Goldman Sachs is cutting back more in its staff than previously announced. Though not yet confirmed, Bloomberg writes that the reductions in the fixed income business are being increased. After posting absolutely horrible results for Q1, the job cuts were expected. The continuation of them, however, seems to be more drastic than first thought even though “market” conditions improved into [...]
Wall Street is predictably overreacting to the unpleasant payroll report. It is understandable in a way since, as noted yesterday, the Establishment Survey and the unemployment rate are all that is left to suggest the economy remains on track and any weakness would be temporary. It was a strained position to begin with, especially since the economy shifted lower almost two [...]
The underlying fundamentals of oil and energy remain highly negative. Oil prices have been supported by sentiment for some time now, but that hasn’t changed much from between under $30 to over $40 at the front end. In the latest weekly update from the US EIA, domestic oil production fell rather sharply in the last week of April. It was [...]
The BLS released its updated productivity estimates showing that Q1 2016 was negative for the second straight quarter and the fourth of the past six. Such negative and flat productivity in any real sense doesn’t make sense. This disparity seems to be, as always, in the BLS serially overstating the employment gains. The level of increase in total hours worked [...]
Factory orders declined again in March 2016, which was entirely expected on calendar effects alone. As leap year fades into historical memory, economic accounts are returning to their now normal slow, steady contraction. Year-over-year, factory orders were down 2.8% from March 2015, but it was the second consecutive March to receive a negative number. Factory orders (not seasonally adjusted) in [...]
When commenting on any weakness in the US economy, it has become common even shorthand for any outlet or author to affix the conventional explanation. Suspiciously low growth rates and far too many outright contractions, especially in manufacturing and industry, are blamed on overseas weakness and the dollar as if absent that foreign interference all would be sailing along right [...]
There isn’t a whole lot known about the Federal Reserve’s Foreign Reverse Repo accommodation, and I believe that is intentional. The rate which the Fed pays to “borrow cash” from foreign central banks and governments is unknown. What is known is just how much in total the Fed is “accommodating” foreign dollar business. This RRP, in sharp contrast to the [...]
It seems as if some “markets” are having a difficult time coping with the different speed at which the economy is changing. Maybe that should be expected given the dramatic transformation of them into often computer-driven frenzies of headline scans. But this is something else, made so by the nature of this current economic condition as divorced from our experience. [...]
The ongoing lesson in PMI interpretation added another layer with China’s turn. The official manufacturing PMI dropped back to 50.1in April from 50.2 in March. Last month’s rise above 50 was the first in that position since last July. Because of the mainstream interpretation about what 50 or not 50 means, it was taken then as if it were definitive [...]
If there is any wonder why PMI’s deserve scorn, this morning’s twin bill delivered solid reasoning. Both the ISM Manufacturing Index and the Markit Manufacturing PMI declined, and both remained above 50. However, there was no real consensus about what any of it meant. Depending on the media outlet determining commentary about either, there was both positive and negative spin [...]
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