Mish's Global Economic Trend Analysis |
- Spain's Unemployment Rate Increases to 23.7%; 114,300 Jobs Vanish in First Quarter, Public Sector Jobs Rise
- Kansas City Fed Manufacturing Report: Nearly a Clean Negative Sweep; US Dollar Effect in Spotlight
- New Home Sales Down 11.4% Overall, 15.8% in South; Median Price Declines
- Seven Year Negative Returns in Stocks and Bonds; Fraudulent Promises
| Posted: 23 Apr 2015 03:28 PM PDT The economic recovery in Spain has gone from jobless to jobloss. Spain shed 114,300 jobs in the first quarter of 2015. Via translation from El Pais, Spain's Unemployment Rate Rose Slightly in the First Quarter. The economic recovery has not been enough to create jobs. In the first three months of the year, the economy shed 114,300 jobs. The result has been a slight increase in the unemployment rate from 23.7% to 23.78% according to the Labour Force Survey (EPA) published by the National Employment Institute. The rise in unemployment could have been higher if not for the significant decline in the labor force. This group has fallen by 127,400 people to 22.9 million. As was the case in the previous quarter, again, the labor kick is a decline in private employment (143,500), since the public has grown to 29,200 jobs. Spain Unemployment Rate  Key Points
Those are horrific numbers. The unemployment rate would be higher except for a decline in the labor force coupled with public sector hiring (likely an election ploy given national elections this Autumn). The only way Spain can grow and hit budget deficit targets is via numbers like these. In fact, I strongly suspect Spain will miss its budget deficit target because of public sector spending. How long before Spanish citizens have had enough? The next national election may be telling. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com |
| Kansas City Fed Manufacturing Report: Nearly a Clean Negative Sweep; US Dollar Effect in Spotlight Posted: 23 Apr 2015 10:27 AM PDT Inquiring minds are digging into the Federal Reserve Manufacturing Report for the 10th District Region. 10th District Summary  Note the near clean sweep in the negative sense. Actually, inventories of materials rising in the midst of a decline in orders is not a good thing either. New orders, backlog of orders, employment, and length of workweek have all crashed. Prices paid and received are deflationary. US Dollar Effect in Spotlight Effect of the strength of the US dollar is notable in the comments
Comments number two, three, and nine are telling. Recession? I stick with my assessment made in January and commented on twice recently. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com |
| New Home Sales Down 11.4% Overall, 15.8% in South; Median Price Declines Posted: 23 Apr 2015 08:58 AM PDT The Bloomberg consensus estimate for new homes sales was an overly-optimistic 518,000. Instead, it's bad news again as new home sales fell a very steep 11.4 percent to a 481,000 annual rate.
New Home Sales in Thousands  The Northeast contributes the least. The South contributes the most followed by the West so weather is not a significant factor. Above New Home Sales table from Census.Gov. Single Family Home Sales  Everyone seems to expect a return to the bubble years even though it's pretty clear where the range really belongs. Demographically speaking, as boomers age, their houses will add to existing supply as they downsize, then pass away. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com |
| Seven Year Negative Returns in Stocks and Bonds; Fraudulent Promises Posted: 23 Apr 2015 12:05 AM PDT It is extremely refreshing to see a large, prominent, and historically accurate fund manager lay it on the line. GMO does that quarter after quarter, with no-nonsense projections. As of March 31, their 7-Year Asset Class Real Return Forecast is as follows.  Serious Question for Pension Plans Given pension plan assumptions of 7-8% annualized returns how many of them can survive negative returns for seven years? It's important to note that GMO is talking about "real" inflation-adjusted returns with an assumption of mean-reversion inflation to 2.2% over 15 years. Still, that leaves US equities at zero to -1% returns and US bonds at negative 2.4% returns. Even if GMO is wrong by say 3%, many pension plans will be in deep serious trouble at those returns. Illinois Pension Plans I keep harping about this issue, but it's an important one. In the state of Illinois, and in spite of an enormous rally in the stock market since 2009, Illinois pension plans are only 39% funded. A "Special Pension Briefing" last November, shows the Illinois State Retirement Systems are in dismal shape. Unfunded Liabilities
The above numbers show actuarial (smoothed) asset valuations. Liability Trends - Not Smoothed  In spite of the massive stock market rally, Illinois liabilities increased every year since 2011. For still more details, please see Illinois Pension Plans 39% Funded; Taxpayers On the Hook for $105 Billion in Liabilities; It Will Get Worse!. Any notion that pension shortfalls can be balanced on the backs of Illinois taxpayers needs to vanish now. How did Illinois plans became so underfunded? In general, by promising far more than can possibly be delivered. Summary of Liabilities and Unfunded Ratios  click on any chart for sharper image Congratulations go to the Illinois General Assembly Retirement System (GARS) for having one of the worst, (if not the worst) pension plan in the entire nation. It is 16% funded. No doubt, that increases the pressure of the General Assembly to put the burden of bailing out the system on the backs of Illinois taxpayers. Fraudulent Promises Pension promises were not made in good faith. Rather, pension promises were the direct result of coercion by public unions on legislators, mayors, and other officials willing to accept bribes because they shared in the ill-gotten gains of backroom deals at taxpayer expense. Illinois taxpayers cannot be held accountable for coercion of public officials by public unions. Fraudulent promises will be held "null and void" in any "non-stacked" court of law in the nation. Given the 31% funding of the Illinois Judicial Pension Plan (JRS), the sorry state of Illinois pensions is likely headed to federal courts. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com |
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Temperatures hit 66.1°F on the first official day of Google's Mobile Update (the system is tuned to an average of 70°F). Of course, the problem is that this system only measures desktop temperatures, and as we know, Google's Mobile Update should only impact mobile SERPs. So, we decided to build a MozCast Mobile, that would separately track mobile SERPs (Android, specifically) across the same 10K keyword set. Here's what we saw for the past 7 days on MozCast Mobile: 
I'm using raw flux data here, since the temperature conversion isn't calibrated to this data. This comparison is tricky, because many sites use different URLs for mobile vs. desktop. I've stripped out the obvious cases ("m." and "mobile." sub-domains), but that still leaves a lot of variants. 
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