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Apple backpedaling on some iOS development restrictions, will allow third party tools and ad services originally appeared on Engadget on Thu, 09 Sep 2010 08:50:00 EST. Please see our terms for use of feeds.
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Initial Jobless Claims were much better than expected at 451k vs the forecast of 470k and down from 478k last week (revised up by 6k). Labor Day weekend may have had an impact on the seasonal adjustment but we’ll have to see next week to what extent. Either way though, the market will take a downward move to the lowest since early July in light of the worrisome rise over the past month. Continuing Claims were above expectations but little changed with the prior week while Extended Benefits were up a net 30k. Also giving a boost to the futures was the less than expected July Trade Deficit of $42.8b vs the est of $47b which may lead to a boost to economists Q3 GDP estimate of as much as .4 of a % point as exports rose 1.8% while imports fell by 2.1%. In contrast, trade was a big drag on Q2 GDP.
Some of you have intimated that I have become too chipper lately, and that lowering our cash position from ~86% to ~50% can only be the work of a madman, a rampaging perma-bull.
Well then, its time to run some counter-programming to that perception. Hence, I thought that David Rosenberg of Gluskin Sheff would help balance out my short term bullish leanings.
I love when David and I disagree, as I am always trying to find people whose approach and methodology I respect, but have reached very different conclusions from me.
Enjoy.
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This is what a depression is all about — an economy that 33 months after a recession begins, with zero policy rates, a stuffed central bank sheet, and a 10% deficit-to-GDP ratio, is still in need of government help for its sustenance. We had this nutty debate on Friday on Bloomberg Radio (Tom Keene is a class act, by the way) and another economist was on — the architect of the ECRI I think, who was claiming that there was no evidence of any indicator pointing to renewed economic contraction. And yet, that very day, the ECRI leading economic index comes in at a recessionary -10.1% print for last week. Go figure. The market for denial remains a lucrative one we would have to assume.
A depression usually involved a liquidity trap. In other words, expunging the debt excesses of the previous cycle leads to an ongoing contraction of credit where the demand and supply of loan-able funds is basically non-existent. This is why Libor (three-month interbank) rates are down to five-month lows of under 0.3%.
With President Obama’s approval rating all the way down to 43%, the Democrats are about to embark on a series of confidence-bolstering announcements.
Banks continue to sit with over $1 trillion of cash on their balance sheets and despite survey evidence suggesting a big thaw in once-tight lending guidelines, there is no indication that the Fed’s attempt to restart the credit engines is working. Companies are sitting on tons of cash themselves so they don’t need the money from the banks and households don’t seem ready or willing to take on major credit-sensitive spending commitments. Perhaps with one-quarter of Americans with a sub-650 FICO score, the typical U.S. bank loan officer doesn’t want to get fired for making the same mistake that got us into this mess in the last cycle and is actually requesting some documentation and proof of income (surely you jest).
Finally, you know it’s a depression when, 33 months after the onset of recession…
• Wages & Salaries are still down 3.7% from the prior peak
• Corporate profits are still down 20% from the peak
• Real GDP is still down 1.3% from the peak
• Industrial production is still down 7.2% from the peak
• Employment is still down 5.5% from the peak
• Retail sales are still down 4.5% from the peak
• Manufacturing orders are still down 22.1% from the peak
• Manufacturing shipments are still down 12.5% from the peak
• Exports are still down 9.2% from the peak
• Housing starts are still down 63.5% from the peak
• New home sales are still down 68.9% from the peak
• Existing home sales are still down 41.2% from the peak
• Non-residential construction is still down 35.7% from the peak
Folks, in a normal recession-recovery cycle, practically all these indicators are making new highs at this juncture of the business cycle.
Invictus here. Been a while. Been a bit busy and, frankly, not much to say of late.
As a general rule, I’d say that folks should refrain from posting on things they know nothing about. The old saying (Abraham Lincoln, I believe, Mark Twain, according to commenters’ citations, attribution in dispute) comes to mind, “Better to keep your mouth shut and let people think you’re a fool than open it and remove all doubt.”
Erick Erickson should not write about the economy, as he has demonstrated yet again that his knowledge of things economic is, to put it politely, somewhat lacking.
Just a while back, Mr. Erickson incorrectly claimed that “after the 2003 tax cuts, the unemployment rate fell to the lowest level since World War II. Let me repeat that: the Bush economic program created the lowest unemployment level ever.” Of course, the rate had been lower in just the last decade, under Bill Clinton. And that fact was quite easily ascertainable via mouse click at BLS.gov or the St. Louis Fed. I mean, really, we’re talking unemployment rate here, not some esoteric metric no one’s ever heard of and can’t research. I don’t believe a correction has yet been posted on that particular item, nor am I holding my breath.
Not quite outdoing that egregious error, but giving it his best shot, Mr. Erickson came up with this gem regarding last week’s nonfarm payroll report:
The number Mr. Obama will want us to pay attention to is private sector job growth. According to the government, private sector jobs went up and the growth of unemployment is attributed to those census workers leaving their jobs.
At least National Review got it right:
The unemployment rate climbed to 9.6 percent as a result of many new entrants into the labor market (about half a million workers).
That the unemployment rate went up was a function, as NRO pointed out, of new entrants into the work force. This is captured in the Household Survey, from which the unemployment rate is calculated. It had nothing, zero, zilch, nada to do with “census workers leaving their jobs.” Those losses were captured in the Establishment Survey. And I would challenge Mr. Erickson to point to the government attributing the rise in the unemployment rate to jobless census workers.
Undaunted, he ventures on:
When unemployment was going down, it did so because of the hiring of the 500,000 census workers and Mr. Obama and his band of merry socialists were cheering the numbers as a sign of good news.
No, the unemployment rate did not go down because of census worker hiring. Again, that was captured in the Establishment Survey. The unemployment rate is derived from the Household Survey. It had gone down for the opposite reason that it just went up — people had been leaving the labor market. This concept of two surveys and which one captures what is really not all that challenging. Or at least I didn’t think it was.
Live by the temporary census worker jobs. Die by the temporary census worker jobs.
Except it simply did not go down that way.
Mr. Erickson should endeavor to write about topics on which he is a bit more knowledgeable, though I haven’t the foggiest as to what that might be.
The Greek 2 yr note yield is below 10% for the 1st time since mid Aug after a story that Norway continues to buy Greek debt along with that of Spain, Portugal and Italy. Also talking its position is the Greek Finance Minister who said on their deficit, “we feel confident that given where we are at the moment there won’t be any problem in hitting the target.” Another Greek official in an interview said with respect to the market’s belief of an inevitable debt restructuring, “no one is even contemplating or thinking about” that. If one believes this and trusts the EU backstop, a 2 yr yield around 10% is certainly alluring. As expected, the BoE left rates unchanged while the BoKorea surprisingly did not raise rates because of what they said is rising uncertainty in the outlook for global growth. Australia delivered a better than expected jobs report for Aug and the AUD is rallying to a 4 month high.
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Thank You So Very Much July 26, 2007
Reviewed By: Bryan
It's perfect, just what I needed, I can finally sleep at night with the peaceful feeling I used to get as a child living back near the beach. It's a blessing. Thank you very much.
Personal Pick! The Ultimate Beauty Sleep Tool
April 2, 2005
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Living in the Sonoran Desert is wonderful, but my Pisces nature misses the sound of the rolling sea. This Ocean Sleep soundscape is conducive to rest and relaxation, and satisfies my need to listen to the waves. I sleep deeply and feel refreshed upon awakening. I also adore using this for a rejuvenating afternoon nap! You must have this.
Sail off to a good night's sleep
January 28, 2005
Reviewed By: Jill
I had been looking for a no nonsense, nothing added recording of sea sounds. I love the sea and its soothing sound helps me go off to dreamland. Most recordings have subliminal garbage or new-age philosophy. This recording is beautiful and authentic. The price is right. I have been very pleased.
A Home by the Sea
March 10, 2005
Reviewed By: Alan
My Wife and I recently spent a couple of days at the Oregon Coast (as it's only about 80 miles away) but none the less we still have to come home. Sleeping in a beach-front motel, we would leave the windows open listening to the constant drone of the ocean waves... ahhh, relaxing.
Anyway, this is a great recording of that sound... no seagulls or anything. Just the constant, slightly changing, gentle yet powerful sound of the ocean that fills the air there. My Wife loves it as it helps her to fall asleep since she has this freight train (yours truly) snoring next to her. Great job, I didn't think it could sound so real over audio equipment.