Rationalizations from the Dismal Set



Once again, we go to the overlooked but very worthwhile online WSJ’s round up of dismal scientists:

Friday’s report showing nonfarm-payroll growth of 112,000 in November was well below most economists’ expectations. Here’s what some economists are saying about the data and what they mean for jobs, growth and interest rates.

"Today’s employment report provided a disappointing headline number, especially heading into the holiday season, but it doesn’t change the outlook for a solid New Year. In any event, I think we have to reserve judgment about what this report means for the economy as a whole. It’s weak enough to raise concerns, but not weak enough to prove anything bad."
Bill Cheney, chief economist, John Hancock Financial Services


"Employment gains stalled temporarily after a blowout month in October that was boosted by hurricane cleanups. However, it is too early to be pessimistic. Service jobs, including health care, education, leisure, etc., are continuing to trend up and the labor force jumped 439,000, indicating that the optimism in the labor market is increasing. The recent job picture indicates that the holiday shopping season will be a decent, not a spectacular one."
Sung Won Sohn, executive vice president, Wells Fargo Banks


"The November employment report was once again a study in contrasts, with the payroll survey and household survey showing vastly divergent results. Still, the underlying trend on both fronts continues to suggest modest, if not blockbuster, improvement in the labor market. This implies that the Fed should continue on its rate-hike path on Dec. 14, with a 25-basis-point increase in the fed-funds target to 2.25%."
– David H. Resler, chief economist,
– Parul Jain, deputy chief economist, Nomura Economics Research
Question:  What the hell is a deputy chief economist?)


"Payrolls came in well below expectations in November, and there were significant downward revisions to September and October (totaling 54,000). Also, hours worked and average hourly earnings were disappointing. The only bright spot in the report was the strength in the household survey, which showed a whopping 483,000 rise in employment."
David Greenlaw, managing director, Morgan Stanley


"Nonfarm jobs grew just 112,000 in November, below forecasts, but maybe not as much a surprise as the headline figures suggest. So far in 2004, monthly job growth has been reported as low as 32,000 jobs to 358,000 jobs. Trend-wise, hiring growth exhibits more stability than might be suspected from the monthly swings."
Stephen Gallagher, economist, SG Economic Research


"While weak, it must be understood that the November result follows an October outcome that, even after being revised down, was still well above trend. Hurricanes depressed September payrolls and boosted the October outcome. A better measure of underlying job growth is probably offered by a smoothed reading (three-month moving average), which shows plus-178,000 as of November."
Joshua Shapiro, chief U.S. economist, MFR Inc.

Economists React
Compiled by Mali Fleming
WSJ, December 3, 2004 12:28 p.m.

Category: Economy

Nonfarm Payrolls: +112,000 Jobs

Category: Economy

Three Peaks and the Domed House redux

Way back in October 2003, we looked at master technical analyst George Lindsay’s repetitive chart pattern, Three Peaks and the Domed House. That version showed a fairly prescient call by Ned Davis, before the January ’04 top. That was then, this is now. Its time to revisit the pattern, this time via Jeff Hirsch of…Read More

Category: Markets

Oil & Weather: A Guest Persepective

Back on the anniversary of the crash, I ran a guest post from Rob Fraim: 1987 Crash Revisited. That was well received; I thought Rob’s latest missive was worth reproducing here:

In the midst of the recent big drop in oil – which is likely at least partly due to forced/margin selling – there is an interesting point to be considered.

Writing on the financial website Street Insights, Richard Ritholtz [Editor: no relation — as far as I know] made the following comments today:

· It’s too early to write off the winter even though the weather has been quite mild in the Northeast and Midwest to date.

· Heating oil inventory is still at a low absolute level, although it is clearly in a building mode over the next weeks.

· The market experienced significant long liquidation yesterday as several large funds locked in their profit for the year; December 1st clearly signaled that year end is not far away.

· Based on information from several private forecasters, I believe that the overall winter temperatures from Dec. 21- Mar. 21 will be average to below normal even, though the November through early December temperatures have been milder.

As to the weather (ok…cue the “Let’s Make Fun of Rob Fraim” theme music here) here is something of interest (or fun if nothing else):

The Old Farmer’s Almanac has a noteworthy record for medium-to-longer range weather forecasts.

Oh, I know you’re laughing at me now. You’d rather pay attention to Skippy the Weatherman on your local Accu-Weather at 6:00 who can’t, for Pete’s sake figure out whether it’s going to rain tomorrow. (And who each year predicts 4 huge snowstorms that never materialize and misses on the blizzard that blindsides you.)

Read More

Category: Markets

even more Accelerated Depreciation of Capital Spending

Category: Economy

Chart of the Week: S&P 500 Breakout

Category: Markets

New Column up at Real Money (12//04)

Category: Media

Universal Music Takes Matters into its Own Hands

Category: Finance, Media, Music

Business Week Annual Predictions

Category: Markets, Media

Your world with Neil Cavuto: (11/30/04)

Category: Media