen by some as a lead indicator ahead of this Friday’s key nonfarm payrolls report, and consensus forecasts suggest that 192,000 new jobs may have been created in the private sector in March, down slightly from 198,000 in February. Today’s other main data item is the ISM nonmanufacturing index for March, due at 10 a.m. EDT. Analysts’ forecasts suggest that the nonmanufacturing index may drop slightly to 55.8, down from 56 in March. However, the ISM manufacturing index came in below expectations on Monday, so investors may be cautious ahead of this report.

Two major earnings reports are due before markets open today, with both ConAgra Foods and agricultural giant Monsanto set to update the markets. ConAgra is expected to report third-quarter earnings of $0.56 per share, while Monsanto is expected to post second-quarter earnings of $2.56 per share, according to analysts’ consensus forecasts. Other companies due to report before the opening bell include Acuity Brands, Conns, and Schnitzer Steel Industries.

Tesla may also continue to be actively traded ahead of the “big announcement” promised today by founder Elon Musk. Last night, the electric-car maker said it would be partnering with Wells Fargo to create a financing package aimed at improving the affordability of its electric-car models. Meanwhile, online-gaming company Zynga could be one of the day’s biggest climbers after it said last night that it would introduce real-money online gambling in the U.K. Zynga shares were 12% higher in premarket trading.

Finally, let’s not forget that the Dow’s daily movements can add up to some serious long-term gains. Indeed, Warren Buffett recently wrote: “The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions.” If you, like Buffett, are convinced of the long-term power of the Dow, you should read “5 Stocks to Retire On.” Your long-term wealth could …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Dow to Rise as BGC Partners Soars on Nasdaq OMX Deal

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By Roland Head, The Motley Fool

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LONDON — Stock index futures at 7 a.m. EDT indicate that the Dow Jones Industrial Average may open 0.39% higher this morning, while the S&P 500 may open up by 0.42%.

European stock markets rose strongly this morning when they reopened after a four-day holiday weekend. The FTSE 100 was one of the biggest risers, up 1.1% at 7:25 a.m. EDT, with telecom firm Vodafone topping the leaderboard with a 5.1% gain. Vodafone has been the subject of a number of recent rumors relating to the sale of its 45% stake in Verizon Wireless, but today’s gains were prompted by a more detailed report in the Financial Times suggesting that Verizon and AT&T could be preparing a 260 pence per-share breakup bid for the firm.

This morning’s European gains were achieved despite disappointing data showing that manufacturing contracted in all major EU economies in March, including Germany, where the Markit manufacturing PMI dropped from 50.3 to 49 last month. Eurozone unemployment hit a new record of 12% in March, leaving it 1.1% higher than one year ago. Spain admitted that it would need more time to hit its budget deficit reduction target, while in Cyprus, the country’s stock exchange reopened after a two-week closure, and the government said it would relax the capital controls that were put in place last week, allowing larger transfers of money to foreign accounts.

In the U.S., today’s economic reports include February’s factory orders, due at 10 a.m. EDT. Consensus forecasts suggest that factory orders rose by 3% in February after falling by 2% in January. The latest motor-vehicle sales figures are also expected through the day, and analysts are forecasting a decline in total sales from 15.4 million to 15.3 million.

It’s a quiet day for corporate earnings, but earlier this morning spice maker McCormick reported earnings per share of $0.57 on net sales of $934 million for the first quarter of its 2013 fiscal year. The firm also confirmed its 2013 outlook for 3% to 5% sales growth and full-year EPS of between $3.15 and $3.23. BGC Partners could be the day’s biggest mover — the company’s stock gained 40% in premarket trading after Nasdaq OMX agreed to buy BGC‘s bond-trading platform for $750 million in cash. Dow constituent Hewlett-Packard fell 3.4% in premarket trading after Goldman Sachs downgraded the company’s shares to “sell.”

Finally, let’s not forget that the Dow’s daily movements can add up to serious long-term gains. Indeed, Warren Buffett recently wrote, “The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions.” If you, like Buffett, are convinced of the long-term power of the Dow, you should read “5 Stocks to Retire On.” Your long-term wealth could be transformed, even in this uncertain economy. Simply click here now to download this free, no-obligation report.

The article Dow to Rise as BGC Partners Soars …read more
Source: FULL ARTICLE at DailyFinance