U6-UR spread widened even more, this could also be used as a leading indicator, since there is no improvement it shows the worst labor market since the 30's is getting worse. Lacker might want to read the part of the mandate that says Fed is responsible for full employment before he checks in at the John Hopkins Mental Center
Gross on CNBC His 'model' says core CPI is headed to 0%. Fed only raises after 12 months UR peaked and NFP is +200K monthly, looks easily like a 2011 story. Likes 10y 30y UST http://www.cnbc.com/id/15840232?video=1282662790&play=1
Of course his partner McCulley was on the tape in late August ringing a bell for the "end of the secular bond bull market".
VERY interesting research by William Hester http://www.hussmanfunds.com/rsi/forwardearningsmargins.htm To me it seems like a nobrainer that when people get disappointed they will trash this stock market, specially in the context of a secular bear in stock and a financial crisis that is not over. So even though they say "Outside of very large changes in earnings, there is essentially no correlation between year-over-year changes in earnings and changes in stock prices" they also have research showing that economic data that is better or worse than expected correlates well with the stock market
Excellent article by Kessler http://www.zerohedge.com/article/kessler-market-commentary He says inflation picksup 1.5 to 3 years after recessions are over. 1-2 years for the 6mo annualized core CPI, since it will take a while for the Fed to be 'sure' inflation bottomed(5-10 months), a first hike only in 2012 is not out of the cards
About the last employment report "Unemployment would have topped 10 percent if not for the more than half million Americans who left the workforce." http://www.bloomberg.com/apps/news?pid=20601014&sid=aIQSkFg5czbg The way to see through the issue of people dropping out of the labor force is to look at the sum of employed people to total population. This is a statistic that Chairman Bernanke personally looks at http://4.bp.blogspot.com/_8rpY5fQK-UQ/Ssdx8bg1ZXI/AAAAAAAAIHo/dCwSgkMNFlI/s1600-h/emppop.png
http://www.newyorkfed.org/newsevents/speeches/2009/dud091005.html Bernanke(chairman), Kohn(vice chairman) and Dudley(NY Fed) are all dovish. Looks like there are a few adults running the fed afterall Dudley even points out that the labor force is quite likely to rise on the labor market gets better. All these UR numbers are coming in better than otherwise because people are sick of not finding jobs and are staying at home and giving up, once NFP gets positive they will flood the market. UR at 11% is quite possible http://econompicdata.blogspot.com/2009/10/labor-force-shrinkage.html He also talks about inflation and uses this chart http://www.elitetrader.com/vb/showthread.php?s=&threadid=178339
Aussies raised rates (unexpectedly) last night. Its pretty obvious that Australia is benefitting from the craziness in China more than most, but they're economy has as much of a consumer debt problem as the US. It can happen.