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Archives for October 2012

Housing Recovery: Your Best Investment Today or Already Overplayed?

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Yesterday the Census Bureau released the September report on the number of Housing Starts and Building Permits. Both increased much more than expected—permits surged by 11.6%, and starts were up by 15%. After trudging along a Derpressionary bottom for more than three years, it is now safe to say that housing activity is finally picking up (prices may be a different story). But don’t get too excited. Despite the most accommodative monetary policy in the history of the republic, the 15% surge in starts only moves us from Depressionary levels to recessionary levels. Housing will of course … [Read more...]

The Truth about Last Week’s Jobless Claims

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Last week we cautioned you to be skeptical of the weekly jobless claims numbers. They didn’t include quarterly claims from California, the nation’s most populous state, and therefore looked like they had improved much more than they had in reality. This week that theory was proven correct, as last week’s numbers were revised upward, and today’s reported claims were the highest in 13 weeks. … [Read more...]

The Great Gold Bull Market

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In the last five years the price of an ounce of gold has increased 131%. Easy monetary policies and the downgrade of many sovereign debt ratings, including that of the U.S., have contributed to the high demand for the safe-haven precious metal. Since May 16, in the lead up to September’s Federal Reserve announcement of QE infinity, the market pushed the price of gold up by 12.6%. The price of the yellow metal is consolidating and could break out at any moment. Gold should be a component of all investment portfolios today as a hedge against profligate fiscal and monetary policy. … [Read more...]

Manufacturing’s Renaissance Faltering in New York

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For the third consecutive month, the Empire State Manufacturing Index indicated that the manufacturing industry in New York is declining. Any value below zero indicates that manufacturing in New York is shrinking. The October survey recorded a -6.2. Many manufacturers reported a decline in the availability of credit, and indicated that business conditions in New York are deteriorating. The decline in credit availability comes at a time when manufacturers are increasing their demand for financing. The report says “the share of manufacturers reporting a tightening in credit was almost … [Read more...]

What We’re Reading 10-12-12

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The Mathematicization of Economics, John Aziz, Azizonomics Obama's Disappearing $5 Trillion, Review & Outlook, Wall Street Journal So Long Price-Earnings, Hello Price-Expectations, Romain Hatchuel, Wall Street Journal CEO to Workers: I May Fire You if Obama Wins, Robert Frank, CNBC Beware the ‘central bank put’ bubble, Mohamed El-Erian, Financial Times Prepping for Obamacare, Chain Cuts Workers' Hours, AP Mysterious Algorithm Was 4% of Trading Activity Last Week, John Melloy, CNBC IMF Sees ‘Alarmingly High’ Risk of Deeper Global Slump, Sandrine Rastello, … [Read more...]

Jobless Claims Jive

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The report on weekly initial jobless claims was released this morning to much fanfare. The number of new claims fell by 30,000 to 339,000, the lowest since February of 2008. The bottom of the consensus range of predictions in Bloomberg’s survey of economists was 362,000, or a drop of only 5,000 claims. But the reported numbers are misleading. One state (analysts assume it’s California), didn’t report its figures for the quarter. The Labor Department failed to mention any anomalies in the data in the official press release, but told Dow Jones later through a spokesperson “one large state … [Read more...]