miercuri, 23 octombrie 2013

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis

Workforce, Population, Jobs by Age-Group

Posted: 23 Oct 2013 07:53 PM PDT

Here are a few demographic-related charts of the workforce, civilian non-institutional population, and jobs, by age-group, from reader Tim Wallace.

Change in the Number of Jobs Since 1970



Civilian Non-Institution Population Since 1970



Workforce Since 1970



Percent of Population in Workforce Since 1970



Number in Age Group Employed



Percent of Age Group Employed Since 1970



Wallace writes ...

Mish,

The attached charts are eye openers.

Graph 1 Comments

The first chart shows the change in the number of jobs and the population since 2007. It shows us that in the 16-19 age group the population has shrunk by 239,000, while the number of jobs in this age group has shrunk by 1,415,000! In the 20-24 age group the population has grown by 1,625,000 while the number of jobs has shrunk by 362,000. For the under 25 age group we have 1,777,000 less jobs with 1,386,000 more people.

In the 25-54 age group that everyone always focuses on, we see a loss in population of 1,382,000 people since August of 2007, but an even greater loss in jobs - 5,940,000! Add to this the loss of 1,777,000 up above and we see the 16-54 age groups have lost 7,717,000 jobs since 2007. And, the population has basically been flat.

Since 2007 we have added 13,745,000 people to the population over age 55. We have also added 5,820,000 to the number employed in that age bracket.

Jobs were lost in every age bracket except the 55+, with 16-19 dropping 22.6%, 20-24 falling 2.6%, 25-54 going down 5.9% and 55+ going UP 22.7%!

Graph 2 Comments

The second graph shows the Civilian Non-Institutional Population by age - note the basic flat lines on all but 55+. The graph shows the Work Force by age - note once again only 55+ goes up.

Graph 4 comments

The fourth graph shows the number employed by age group. Note that only the 55+ group benefited in the current "Recovery". The other groups are all down from 2007, with 16-19 devastated. Just go in Walmart and McDonald's and you will see it first hand - senior citizen workers abound.

Graph 5 comments

The fifth graph shows the percentage of an age group that is employed. The percentage plunged in every age group except 55+.

Graph Six Comments

The last graph shows the percentage of the age group employed. It follows the exact trend of the fifth, as it must.

Those in sales and marketing you should focus on the 55+ age group. Forget the teenagers, they are contributing little, and their parents are sliding fast! Those in the 20-24 hope the  55+ start to retire, but in increasing percentages, they choose not to

Very interesting data, thanks to the BLS for giving us access to the ranges in the data base.

As usual, all data not adjusted for seasonality, just direct comparisons of actual data year on year.

Tim

The charts show something I have repeatedly said since 2008: "kids will be competing with their parents and grandparents for jobs that do not pay a living wage."

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com 
Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Germany Accuses US of Spying on Merkel’s Phone; Merkel Phones Obama; Why Should Any Country Trust the US?

Posted: 23 Oct 2013 02:19 PM PDT

The Wall Street Journal reports Berlin Says U.S. May Be Spying on Merkel's Phone
BERLIN—Germany said it believed U.S. intelligence may be spying on Chancellor Angela Merkel's cellphone, an intrusion that it said would constitute a "grave breach of trust" between the longtime allies.

Ms. Merkel called President Barack Obama on Wednesday and made clear that such surveillance among allies would be "fully unacceptable," her spokesman, Steffen Seibert, said in a statement released late Wednesday evening in Berlin.

Mr. Seibert said Ms. Merkel expected U.S. agencies to explain their overall surveillance practices against Germany, "questions that the German government asked months ago."
Merkel Phones Obama

The Spiegel Online reports Berlin Complains: Did US Tap Chancellor Merkel's Mobile Phone?
German Chancellor Angela Merkel phoned United States President Barack Obama on Wednesday to discuss suspicions that she may have been targeted by US intelligence agencies for years, SPIEGEL has learned.

The chancellor asked for a thorough explanation of serious indications that US intelligence agencies had declared her private mobile phone to be a target in their operations.

She "unequivocally disapproves" of such methods and finds them "totally unacceptable," her spokesman Steffen Seibert said. "This would be a grave breach of trust," he added. "Such practices must immediately be put to a stop."

The unusually strong reaction from the Chancellery was prompted by SPIEGEL research. After the information was examined by the country's foreign intelligence agency, the Federal Intelligence Service (BND), and the Federal Office for Information Security, Berlin seems to have found their suspicions plausible enough to confront the US government.

During her conversation with Obama, Merkel expressed her expectation that "US authorities would provide an explanation about the possible extent of such surveillance practices, and thus answer questions that the German government already posed months ago," Seibert said.

"As a close ally of the United States of America, the German government expects a clear contractual agreement on the activities of the agencies and their cooperation," he added.

In response to the allegations, a spokeswoman for the US National Security Council told SPIEGEL: "The President assured the Chancellor that the United States is not monitoring and will not monitor the communications of Chancellor Merkel."

The spokeswoman did not wish to specify whether this statement applied to the past.
Thank Whistleblower Snowden

We should all thank whistleblower Edward Snowden for many of the spying revelations now coming to light. I think he is a hero.

Unfortunately, as I noted in Hypocrites and Bullies Speak on "The Importance of Trust" president Obama and numerous bullies don't see it that way.
Hypocrites and Bullies

  1. Gen. Martin Dempsey, chairman Joint Chiefs of Staff 
  2. Rep. Mike Rogers, Head of the House Intelligence Committee,
  3. Sen. Robert Menendez, chairman of the Senate Foreign Relations Committee

I would like to point out to all three gentlemen one important fact: Edward Snowden did not undermine trust.

There was no trust to undermine. All Snowden did was prove the obvious.

If there was any trust the US would not have been bugging the offices of the EU and Germany. If there was any trust, France would not be spying on us.

Bullies, Bribes, and Foreign Aid

Please note the bullying by US imperialists. Rep. Mike Rogers (R) proposes "to send a very clear message that we won't put up with this kind of behavior."

Excuse Me! What about unconscionable spying by the US on its alleged allies?

Countries should send a very clear message to the US that they will not put up with our severely misguided imperialism. And they probably would except they fear the US might cut off aid.

If you are looking for a reason very few countries have offered Snowden asylum (see Venezuela, Nicaragua offer asylum to Snowden; Double Standards and Hypocrite Allies), you now have an answer.

Thus, we can all thank Rogers for explaining that US foreign aid is really nothing but bribery so the  imperialists, war-mongers, and hypocrites can continue their ways with impunity, totally clueless they are the ones directly responsible for the undermined trust.
Question of Trust

Why Should Any Country Trust the US? They shouldn't, and the US is to blame, not Snowden. Is this about to matter? Let's hope so.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Measuring What Didn't Happen: Did Obamacare Cause an Increase in Part-Time Jobs? No Says Ritholtz, and Reuters; Yes, Says Mish

Posted: 23 Oct 2013 11:39 AM PDT

A friend sent me an article in Reuters today that claims Little evidence yet that Obamacare costing full-time jobs.
One in five businesses in the service sector think President Barack Obama's signature healthcare reform has hurt employment at their firms over the last three months, a National Association of Business Economics survey showed on Monday.

But there is little discernible impact in the employment figures released in recent months, including the September numbers out on Tuesday. The number of people with part-time jobs who want full-time work, for example, was essentially flat in September at 7.9 million.

The number of part-time workers spiked in 2008, well before Obamacare was enacted, and has been slowly falling as a share of total employment since 2010. In September people working part time because they could not find full-time work made up 5.5 percent of the employed, unchanged from August. The spike in 2008 and the steady drift downward since then suggests the elevated level of part-time workers is more likely due to the economy's weakness.
Did Obamacare Cause an Increase in Part-Time Jobs?

Barry Ritholtz at the Big Picture Blog says "no" in his October 7 post Did Obamacare Cause an Increase in Part-Time Employment?
A reader emailed the following question about this weekend's WaPo column (ObamaCare: Investing Advice for Senator Ted Cruz):

"How can you make investment decisions about future returns in light of Obamacare driving so many workers to part time status?"

Ahhh, a classic bit of misdirection — an assumption built into a question. The first step in answering that is to verify the reality of that assumption: Has Obamacare actually caused an increase in part-time employment?

As you can see in the black line below, the number of part time workers spiked because of the Great Recession. It peaked and began to slowly reverse before the ACA [Affordable Care Act - Obamacare] was even passed.



No, there does not appear to be an increase caused by Obamacare.
Measuring What Didn't Happen

For now, let's assume the above chart from the Economic Policy Institute is correct. Does that imply there was no Obamacare effect?

Of course not, and Ritholtz should know better.

Even if the EPI chart is correct, it does not show what would have happened had Obamacare not passed.

Realistically, to determine the Obamacare effect, we need to measure what we didn't see (which is what would have happened in the absence of Obamacare).

I am inclined to believe what corporate CEOs are saying given strong evidence they did what they said.

Reuters reported "Many businesses polled by the NABE said they were holding back on hiring due to the costs imposed by the law. The survey also showed 15 percent of service sector firms planned to shift to more part-time workers due to Obamacare."

There is massive evidence that businesses increased part-time hiring due to Obamacare. There is massive evidence of other economic distortions as well.

Obamacare Economic Distortion Synopsis



  • October 10, 2012: Prepping for Obamacare, Olive Garden and Red Lobster Cut Workers' Hours; Are Other Companies Doing the same?
  • October 20, 2012: Mish Obamacare Mailbag: Expect More Part-Time Jobs
  • February 02, 2013: Obamacare in Action: Retail Workweek Hits 3-Year Low
  • February 19, 2013: Opting Out of Obamacare (the Unaffordable Health Care Act); Not Even Labor Unions Want It
  • May 3, 2013: Obamacare Affects Part-Time Employment Yet Again; Nullification Bill Passes South Carolina House; Analysis of Healthcare Penalty Rates
  • May 20, 2013: Obamacare Premiums 47% Higher But Deductibles 27% Lower Than Grandfathered Health Plans; Obamacare Lies
  • June 21, 2013: Obamacare Effects Hit Local Governments, Small Businesses, Temp Staffing Agencies; Chicago Dumps Retirees Into Obamacare
  • July 8, 2013: Trends in Full and Part-Time Employment; Obamacare Job Double Counting and Other Economic Distortions
  • July 12, 2013: "Win-Win" Situation for Employers to Not Offer Healthcare to Part-Time Employees; Now Ain't That Special?


    • OK Mish, Why Doesn't the EPI Chart Support Your Case?

    1. Perhaps the Obamacare distortions were masked over by other hiring trends.
    2. Perhaps the BLS data will be revised away later, showing what really happened.
    3. Perhaps the assumption we made earlier, "the EPI chart show by Ritholtz is an accurate reflection of the current state of affairs", is in fact, a bad assumption.


    Let's explore point number three. Please consider a chart of BLS data, taken from the St. Louis Fed (Fred) Website.

    Employed, Usually Work Part Time 2000-2013



    Let's hone in on that for a closer look.

    Employed, Usually Work Part Time 2008-2013



    Questions and Answers

    Q.What would the chart look like without Obamacare?
    A. Better

    Q. Was the Obamcare hiring effect delayed until 2012?
    A. Probable. That is when CEOs started complaining. That is when numerous restaurants cut back hours.

    Q. Will we see BLS revisions that make the reported data look worse?
    A. Probable

    Q. Does the Economic Policy Institute chart reflect reality?
    A. The chart from the St. Louis Fed is a closer approximation, but revisions are likely

    Q. Has Obamacare actually caused an increase in part-time employment?
    A. Absolutely.

    That is what the chart suggests (even before expected BLS revisions). That is what CEOs say. And that is what plain common sense suggests in the first place (even though we will not understand the full impact for years, if ever).

    Mike "Mish" Shedlock
    http://globaleconomicanalysis.blogspot.com
    Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

    ECB President Mario Draghi Announces New Stress Tests; Translating "Draghize"

    Posted: 23 Oct 2013 08:06 AM PDT

    When it comes to stress tests, especially for European banks, the one thing history suggests is the tests will be essentially stress-free, by design. Why should this time be any different?

    Nonetheless, European Central Bank President, Mario Draghi Says ECB Won't Hesitate to Fail Banks in Stress Tests.

    Translating Draghize

    For those of you who do not speak Draghize I offer these translations.

    Draghize: "Banks do need to fail to prove the credibility of the exercise".
    Mish: We are carefully scrutinizing several non-critical banks, looking for a couple of scapegoats, hoping to fool the public regarding the credibility of the exercise.

    Draghize: "If they do have to fail, they have to fail. There's no question about that."
    Mish: If any big banks are in trouble. They won't fail. There's no question about that. 

    Draghize: "The test is credible because the ultimate purpose of it is to restore or strengthen private sector confidence in the soundness of the banks, in the quality of their balance sheets"
    Mish: The test is credible because we say it is.

    ECB Executive Board member Joerg Asmussen: "This is our third and last chance to restore confidence after two previous stress tests by the EBA failed to do so."
    Mish: We are praying this stress test does not blow sky high as fast as the last two did.

    Draghize: "The region's governments will be ready to fill any capital holes that emerge as a result of the stress tests."
    Mish: The region's governments are totally unprepared to fill any capital holes that emerge as a result of the stress tests. 

    Draghize: "I have no doubt whatsoever that backstops will be there - - which doesn't mean that they will have to be used because first and foremost it's private money that needs to be used. There's an explicit commitment to have in place proper, adequate national backstops by the time the exercise is being carried out."
    Mish: Bondholders will not suffer as a result of any capital shortages in our hand-picked failures. If anyone needs to suffer, it will, as usual, be taxpayers.

    Draghize: "A substantial amount of private capital has been raised so we're not starting from scratch but certainly, it's the beginning of a new way of doing things."
    Mish: We are starting from scratch. Private capital is inadequate. This is of course why the tests must essentially be stress-free.

    To help explain why there will not be any capital shortfalls, please see New Rules for Italy Banks "I'll Guarantee Your Derivatives If You Guarantee Mine"

    Mike "Mish" Shedlock
    http://globaleconomicanalysis.blogspot.com
    Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.
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