Jobs report in line; December tightening a go 12/4/15

Stocks are lower after the jobs report came in as expected, which puts the Fed on track for their first tightening in 9 years in a couple of weeks. Bonds and MBS are up small.

Jobs report data dump:

  • Nonfarm payrolls + 211k vs. 200k expected
  • Unemployment rate 5%, in line with expectations
  • Average Hourly Earnings +0.2% MOM / +2.3% YOY in line
  • Underemployment rate 9.9% vs 9.7% expectations
  • Labor Force Participation rate 62.5% vs. 62.4% expected

The general take on the jobs report is that it is good enough to give the Fed comfort to raise rates in two weeks. Digging in deeper, the increase in jobs were in construction (+46k), professional services (+28k), health care (+24k), restaurants (+23k) and retail (+31k). Mining and IT lost jobs.

Homebuilder Hovnanian reported numbers this morning, Revenues were flat compared to last year, while margins fell as deliveries fell 2% in units. The dollar value of net contracts increased 29%, which bodes well for next year. Backlog is up 30%.

Uber is now valued at $65 billion, which makes it about the 80th biggest company in the S&P 500, and gives it about the same market cap as Danaher. The bubble of the day is in these pre-IPO companies. By the time they actually go public, they are typically overvalued.

Negative equity fell from 16.9% a year ago to 13.4% last quarter, according to Zillow. A normal number is closer to 5%. They have a cool interactive map where you can search by county to see what percentage is underwater.

We are beginning to see some softness at the super-high end of the US residential real estate market. Some of this is undoubtedly driven by foreign demand.

21 Responses

  1. Frist!

    … It’s not quantity, it’s quality.

    🙂

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  2. Not to mentioning saving the best for last, eh, Kevin? 🙂

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  3. I hate to sound like a right wing troll, but some days I think Nobel prize winner Paul Kurgman is demented.

    Future historians — if there are any future historians — will almost surely say that the most important thing happening in the world during December 2015 was the climate talks in Paris. True, nothing agreed to in Paris will be enough, by itself, to solve the problem of global warming. But the talks could mark a turning point, the beginning of the kind of international action needed to avert catastrophe.

    Then again, they might not; we may be doomed. And if we are, you know who will be responsible: the Republican Party.

    O.K., I know the reaction of many readers: How partisan! How over the top! But what I said is, in fact, the obvious truth. And the inability of our news media, our pundits and our political establishment in general to face up to that truth is an important contributing factor to the danger we face.M

    I had an elderly neighbor as a child who, when he could speak to me alone, would explain how everybody in his house was trying to murder him. Krugman kind of reminds me of that guy.

    Or maybe I’m just reading him wrong, but there’s not a sentence that seems reflective of individual thoughtfulness or objective reality.

    It’s absurd to think that the talks in Paris will be any different than any of the dozen climate talks we’ve had—people well-placed in government get to go to Paris and preen before the cameras while socializing and partaking of fine cocktails and French pastries. Even if some of them are earnest about “the problem”, rather than the more pressing problem of enjoying themselves and putting on a good show in the kabuki theater that is “global political action”, the chances of them getting anything going is going to be small, and even if they do the solutions are mostly new taxes, wealth redistribution, and establishing schemes for carbon trading to make already very wealthy people that much wealthier.

    And will ultimately make no different in regards to the planet’s temperature, and that’s assuming human carbon dioxide output has any kind of impact on global temperature anyway, which remains a huge assumption.

    BTW, we can always tell somebody is right and knows exactly what they are talking about when they use the word “obvious”. And it also lets you know what an ignorant savage you are if you are to dim to see this simple, obvious truth.

    I hate the Republicans, and they should be thankful there are folks like Krugman (and PlumLine commentators) out there, or I’d never vote for ’em again!

    Anyone who follows U.S. political debates on the environment knows that Republican politicians overwhelmingly oppose any action to limit emissions of greenhouse gases, and that the great majority reject the scientific consensus on climate change.

    Seriously. This guy won a Nobel Prize. And he thinks carbon offsets, carbon credits, and carbon taxes and just sending tax payer money to corrupt third world nations for “clean energy projects” would limit greenhouses gasses?

    Last year PolitiFact could find only eight Republicans in Congress, out of 278 in the caucus, who had made on-the-record comments accepting the reality of man-made global warming.

    I don’t like anyone in the GOP, generally, but those eight in particular need to go.

    BTW, you know something is real and skeptics are totally wrong when it’s necessary to say “accepting the reality” because anyone who hasn’t accepted it, or harbors any doubts, is clearly irrational and divorced from reality because, you know, science.

    And most of the contenders for the Republican presidential nomination are solidly in the anti-science camp.

    A Nobel-prize winner doesn’t understand how to use words? Because being skeptical of one conclusion of climate science—specifically, that Americans need to be taxed immediately to stop the planet from getting warmer—qualifies as “anti-science” it what way? Anti-science does not mean “disagrees with me”, it would mean you are opposed to science in most or all of its forms. Or at least more than one part of one assertion made by “science” about climate.

    I often hear from people claiming that the American left is just as bad as the right on scientific issues, citing, say, hysteria over genetically modified food or nuclear power. But even if you think such views are really comparable to climate denial (which they aren’t)

    Not only is the idea that the views aren’t as bad as “climate denial” arguable (because there is no metric to make such an assessment), in the case of nuclear power it’s actually the left in opposition to one of the most likely technologies to reduce carbon dependence and carbon dioxide output over the next half-century. It’s interesting that he cited nuclear power, and nuclear power would be a great way to reduce our dependence on coal and natural gas for electricity production. But the left being against an actual technological solution, as opposed to a tax policy and wealth redistribution “solution”, to carbon dioxide emissions apparently evokes no cognitive dissonance.

    But I hope I’m wrong, and I’d urge everyone outside the climate-denial bubble to frankly acknowledge the awesome, terrifying reality. We’re looking at a party that has turned its back on science at a time when doing so puts the very future of civilization at risk. That’s the truth, and it needs to be faced head-on.

    All right, GOP. Nominate whichever pathetic loser you’re going to insist on throwing at us. I’ll vote for them. Dammit.

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    • KW:

      Krugman has truly turned into a buffoonish caricature. It is to the NYT’s everlasting discredit that it continues to publish his drivel. And the level of hysteria over “climate change” is really quite staggering.

      With regard to his predictions about what history will say, he’s never had what I would call keen insight. Consider this, from early 2002:

      http://www.nytimes.com/2002/01/29/opinion/the-great-divide.html

      I predict that in the years ahead Enron, not Sept. 11, will come to be seen as the greater turning point in U.S. society.

      Hmmm. Sure, Jan.

      Like

  4. @scottc1: “Heh…Baghdad Barack:”

    Racism! I demand a safe space.

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  5. Meh, the electric car is simply a better mousetrap and will replace the internal combustion engine. Natural gas will replace coal for power generation…

    Problem solved.

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    • Problem solved.

      Yep. We can clean up our power generation and probably will. Because it is a good idea regardless of its climate contribution. Clean air, clean water; better than dirty air, dirty water.

      If climate changes rapidly, the changes in power generation are now unlikely to deal with that. So moving populations out of coastline lowlands and off low islands is something various gummints might want to explore.

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      • Mark:

        So moving populations out of coastline lowlands and off low islands is something various gummints might want to explore.

        Maybe the people themselves ought to explore that, if they think where they live is a problem. I just don’t understand the reflexive belief that every potential problem requires a government solution. Although one thing the government might do is stop subsidizing flood and hurricane insurance for coastal areas, which hides the true cost/risk of living there.

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  6. Bill Moyers sees Krugman’s vitriol and raises….

    http://billmoyers.com/2015/12/03/the-gop-on-the-eve-of-destruction/

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  7. Dayum, even that douchebag Dawkins.

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  8. Although one thing the government might do is stop subsidizing flood and hurricane insurance for coastal areas, which hides the true cost/risk of living there.

    Agreed. And I should have made clear that removing incentives, rather than adding new ones, was what I had in mind. I would also use flood plain zoning more aggressively to remove incentives. No new building in most of New Orleans, for example. My thoughts about which gummint should do this tend toward the gummint closest to the problem. That would be a pipedream in Orleans Parish, of course, but we cannot have everything we want, right?

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    • Mark:

      That would be a pipedream in Orleans Parish, of course, but we cannot have everything we want, right?

      Don’t I know it!

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  9. Brent,thanx for the underwater interactive map. Cool, indeed. Turns out the worst counties in TX for this are the ones surrounding Fort Hood, America’s largest military base. Hmm…

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  10. Mark, that makes sense… Military members would be using VA loans that don’t require downpayments…

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  11. @mcwing: “Dayum, even that douchebag Dawkins.”

    Dawkins has the intellectual consistency to hate all religions and all religious people, and generally religious mysticism in any form. Bill Mahr is in this same camp, and its frees them from the need to view Islamic fanatics through the regressive ideological/partisan lens of “if the right is against it we must be for it”.

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  12. @mcwing: “Is there anything Jihadists could do bad enough to lose support of Regressive Left? If even throwing gays off cliffs won’t do it, what will?”

    If they swear a fatwah against all abortion clinics and start suicide bombing them, maybe? Nah, even then they’ll be so excited to equate Islamic terrorism with right wing evangelicals that they won’t “rush to judgement” on Islamic terrorism generally. Or it will remain Dubya’s fault for starting the war in Iraq.

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  13. Congrats, Michi!

    Like

  14. Like

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