Morning Report – Job openings at 2001 levels 12/9/14

Markets are lower worldwide after a big sell-off in China. Bonds and MBS are rallying.

The Chinese government instituted new regulations for local debt last night, which sent the markets reeling. Chinese stocks have been on a tear recently (up something like 30% since Nov 1) so the news was an excuse for some major profit-taking, which sent the indices down something like 5%.

Small business optimism picked up a bit in December, as the NFIB Small Business Optimism approached the historical average before the Great Recession began. A big increase in economic optimism drove the increase. Earnings trends are heading higher, and some are planning to increase employment, which is good news for the economy.

Another good data point for the market: Job openings rose to 4.834MM in October from 4.685MM in September. This almost matches August’s number, which was the highest since early 2001. Combine that with a steady diet of sub 300k initial jobless claims prints and the leading indicators of the labor market are looking strong. Now about that wage growth…

New 3% down loans are expected to have only a marginal effect on increasing credit availability. Separately, This is all part of an attempt to get the first time homebuyer back into the market, which has been the Achilles Heel of this housing recovery. The problem is that while a 3% downpayment isn’t necessarily daunting, the credit score the banks require is – something like 755. For young adults with student loan debt, that sort of score probably just isn’t in the cards. Here are the FAQs for the 3% down loans from Freddie Mac.

Obamacare Architect Jonathon Gruber heads to Capitol Hill today to discuss the obfuscation and white lies involved in the selling of Obamacare. In an unfortunate (for him and Obama) minute of candor, he discussed how the the plan relied on the “stupidity of the American voters” to get it through, and how the “Cadillac Tax” was a brilliant piece of wordsmithing that set in motion the eventual taxability of employer-provided health care benefits. Don’t expect much out of Gruber – he will probably apologize for the language he used and spend the rest of the time lawyered up and will simply relay previously prepared talking points. Note that the Medicaid subsidy issue is going to be taken up by the Supreme Court as well, which could throw the whole thing in peril.

10 Responses

  1. Frist. That’s really all I’ve got at the moment.

    Like

  2. Scott,

    Good grief!

    Like

  3. What was that Buckley said about the phone book. Harvard Faculty and governing?

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    • McWing:

      What was that Buckley said about the phone book. Harvard Faculty and governing?

      I’ll bet it applies to a lot more than governing, too.

      Like

  4. Someone on the left finally figures it out:

    “Have Democrats Failed the White Working Class?
    DEC. 9, 2014
    Thomas B. Edsall

    Why don’t white working-class voters recognize where their economic interests lie? Somewhat self-righteously, Democrats keep asking themselves that question.

    A better question would be: What has the Democratic Party done for these voters lately?”

    http://www.nytimes.com/2014/12/10/opinion/have-democrats-failed-the-white-working-class.html?ref=opinion&_r=0

    Like

  5. Stories like that make me happy. Because despite his apparent success he will never know happiness. A happy and decent person would have said “great dinner, but FYI, your website it out of date” and left it at that. only someone completely miserable with nothing better to do would spend more than 2 mins worrying about something like this.

    and now, the whole world knows what a petty little man he is. Merry Christmas, asshole.

    Like

  6. Restaurants invariably have awful websites and the fancier the restaurant the worse they are. Online PDF menus are a horrible idea for exactly this reason.

    I do confess to once going ballistic when the price at the gas pump was a nickel a gallon more than the station’s sign.

    I am reminded of the lawyer in DC who sued for $54M when his dry cleaner lost a pair of pants.

    http://www.washingtonpost.com/wp-dyn/content/article/2007/06/25/AR2007062500443.html

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  7. Ben Edelman is an associate professor at Harvard Business School, where he teaches in the Negotiation, Organizations & Markets unit.

    Presumably not very well.

    Like

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