From: vince farrell
Sent: Wednesday, February 06, 2008 10:37 AM
Sent: Wednesday, February 06, 2008 10:37 AM
Andy Fisher, who knows music, says the "widowed bride" in American Pie was Maria Elena, Buddy Holly's wife. I do like the macro thought of JFK etc. Listen to the song. It fits both.It's Bob Marley Day in Jamaica and on this day in 1940 Tom Brokaw came into this world. I didn't know Brokaw was a Rastafarian ! Babe Ruth was also born on Feb.6,1985, and in 1788 Massachusetts became the sixth state to ratify the Constitution.
There was no ratification of a Democratic nominee yesterday. Cinton vs. Obama is going to go the full 15 rounds. Romney should save his money as McCain looks like a lock. Will Hucabee get the VP nomination to encourage the Christian right to support McCain ?
Productivity for the fourth quarter came in at +1.8%, better than forecast. This ordinarily would be reason for rejoicing, but it was due to employers cutting the number of hours worked, so bummer. Good news was the fifth consecutive weekly rise in mortgage applications. Lower rates are doing what they are supposed to. Lower mortgage interest payments would be a prop to consumer spending.
Investors Business Daily newspaper reports that this is the worst year to date start for the S&P average EVER ! (Thanks Art Cashin for pointing that out.)
I visited Ed Hyman and Nancy Lazer's shop, ISI, this morning. Ed heard I was coming and chose to be in Cleveland. Do you believe that ! Cleveland is better than Farrell ! Anyway, it was as fascinating a visit as always and the one item I want to note now is that Ed and Nancy still think we can avoid recession. Nancy points to the weekly unemployment claims (which you know I watch closely) to support their view. Last weeks number was bad, but she notes the four week moving average would have to average, repeat, average, 400,000 for the rest of the quarter for GDP to be breakeven. Last weeks reading was 325,000. So claims will have to go through the roof for them to move to the recession camp. We'll loyally report tomorrow when the number is released at 8.30 AM.
Ed and Nancy aren't all work. Bunch of neat motivational posters around the office. My favorite, " Cross an economist with the Godfather, and you get an offer you can't understand."
Make up calls. See you on "The Call" at 11 AM
3 comments:
I just randomly stumbled across this blog. I'm surprised that you had such magnificient info. Thus - and don't be offended by my asking this - is the following true?
"Nancy points to the weekly unemployment claims (which you know I watch closely) to support their view. Last weeks number was bad, but she notes the four week moving average would have to average, repeat, average, 400,000 for the rest of the quarter for GDP to be breakeven. Last weeks reading was 325,000. So claims will have to go through the roof for them to move to the recession camp."
Anonymous: Firt, thanks for stopping by. This post is from an e-mail that I get from Vince Farrell (as noted in the post header and body). I post these with his permission.
I'm not in a position to judge the validity of Ed Hyman's shop's work, but I think that their shop is a trusted source of commentary.
I would contend that unemployment claims are understated given that there were so many undocumented workers employed by the construction industry which formed the backbone of most of our recovery. Accordingly, there may have to be some other calibration to this number. Calculated Risk has done a magnificent job of discussing this.
Oh yeah, Ed Hyman is legendary.
Thanks a lot for these posts. This is great stuff.
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