The unemployment rate dropped to 7.0% (from 7.3%) while the U.S. economy added 203,000 jobs in November. In addition, the labor force participation rate rose to 63.0% (from 62.8%). These numbers were stronger than expected.
Nonetheless, the U.S. labor market remains below its pre-recession employment numbers.
Calculated Risk posts a monthly chart that puts the current jobs recovery into perspective. It is often referred to as the "Scariest Chart Ever". It shows the job losses from the start of the employment recession, in percentage terms, compared to previous post WWII recessions.
This chart shows the depth of the recent employment recession — worse than any other post-war recession — and the relatively slow recovery due to the lingering effects of the housing bust and financial crisis.
If things continue as they have been, it appears payrolls will exceed the pre-recession peak in mid-2014.
Currently, there are about 1.3 million fewer payroll jobs than before the recession started; and at the recent pace of job growth it will take about 7 months to reach the previous peak.
Given the circumstances, I think the chart shows we've made good progress. Talk about Qualitative Easing, coordinated actions by global Central Banks … or a pretty visible 'unseen hand' all you want … but the Economy and Market seem to have adapted well to change.
You can learn a lot by watching puppies. Barley, here, is sporting the "Cone of Shame" … which was our attempt to stop him from licking his nether-region till it was swollen and raw.
Despite our best efforts, Barley has figured-out how to contort his body and use his prehensile tongue to get the job done anyway.
I guess Charles Darwin was right … "It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change."
Most find a way to get what they musthave.
Here are some of the posts that caught my eye. Hope you find something interesting.
What happens doesn't matter nearly as much as what you what make it mean … and what you choose to do.
Dallas got about an inch of ice and snow towards the end of last week, and we are still at a virtual stand-still five days later.
Growing up in New England, this would have been so minor that people wouldn't have called it a 'storm'. Because ice is so rare here, and we don’t have sanding, salting, or scraping capabilities (or people skilled enough to be comfortable driving in it) this was a Storm.
As a result, the best plans gave way to the shut-down.
Snow isn't 'good' or 'bad' … and neither was the change of plans.
Perspective.
Fund managers recognize the importance of sensibly diversifying risks and opportunities.
Be that as it may, as MotherJonesreported in the wake of the financial crisis, the nation's 10 largest financial institutions held 54% of our total financial assets (compare that to the 20% they held in 1990). Meanwhile, the number of banks has dropped from more than 12,500 to about 8,000.
Here is a map, from the Federal Reserve, that shows the consolidation. Click to see a bigger version.
Many people are shocked by a chart like this. It must be 'bad' to have so much controlled by so few, right?
But it isn't hard to find a version of this story playing-out in other industries: Print Media, Music, Broadcast Channels, Consumer Products … this type of consolidation happens for a reason.
A firm that marshals that more resources gains competitive advantage and has more ways to win.
They benefit from economies of scale, transactional leverage, better distribution and partners, and more ways to diversify risks. In addition, if they work to communicate, collaborate, and coordinate their actions (and data) they can unlock opportunities that others simply don't have (or can't see).
Here is a Chart Showing Some of the 'Winners' at that Game.
Here is a more specific example. You probably think you are familiar with Nestlé. It is famous for chocolate; but did you realize it was $200 billion-corporation … and the biggest food company in the world? Nestlé owns nearly 8,000 different brands worldwide, and takes a stake in (or is partnered with) many others. Included in this network is shampoo company L'Oreal, baby food giant Gerber, clothing brand Diesel, and pet food makers Purina and Friskies.
The Federal Open Market Committee's surprise decision to refrain from announcing a tapering down of its quantitative easing program on September 18 has given a lift to a variety of markets around the world.
The chart below highlights returns across asset classes — both in the year to date and since the September 18 decision.
The orderly returns by asset class surprised me (Equities, Credit, Debt, FX, then Commodities). It also surprised me that the biggest winners since the Fed decision were Spanish and Italian equities.
The Stock Market tends to be 'mean reverting' … meaning when the pendulum swings too far in one direction, it makes sense to expect it to swing back in the other direction.
Recently, the equity market rally has surprised people with its size and duration. Seemingly everywhere I go, there are traders talking about how they expect a 'Top' but "don't want to fight the Fed."
Yes, price is up and so is the trend …but how unusual is this year's big move up?
Stores are becoming showrooms for consumers to find items to buy online.
Coming into Black Friday, a new version of the the increasingly popular game "Internet Destruction" is about to let consumers take another shot at destroying Retailing (like they have already done to newspapers, magazines, music and book publishing).
Here are some of the posts that caught my eye. Hope you find something interesting.
