Mish's Global Economic Trend Analysis |
- David Stockman's "Contra Corner" Website Up and Running; Yellenomics and Pentagon's Swamp of Waste
- High Frequency Trading Hails its First Billionaire
- Wholesale Sales Unexpectedly Decline (Most in Nearly Five Years), Inventories Unexpectedly Rise
- Missing in Action: Where are the Jobs and the Job Seekers?
David Stockman's "Contra Corner" Website Up and Running; Yellenomics and Pentagon's Swamp of Waste Posted: 11 Mar 2014 11:29 PM PDT A couple days ago I added a feed to David Stockman's "Contra Corner" on the right hand side of this blog. As of today, his site is officially "live". Stockman's First Two Live Posts I am pleased to be a part of "Contra Corner" along with 15 others, most of whom I recognize. Please give his site a good look. Stockman Bio Dave Stockman is the author of The Great Deformation: The Corruption of Capitalism in America and the Triumph of Politics: Why the Reagan Revolution Failed. He has served on various corporate boards of directors and as Managing Director of The Blackstone Group. He also served as Director of the Office of Management and Budget under President Reagan. Stockman at Wine Country Conference II Want to hear a live discussion of what Stockman thinks is the endgame of crony capitalism? Then come to the second annual Wine Country Conference which will be held May 1st & 2nd, 2014. We have an exciting lineup of speakers for this year's conference.
In addition, we expect confirmation from a number of other highly respected fund managers and speakers. This year's event is two days and will include additional "break-out" groups. For speaker bios, please check out Wine Country Conference Speakers. This Year's Cause: Autism $100,000 of the money raised last year came from a generous matching grant from the John P. Hussman Foundation. Some of us in the industry who have done well are making an effort to help others. John Hussman is at the very top of that list. One of John's kids has severe autism. This year, all net proceeds will go to support autism programs. Conference Details For further details about the 2014 conference, please see Wine Country Conference May 1st & 2nd, 2014 Nothing Like It! This event is not just another "come and hear someone talk" kind of thing. Attendees and their significant others can expect an educational, fun, and relaxed time. Last conference, we arranged wine tours. They were a big hit. We will do so again. One of the wine estates we visited had a Bocce Ball court. On a couple of miracle shots, I won both games I played. Stay an extra day and golf or travel. I did. The conference hotel is a fun place in and of itself. Unlike many other conferences, you will have easy access to speakers. Want to chat with me, Dave, Steen, John, or anyone else at the conference? You will have an easy chance. Not only do we have an excellent lineup of speakers, you will have an opportunity to meet with them, have intimate discussions on important investment topics, with a lot of fun on the side, including wine tours and great wine. There's nothing like it in the investment business. And your money goes to a great cause! What can be better? Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com | |||||||||||||||||||||||||||||||||||||||||||||
High Frequency Trading Hails its First Billionaire Posted: 11 Mar 2014 12:52 PM PDT Vincent "Vinnie" Viola, the founder of Virtu Financial Inc, is High Frequency Trading's (HFT) first billionaire. He has an impressive track record of just "one losing trading day" during a 1,238 trading-day period. How does he do it? The same way other High-Frequency do it: front running trades and scalping countless billions and billions of fractions-of-pennies in the process. Before discussing the first HFT billionaire, let's post some background for those who are not familiar with the process. What Is HFT? Wikipedia reports ... High-frequency trading (HFT) is a type of algorithmic trading, specifically the use of sophisticated technological tools and computer algorithms to rapidly trade securities. HFT uses proprietary trading strategies carried out by computers to move in and out of positions in seconds or fractions of a second. Firms focused on HFT rely on advanced computer systems, the processing speed of their trades and their access to the market.Great Time to IPO With overall profits declining, and risk of taxation or banning rising rapidly, what better time than now to cash out via an IPO? Meet Vinnie Viola Image from New York Times With that backdrop, please consider the New York Times article Virtu IPO Poised to Make a (Multi-)Billionaire of Vinnie Viola. High-frequency trading could soon officially mint its first billionaire.Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com | |||||||||||||||||||||||||||||||||||||||||||||
Wholesale Sales Unexpectedly Decline (Most in Nearly Five Years), Inventories Unexpectedly Rise Posted: 11 Mar 2014 10:54 AM PDT Once again the weather is at play as economists still have not figured out it was cold in January. Then again, perhaps something else is at play, such as the economy is cooling and the economists still don't see it. Yahoo!Finance reports U.S. Wholesale Inventories Rise, but Sales Drop Sharply. U.S. wholesale inventories rose more than expected in January, as companies built up stocks of autos and machinery, though sales posted their largest decline in nearly five years.Census Report on Wholesale Trade Let's go straight to the monthly Census Report on Wholesale Trade for a closer look. Sales. The U.S. Census Bureau announced today that January 2014 sales of merchant wholesalers, except manufacturers' sales branches and offices, after adjustment for seasonal variations and trading-day differences but not for price changes, were $432.6 billion, down 1.9 percent (+/- 0.5%) from the revised December level, but were up 3.9 percent (+/-1.2%) from the January 2013 level.Sales Inventory The key inventory rise is in autos. But also note the year-over-year rise in durable goods in general, nearly across the board. Of course sales are up as well, but if a sales slump happens for any reason, inventories will be way out of line. Is this all weather related? I suspect not. Future reports will tell, but as is typically the case, some sort of snapback in the next report or two is expected. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com | |||||||||||||||||||||||||||||||||||||||||||||
Missing in Action: Where are the Jobs and the Job Seekers? Posted: 11 Mar 2014 12:48 AM PDT The EPI had an interesting chart and comments in its report The Vast Majority of the 5.8 Million Missing Workers Are Under Age 55. Since the start of the Great Recession over six years ago, labor force participation has dropped significantly. Most of the drop—roughly three-quarters—was due to the lack of job opportunities in the Great Recession and its aftermath. There are now 5.8 million workers who are not in the labor force but who would be if job opportunities were strong.Core 25-54 Age Group I like the above idea but a chart that shows changes over time would be better. Also, let's take out those under the age of 25 to see trends in the core 25-54 age group. In general, those in age group 25-54 should be working, not retired, and not still in school. Reader Tim Wallace, who somehow I neglected to mention in my Word of Thanks post on Sunday, once again provides the chart. I added this addendum today: "A huge word of thanks to reader Tim Wallace who has provided countless charts on labor force, demographics, and energy." Thanks Tim! Age 25-55 Employment Data click on chart for sharper image
Since February 2007....
The loss in employment in the core 25-54 age group is a whopping 5,183,000. Factoring in the decline in population, that is an excess job loss of 4,076,000! The labor force should have declined by 1,107,000. Instead, it declined by 3,256,000. That is an excess labor force decline of 2,149,000. Calculating a More Realistic Unemployment Rate Here are the figures from the Latest Jobs Report. (Numbers in Thousands) To calculate an more realistic unemployment rate, all we need to do is adjust the labor force then run the math. Adding 2,149,000 back to the labor force we get 157,873,000. The number of employed is 145,266,000 as shown above. The ratio of employed to the labor force is 92.01 percent. Via the above method, the unemployment rate would be 7.99 percent, not the 10 percent calculated by the EPI. Regardless, 7.99 percent is way higher than the reported 6.7 percent. Moreover, that 7.99 percent unemployment rate assumes everyone else who dropped out of the labor force either retired or is genuinely disabled (an admittedly ridiculous assumption, yet one that makes things seem better that they are). Taking other age groups into consideration, I estimate the true unemployment rate (not counting part-time employment) is somewhere between 8.5 and 9 percent. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com |
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