Bear market? Unemployment's the tipper
Jul. 1st, 2010 08:58 am![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
solarbirdAs of this morning, the S&P500's peak for the year is 120% of current index - but that's only a 17% drop from peak. Some people are already declaring this an official bear market, partly on the former number, but the latter number is what you need to declare a bear market more or less "official." (A 20% decline - the definition - is not the same as the peak being 120% of your current value. 120/100 = 1.20, 100/120 = 0.83.)
This is on a combination of bad news over the last few days; today's report that initial jobless claims rose in the face of an expected decline, May's already-reported but collapse in home sales, and the ISM's report of a substantial slowdown in the rate of manufacturing growth. Yesterday's ADP report only 13,000 private-sector jobs were added last month - in the face of much higher expectations (consensus estimate 60k; lowest estimate 25k)- helped set the stage.
You need +150k to keep up with population growth, by the way.
In related news, US Senate Republicans successfully filibustered the latest renewal of extended unemployment benefits, this time, in a standalone bill. Democrats expect to try again when a replacement for Senator Byrd is appointed, but right now, 1-2 million unemployed people will fall off extended/emergency unemployment coverage in the next couple of weeks.
I missed this story on CBC Money a few weeks ago, but please note that Canadian farmers are facing a debt crisis unseen since ever, mostly due to rising costs. There's a very unhappy chart showing the situation over the last decade, and it's reaching a tipping point. The situation varies wildly by province, so check the charts.
Most US state budgets, meanwhile, have collapsed, with Federal stimulus aid running out and not being replaced.
The GM headline figure triggering a market recovery mid-morning ("US June sales rise 10.7%") sounds really good until you remember that GM was bankrupt in June last year, and Calculated Risk says the numbers are actually "very weak."
I'd do more, but I'm in practice mode for the show on Sunday. Good luck out there.
This is on a combination of bad news over the last few days; today's report that initial jobless claims rose in the face of an expected decline, May's already-reported but collapse in home sales, and the ISM's report of a substantial slowdown in the rate of manufacturing growth. Yesterday's ADP report only 13,000 private-sector jobs were added last month - in the face of much higher expectations (consensus estimate 60k; lowest estimate 25k)- helped set the stage.
You need +150k to keep up with population growth, by the way.
In related news, US Senate Republicans successfully filibustered the latest renewal of extended unemployment benefits, this time, in a standalone bill. Democrats expect to try again when a replacement for Senator Byrd is appointed, but right now, 1-2 million unemployed people will fall off extended/emergency unemployment coverage in the next couple of weeks.
I missed this story on CBC Money a few weeks ago, but please note that Canadian farmers are facing a debt crisis unseen since ever, mostly due to rising costs. There's a very unhappy chart showing the situation over the last decade, and it's reaching a tipping point. The situation varies wildly by province, so check the charts.
Most US state budgets, meanwhile, have collapsed, with Federal stimulus aid running out and not being replaced.
The GM headline figure triggering a market recovery mid-morning ("US June sales rise 10.7%") sounds really good until you remember that GM was bankrupt in June last year, and Calculated Risk says the numbers are actually "very weak."
I'd do more, but I'm in practice mode for the show on Sunday. Good luck out there.
