Central Perk

vineri, 9 martie 2012

Mish's Global Economic Trend Analysis

Another Plunge in 3-Month Rolling Average of Petroleum and Gasoline Usage
Greece "Credit Event" Triggers $3B in CDS Contracts; Wolfgang Schäuble Issues Another Warning to Greece; Eurozone Exit Trigger Is Cocked
Euro Sell the News Round-Trip
Nonfarm Payroll +227,000 ; Unemployment Rate Steady 8.3%; BLS vs. Gallup

Another Plunge in 3-Month Rolling Average of Petroleum and Gasoline Usage

Posted: 09 Mar 2012 11:19 PM PST

The following chart shows U.S. petroleum and gasoline usage for December-February compared with the same three months in prior years. Chart is courtesy of reader Tim Wallace.

Note that petroleum usage is back to December 1995 thru February 1996 levels. Gasoline usage is back to December 2001 thru February 2002 levels.

click on chart for sharper image

All data derived directly from the Data 10 section of the EIA download.

The daily average of each week in the listed month adds to the monthly total. Some months have four weeks others five, but over three months this tends to average out.

Contrary to popular belief, the decline in gasoline usage has little or nothing to do with cash-for clunkers or improved gas mileage in cars unless one fantasizes that gas mileage improvements started precisely in 2007.

Wallace comments "If this trend lasts for the rest of the year, Obama's stated goal of a 15% reduction in greenhouse gases based off 2005 numbers may be met this year instead of his 2015 goal."

Should that happen, I wonder how many will be happy with the economic result.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

Greece "Credit Event" Triggers $3B in CDS Contracts; Wolfgang Schäuble Issues Another Warning to Greece; Eurozone Exit Trigger Is Cocked

Posted: 09 Mar 2012 01:09 PM PST

At long last the ISDA has agreed that Greece in in default, and that default constitutes a "credit event".

Bloomberg reports Greece Deal Triggers $3B in Default Swaps.

Greece's use of collective action clauses forcing investors to take losses under the nation's debt restructuring will trigger payouts on $3 billion of default insurance, the International Swaps & Derivatives Association said.

A total 4,323 credit-default swap contracts can now be settled after ISDA's determinations committee ruled the use of CACs is a restructuring credit event. Before the ruling, Greek swaps rose to a record $7.68 million in advance and $100,000 annually to insure $10 million of debt for five years.

The decision was unanimous, New York-based ISDA said today in a statement distributed by Business Wire. An auction to set the size of the payouts will be held on March 19.

Auctions will set a recovery value on the bonds and swaps sellers will pay buyers the difference between that and the face value of the debt.

Wolfgang Schäuble Issues Another Warning to Greece

The Financial Times reports Greek debt swap triggers massive payouts.

Billions of dollars are to be paid out in insurance-like instruments as Greece on Friday pressed ahead with the largest ever sovereign debt restructuring.

However, there was a long delay over the decision by the ISDA determinations committee, which is made up of 15 global banks and investment funds, that annoyed some investors.

Uncertainty still hangs over the CDS market as an auction process to decide the amount of pay-outs may not take place for another week.

Bill Gross, who runs the world's biggest private bond fund at Pimco, warned that CDS had been undermined by the saga. "The rules have been changed here," he said in a radio interview. "The sanctity of their contracts is certainly lessened."

Wolfgang Schäuble, the German finance minister, said: "Greece has today been given the chance to make it. But Greece will now have to seize this chance itself."

In a stern message to Athens, Olli Rehn, Europe's economics commissioner, called the second bailout "a unique opportunity not to be missed" and said: "I now expect the Greek authorities to maintain their strong commitment to the economic adjustment programme and to rigorously and timely implement the policy package."

Greece's lenders are mounting an unprecedented surveillance campaign to try to guarantee the government's commitment. At least four officials from the commission's economics department will now be stationed in Athens full time – along with representatives from the International Monetary Fund and the European Central Bank – to vet government policies.

Eurozone Exit Trigger Is Cocked

Greece will exit the eurozone. However, the timing is still in question.

I suggest Greek politicians will not meet increasing conditions placed on Greece by Germany and that later this month funding will be cut off triggering a Greek return to the drachma.

If so, look for enough funds to be dispersed to Greece in the next couple weeks that allow a quick round-trip to the ECB to make the ECB whole. Once the ECB is in a no-loss situation, the roof can easily cave in.

The exit trigger is cocked. All it takes is for either Greece or Germany to pull it.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

Euro Sell the News Round-Trip

Posted: 09 Mar 2012 09:42 AM PST

The following chart shows the silly rise in sentiment over the last two day that "Success at Gunpoint" actually meant something good.

Euro 15-Minute Chart (2-Day Timeframe)

click on chart for sharper image

Following the announcement the deal would go through coupled with reasonable job growth in the US, traders changed their minds.

The euro rose from just above 1.31 to 1.33 and back again.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

Nonfarm Payroll +227,000 ; Unemployment Rate Steady 8.3%; BLS vs. Gallup

Posted: 09 Mar 2012 08:25 AM PST

Quick Notes About the Unemployment Rate

In the last year, the civilian population rose by 3,584,000. Yet the labor force only rose by 1,569,000. Those not in the labor force rose by 2,014,000.
In February, the Civilian Labor Force rose by 476,000.
In February, those "Not in Labor Force" decreased by 310,000. If you are not in the labor force, you are not counted as unemployed.
Participation Rate rose .2 to 63.9%
Were it not for people dropping out of the labor force, the unemployment rate would be well over 11%.

Over the past several years people have dropped out of the labor force at an astounding, almost unbelievable rate, holding the unemployment rate artificially low. Some of this was due to major revisions last month on account of the 2010 census finally factored in. However, most of it is simply economic weakness.

Jobs Report at a Glance

Here is an overview of today's release.

US Payrolls +227,000 - Establishment Survey
US Unemployment Rate steady at 8.3% - Household Survey
Average workweek for all employees on private nonfarm payrolls was unchanged to 34.5 hours
The average workweek for production and nonsupervisory employees on private nonfarm payrolls edged higher 0.1 hour to 33.8 hours.
Average hourly earnings for all employees in the private sector rose by 3 cents to $23.31

Recall that the unemployment rate varies in accordance with the Household Survey not the reported headline jobs number, and not in accordance with the weekly claims data.

February 2012 Jobs Report

Please consider the Bureau of Labor Statistics (BLS) February 2012 Employment Report.

Nonfarm payroll employment rose by 227,000 in February, and the unemployment rate was unchanged at 8.3 percent, the U.S. Bureau of Labor Statistics reported today. Employment rose in professional and businesses services, health care and social assistance, leisure and hospitality, manufacturing, and mining.

Unemployment Rate - Seasonally Adjusted

Nonfarm Employment - Payroll Survey - Annual Look - Seasonally Adjusted

Actual employment is about where it was in 2001.

Nonfarm Employment - Payroll Survey - Monthly Look - Seasonally Adjusted

click on chart for sharper image

Between January 2008 and February 2010, the U.S. economy lost 8.8 million jobs.

Over the last two years, nonfarm payrolls have added 3.5 million jobs. Of the 8.8 million net jobs lost between January 2008 and February 2010, 40 percent have been recovered.

Statistically, 127,000 jobs a month is enough to keep the unemployment rate flat. The average employment gain over the last two years has been 145,000, barely enough (statistically speaking) to make a dent in the unemployment rate.

Yet, the civilian unemployment rate has dropped from 9.8% to 8.3%.

Average Weekly Hours

Index of Aggregate Weekly Hours

Average Hourly Earnings vs. CPI

"Success" of QE2 and Operation Twist

Over the prior 12 months, average hourly earnings have increased by 1.9 percent. In January, the Consumer Price Index for All Urban Consumers (CPI-U) had an over-the-year increase of 2.9 percent; growth in prices has recently been outpacing growth in earnings.
Not only are wages rising slower than the CPI, there is also a concern as to how those wage gains are distributed.

BLS Birth-Death Model Black Box

The BLS Birth/Death Model is an estimation by the BLS as to how many jobs the economy created that were not picked up in the payroll survey.

The Birth-Death numbers are not seasonally adjusted while the reported headline number is. In the black box the BLS combines the two coming out with a total.

The Birth Death number influences the overall totals, but the math is not as simple as it appears. Moreover, the effect is nowhere near as big as it might logically appear at first glance.

Do not add or subtract the Birth-Death numbers from the reported headline totals. It does not work that way.

Birth/Death assumptions are supposedly made according to estimates of where the BLS thinks we are in the economic cycle. Theory is one thing. Practice is clearly another as noted by numerous recent revisions.

Birth Death Model Adjustments For 2011

Birth Death Model Adjustments For 2012

Birth-Death Note

Once again: Do NOT subtract the Birth-Death number from the reported headline number. That approach is statistically invalid.

Household Survey Data

click on chart for sharper image

In the last year, the civilian population rose by 3,584,000. Yet the labor force only rose by 1,569,000. Those not in the labor force rose by 2,014,000.

That is an amazing "achievement" to say the least, and as noted above most of this is due to economic weakness not census changes.

Decline in Labor Force Factors

Discouraged workers stop looking for jobs
People retire because they cannot find jobs
People go back to school hoping it will improve their chances of getting a job
People stay in school longer because they cannot find a job

Were it not for people dropping out of the labor force, the unemployment rate would be well over 11%.

Part Time Status

click on chart for sharper image

Part-time status shows little improvement vs. a year ago.

Table A-15

click on chart for sharper image

Table A-15 is where one can find a better approximation of what the unemployment rate really is.

Notice I said "better" approximation not to be confused with "good" approximation.

The official unemployment rate is 8.3%. However, if you start counting all the people that want a job but gave up, all the people with part-time jobs that want a full-time job, all the people who dropped off the unemployment rolls because their unemployment benefits ran out, etc., you get a closer picture of what the unemployment rate is. That number is in the last row labeled U-6.

U-6 is much higher at 14.9%. Both numbers would be way higher still, were it not for millions dropping out of the labor force over the past few years.

Grossly Distorted Statistics

Given the complete distortions of reality with respect to not counting people who allegedly dropped out of the work force, it is easy to misrepresent the headline numbers.

Digging under the surface, the drop in the unemployment rate over the past two years is nothing but a statistical mirage. Things are much worse than the reported numbers indicate.

BLS vs. Gallup

Gallup has the unemployment rate at 9.1% not 8.3% and the "underemployment" number at 19.1%, not 14.9%.

Bear in mind the Gallup numbers are not seasonally adjusted but the BLS numbers reported above are. Nonetheless, it's entirely safe to say that 19.1% is far closer to the truth than 14.9%.

Please see Gallup Reports Large Jump in Unemployment to 9.1%, Underemployment to 19.1% for details.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

Damn Cool Pics

Vintage Car Bookshelf
Top 10 Internet IPO’s of The Last 10 Years [Infographic]
Dollar Shave Club's Hilarious Viral Ad
The World's Largest Slingshot
Microwave Case Mod

Vintage Car Bookshelf

Posted: 09 Mar 2012 07:14 PM PST

Dutch design studio Denieuwegeneratie converted a vintage Jaguar into a tall bookshelf for the interior of their newly-built Dutch Mountain underground villa. By removing its engine, cutting out a large rectangular window in the roof, and placing the vintage Jaguar upright, the once active vehicle is transformed into an intriguingly attractive storage unit and shelving space. The trunk even serves as a lower cabinet.

Via Mymodernmet, Dezeen

Top 10 Internet IPO’s of The Last 10 Years [Infographic]

Posted: 09 Mar 2012 06:17 PM PST

IPOs (initial public offerings) are the first set of stocks introduced into the public market by a previously private company. IPOs boost a company's equity and exposure, but also demand more accounting and marketing management.

Facebook's initial public offering has become one of the most anticipated deals ever. It is set to become the biggest Internet-related IPO on record. Check out this awesome infographic from Vincent Abry which shows the top 10 Internet IPO's of the last decade:

Click on Image to Enlarge.

Dollar Shave Club's Hilarious Viral Ad

Posted: 08 Mar 2012 09:51 PM PST

Tired of spending all your cash on those expensive store razors? Well, spend no more! It's called the Dollar Shave Club and they ship a razor to your door every month for just a buck!

According to the LA Times, "The company estimates that it will save members as much as $292 per year on shaving." But according to Mike, founder of DollarShaveClub.com, the clip you're about to see is one of the greatest (not to mention hilarious) moments in advertising history.

The World's Largest Slingshot

Posted: 08 Mar 2012 08:04 PM PST

The world's largest slingshot is made by Bros from DudePerfect cutting down a tree and making a giant slingshot out of it and is used to slam dunk a baseball successfully.

That would be just the perfect thing to play a real-life game of Angry Birds!

Microwave Case Mod

Posted: 08 Mar 2012 02:31 PM PST

This is a very old, but very clever casemod where the modder turned his microwave into a computer. The LCD screen is of course built into the window and it looks great with that screensaver that shows a plate of food going round and round. All of the buttons on the microwave have been rewired to control the computer.

Accessories include a slot DVD drive in the top of the microwave, and the power supply, cable connectors and vents have been installed in the back.

Via: technabob

How to Cross Post From Twitter to Your Facebook Page Graywolf's SEO Blog

How to Cross Post From Twitter to Your Facebook Page

Posted: 09 Mar 2012 09:47 AM PST

One of the questions I get asked by clients who are developing a social media strategy is should I cross post my Facebook posts to Twitter and vice versa, or does everything need to be unique?

IMHO you need to look at social media like Moneyball and you need to look at your actions in terms of ROI. I don’t believe all the social media gurus riding on unicorns who preach that social media is about the conversations man (best said in a hippie voice for dramatic effect). Social media is about giving you an alternate channel to connect with new or existing customers, demonstrate your expertise, solve problems, or promote products with the goal of providing customer service, building loyalty, and making sales. At the end of the day, nothing happens until someone sells something.

IMHO you need to look at social media like Moneyball and you need to look at your actions in terms of ROI …

For most clients, I recommend having a blog. It’s an easy way to add new content, demonstrate your expert knowledge, and build links. While RSS reading was a big fat lie, the fact is that RSS as a tool works. There are are all sorts of plugins that let you automatically publish your feeds to twitter or Facebook. Before you start doing that, though, you need to figure out where you are and where you want to be.

If you have a personal Twitter account and personal Facebook page, it doesn’t matter which way you choose. However, if you have one or more professional Twitter accounts and one or more Facebook brand pages, you are limited in how you can connect them. A personal Twitter account can connect and auto publish to a personal Facebook page and vice versa. You can’t connect a Twitter account to a Facebook brand page, but you can connect a Facebook brand page to any Twitter account.

Enabling the link between Facebook Brand pages and Twitter

Once you know which situation you fit into, set up one to auto-publish to the other, then find the plugin that publishes your new posts to Facebook or Twitter. Voila! You are done with the first step.

No one wants to follow or engage with someone who only talks about their own stuff. You need to demonstrate your expertise, share industry related news & information, or basically curate your feed so it’s interesting and has value to others. My favorite tools to do this are Hootsuite and Bufferapp (see How to Automate a Twitter Feed With Hootsuite and Bufferapp). I use news readers like Zite and Flipboard to find stories about specific topics to populate my accounts. I then use Twitter lists and Facebook friend lists to look for related accounts to like, share, and retweet from (see How to Create a Local Twitter Account).

The one downside to this approach is that Twitter and Facebook become identical. If you want to post to only one account you have to log in and do it to that account. It’s a minor annoyance but, with the time you save over the long haul , you should still get more return from less work.

So what are the takeaways from this post:

Assess your current situation with personal/brand pages to figure out which account should be the master account that publishes to the other account
Configure your blog to publish to the master account
Curate your feed, make it more interesting, and demonstrate your expertise with on-topic discussions, ideas, and links from other industry-related sources with smart news readers
Use tools to automate and spread out your posts, allowing you to work in batch while appearing to be active in social media all day

photo credit: Shutterstock/Nerjon Photo

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Advertisers:

Text Link Ads - New customers can get $100 in free text links.
BOTW.org - Get a premier listing in the internet's oldest directory.
Ezilon.com Regional Directory - Check to see if your website is listed!
Need an SEO Audit for your website, look at my SEO Consulting Services
Directory Journal - Get permanent deep links in a search engine friendly directory
LinkWheel SEO - Get Web 2.0 Backlinks
TigerTech - Great Web Hosting service at a great price.
Article-Writing-services.org - Article Writing Services creates quality content for websites and blogs at no cost to site owners.
Link Building Services - Hire WeBuildLink.com for well-planned advanced link building campaigns. Very affordable. Contact us now for a FREE evaluation.
Join 500+ top agencies & publishers who rely on The HOTH every day. US based, enterprise-grade support. High quality, contextually relevant links. 100% money back guarantee. Try it now.

Professional website designs - Get a unique brand image with website designs that sets you apart and convert your visitors into customers. Make a brand, not just a website
Krystal Glass Whiteboards - Glass writing boards for offices, boardrooms, and classrooms.
Performance-Based White Label SEO
SEO Cockpit