From my experience in the last 2 months, the Private Manufacture Index (my clients ) has been mixed. The guys that are able to tap into the Global Trade area are doing ok. They are making a profit but are starting to see the stronger dollar hurt them. The guys that are Regional and Local are struggling. Depends on the size of their Company. Guys that own 50 million and up seem to be doing ok. They told me that smaller clients (Vendors) are having a hard time securing bank lines of credit. It also depends on the industry they manufacture in. The auto guys, metals, platics, res'ns, etc have felt the majority of the blow. 40% drop in orders in the last 30 days. Steel guys, non-residential construction, plastics non-auto, Metal Plat'n, etc are doing ok. below 10 Million are struggling. Two guys I talk to, (Non clients as of yet) are gloom and doom and speak of a depression. All the others, still buying 100k share in Energy Deals left and right. So, I would have to say, the ice is thin and it is breaking in certain areas. Right now, it's to early to say. Keep in mind, these are private companies and their owners. This is not public data and is not followed by the "FED". As long as these guys keep buying my Private Equity Deals, I'm keeping a positive attitude, eventhough I know the market and parts of the economy are being crused. As soon as our Deals Stop funding do to fear, from our clients, then I will panic.
Hey listen, 18-wheelers may be storming down your road, and you may need a reservation at your neighborhood Applebee's. I work in the financial services business and I can tell you that things are not just bad, but moribund and bleak. Legg Mason just today annouced an 8% cut to staff, two days ago State Street cut 6% of its staff, and JP Morgan is cutting 21%. That is just this week's announcements, and these are not isolated incidents. I could literally fill up a whole page of financial firms making job cuts or ceasing to exist at all. Point being, these are high paying white collar jobs in the largest sector in our economy. There is a huge trickle-down in areas where finacnial services jobs are concentrated like the largest city in the US, NYC. I think you are looking at the world with rose-colored glasses and the worst is yet to come. Why don't you wait for more confirmation of your opinion from the eonomy and stock market before you come on here with your useless predictions?
Its interesting because one fellow here just said that it was going to be a recession on Wall Street and a Depression on Main Street. I think its the other way around. We've got a Depression on Wall Street, but a light recession on Main Street. And things seem to be improving on Main Street lately. If Joe Six Pack would stop listening to the news about Wall Street every night, they probably wouldn't change their spending habits one little bit... Katie Couric is scaring the hell out of them. Yeah, its my opinion. And yours is just as good. But all this is so overblown and discussion of Depression is just silly. We have much better tools at guiding the economy and a much better understanding of how to do so. SM
I agree with Ricerocket that we're due for a powerful bear market rally. Right now, bearish sentiment and pessimism is almost unanimous in all corners, which is a strong contrarian indicator. Usually when everyone is convinced the market is destined to go one way, that's when a turnaround in imminent. Also, as I mentioned in another thread, take a look at the chart of the Dow after the crash of 1929. From the end of '29 to mid 1930 the Dow had a 50% bear market rally before resuming it's downward collapse. If history repeats, a 50% retracement from the low of 7500 would take us back to 11k on the Dow sometime by spring '09. Of course, make no mistake, it would only be a bear market rally, nothing more. And if the parallels continue, the downturn would resume sometime by summer I would guess, or whenever the masses and media are convinced everything is wine and roses again. Bottom line, don't discount a powerful bear market rally from this point. If it comes, don't look a gift horse in the mouth. Ride it for what it's worth, and when it runs its course flip back to the short side.
Economists React: Employment Report âAlmost Indescribably Terribleâ http://blogs.wsj.com/economics/2008...loyment-report-almost-indescribably-terrible/ Economists and others weigh in on the substantially worse-than-expected decline in nonfarm payrolls, and the increase in the unemployment rate. This is almost indescribably terrible. In the past six months the U.S. has lost 1.55 million jobs, almost as many as were lost in the whole 2001 recession, which included 9/11 and the two months after. The pace of job losses is accelerating alarmingly, as this report attests, with steep drops in most sectors but the biggest deterioration in services â down 370,000 in November after 153,000 in October. Note education/health and governmentt added 59,000, so core private payrolls even worse than headline. Desperate. âIan Shepherdson, High Frequency Economics Quite simply, there was nothing good in this report. Even though some might take comfort in the relatively modest uptick in the jobless rate (from 6.5% to 6.7%), this is actually quite misleading. In fact, the household surveyâs measure of employment came in at -673,000, an even sharper plunge than seen in the payroll figures. The jobless rate was actually restrained by a large decline in the labor force â as we had suspected⦠It is worth noting that the November payroll figures would have been even worse were it not for a special factor. We estimate that the direct and indirect effects of the resolution of the Boeing strike probably added about 35,000 employees to manufacturing payrolls in November. âDavid Greenlaw, Morgan Stanley The September-though-November period saw an average 419,000 average monthly job losses, as the recession deepened. More timely unemployment insurance claims data suggest no let up in the current pace of job losses. While the unemployment rate rose only 0.2 percentage point to 6.7% in todayâs report, the labor force shrank by 422,000 in November and 237,000 over the September-November period. While this suggests a discouraged worker effect, the severe worsening in labor markets has been relatively recent, with employment declines in January-August deviating little from the -82,000 per month average. There is little doubt that labor slack is rising rapidly, and the unemployment rate will jump in the months ahead. âSteven Wieting, Citigroup The November decline stands as the largest single month drop since December 1974, when employment plummeted by 602,000. With the latest revisions averaging nearly 100,000 per month, the November job loss could easily end up being the new post-World War II benchmark for severe job declines. The current job losses however are a much smaller share of total employment. For instance, the 535,000 decline represents a 0.39% drop in employment from October while the December 1974 drop was 0.77%. Nonetheless, the scale and speed of job losses over the last three months remains the worst since the 1973-75 recession. âDavid Resler, Nomura Securities The bottom drops out of the labor market⦠History tells that once the labor market weakens as much as it has in the past several months, job-shedding takes on a life of its own and tends to persist for a long while. We expect labor market conditions to be dreadful for many months to come and consequently for consumer spending to continue to decline. The U.S. consumer, which for so many years was the global engine of growth, will remain a significant drag on economic activity in coming quarters. âJoshua Shapiro, MFR Inc. These are god-awful numbers. The economy is headed downhill and the brakes are not working. There are so many layoff announcements that it is hard to keep track of. Some businesses are cutting jobs in anticipation of tougher times. This is especially true for retail, manufacturing and finance, which accounts for the bulk of jobs in the country. They want to trim fats and stay lean and mean for the tough times ahead. Also, business spending will be a drag on the economy in the foreseeable future. âSung Won Sohn, Smith School of Business and Economics A shockingly weak report that suggests the fourth quarter could see a drop in real GDP of 5% or more at an annual rate. The large downward revisions to employment in September and October suggest that the economy was even weaker than we thought when the credit crunch intensified (indeed the employment report for September, which now shows a larger than 400,000 decline in jobs, was surveyed in the week before Lehman Brothers failed).,, These data will spur the calls for a massive stimulus plan, increase the chances of a rescue package for the domestic auto industry. âRDQ Economics Jobs plummeted again in November with deep and widespread job losses. Much of this collapse in jobs was due to the collateral effects of the credit crunch which is only slowly being repaired. So far this year, 1.91k jobs have been lost with half of those jobs being lost in the past 3 months as the downward spiral has accelerated. The recession is intensifying and the economy is rapidly shrinking. âStephen A. Wood, Insight Economics This was much worse than was expected and represents wholesale capitulation. The threat of a widespread depression is now real and present. âPeter Morici, University of Maryland
Yes, in one month. How many jobs were lost in the last year? And how many million are unemployed right now?
Unemployment is at 6.7%. Add in discouraged workers, remember the recession is now over a year old, and you can get 10%. This means 1 in 10 americans is out there without a job, yeah, everything is fine and dandy..