Friday, March 9, 2012

Quick Hits - March 9, 2012

The mainstream media elements beating the drum for the re-election of President Barack Obama is doing cartwheels over the February jobs information released by the Labor Department this morning.  One such example is the New York Times headline - "The US Extends Its Run of Strong Job Growth Another Month"... but, as always, the devil is in the details.

The data from the Labor Department reported that the US economy added 227,000 jobs in February which was sufficient to maintain the 'official' unemployment rate at 8.3%.  The job numbers for December 2011 and January 2012 were also revised upwards in today's report.  The U6 unemployment rate, which includes those underemployed dropped from 15.1% to 14.9% and the labor participation rate saw a very slight increase in participation from January - which was the lowest level seen since 1983.

Zerohedge starts by taking a deeper look into the Labor Department numbers for February and notes that Professional and business services organizations added 82,000 jobs in February - but of this number, 45,000 of these jobs were in temporary help other words, temp jobs.  That's 1 out of every 5 jobs created in February.

This highlights one of the challenges with the Labor Department numbers that should be causing concern - not celebration...the 'part-time' economy that is resulting...
About 160k of private jobs added in Feb are 'low-paying work' which left average hourly earnings up only 0.1% (notes David Ader at CRT) - hardly the recipe for a sustainable recovery and perhaps the slow leak in stocks post the number is the rude awakening to that reality. As we noted before, "not only is America slipping ever further into a state of permanent "temp job" status, but that a "quality analysis" of the jobs created shows that the US job formation machinery is badly hurt, and just like the marginal utility of debt now hitting a critical inflection point, so the "marginal utility" of incremental jobs is now negative."
Hot Air sees some additional trends that do not seem to fit with the Labor Department numbers or the trends that the economy is gaining strength in its recovery.  Durable goods and factory orders reports from January reflect a slowdown - which is confirmed with today's release of the January trade numbers showing a 4.3% increase that month in our trade deficit.  Imports grew by 2.2% while our exports only grew by just under 1.5% - which are the goods we are producing for trade.  Wholesale inventories are growing while sales numbers are falling.

The February job numbers from the Labor Department differ significantly from those calculated by Gallup - which shows a far more pessimistic trend in the unemployment rate.

The 0.5-percentage-point increase in February compared with January is the largest such month-to-month change Gallup has recorded in its not-seasonally adjusted measure since December 2010, when the rate rose 0.8 points to 9.6% from 8.8% in November. A year ago, Gallup recorded a February increase of 0.4 percentage points, to 10.3% from 9.9% in January 2011.

In addition to the 9.1% of U.S. workers who are unemployed, 10.0% are working part time but want full-time work. This percentage is similar to the 10.1% in January, but is higher than the 9.6% of February 2011.

Gallup sees an unemployment rate of 9.1% now - without making seasonal adjustments.  The Labor Department sees an unemployment rate of 8.3% and tries to posit that 227,000 new jobs / month is part of a strengthening economic recovery.  Ignored, the Labor Participation rate and other data that is at or near record levels for numbers of long-term unemployed and the duration of being unemployed.

It's a challenge to look at these other trends and the disparency in the trends and numbers and conclude that we are in a strengthening recovery.  As Zerohedge noted yesterday:
Critically, this means that whatever they need the number to be, it will be though we hesitantly point out the sad reality that while we have added jobs for 17 consecutive months (apparently), the average 133k addition is still insufficient to absorb all the new entrants to the labor force, suggesting the unemployment rate is likely to remain above 8%.
Given this is an Administration that is perpetually in campaign mode and active in creating theater / propaganda to redefine the facts - this seems more of the same.  I have no confidence or trust in the data from the Administration as the date appears manipulated to fit to desired end result.  The job outlook is not improving.  It is insufficient to keep pace with population growth.  The labor participation rate is too low, the long-term unemployed are too many - and have been in that position for far too long.  What jobs are being created are low quality jobs - all of things that the Democrats attacked the Bush Administration over back when unemployment was 4.7%.  Today, its the case - then it was just political theater.

The House of Representatives overwhelmingly passed the GOP authored JOBS Act yesterday by a 390-23 vote.  All 23 'No' votes were cast by Democrats, who were abandoned by 158 other Democrats who voted with the GOP majority.  The Act is a collection of initiatives intended to promote small business job growth and lessen some of the regulatory / administrative burdens that have been placed on small businesses by Congress and the Administration.  The Democrats who opposed the bill called it far too small to make any real job creating impact...

The GOP in the Senate is vowing to keep trying to force the approval of the Keystone XL pipelinealls urging Democrats to not support the amendment, did the measure fall short.

One question that isn't being asked - if the President actually does support the Keystone XL pipeline - and is only concerned about part of the route through Nebraska sand dunes (where other pipelines traverse), why is he working so hard to lobby Democrats to oppose the approval of the project?

One of the memes that is coming out from the Obamacare mandate kerfuffle is that the focus of the Administration and their progressive allies to re-define the kerfuffle as evidence of a GOP 'war against women' is resulting in major increases in support towards President Obama and those 'on the side of women'.  Except, apparently, in Massachusetts.  If this really is that much of a winning issue - why is progressive hard left Senatorial candidate Elizabeth Warren still trailing Scott Brown by 9-10 points in the polls?
In radio ads, op-eds, and interviews, Democratic Senate candidate Elizabeth Warren cast Republican senator Scott Brown as an extremist for supporting a conscience exemption to the mandate. "She revamped her entire campaign for the last three weeks to orient it around this issue and took on the mold of a social warrior," a Brown campaign official tells THE WEEKLY STANDARD.

The mandate dominated news for the month of February, but polls show that Warren's contraception war hasn't worked out as planned.

Bill O'Reilly is continuing to ask many pertinent questions about the Sandra Fluke kerfuffle - and points towards the White House running this as political theater to change the focus from the President's unconstitutional religious organization mandate to a 'war on contraception'.

BOR notes that former Obama Advisor Anita Dunn's PR firm is now representing Sandra Fluke and managing her public appearances. She is still only appearing on friendly programs where she will be offered nothing more than softball questions, like her appearance on 'The View', as opposed to venues where she will have to face serious questions as to why her rights have more substance than the rights of religious organizations - or her sense of entitlement to get from taxpayers via the government something that costs her but $9 per month.

Just wondering here - How many think that Sandra Fluke actually testified before a Congressional committee when she made her comments supporting the Obamacare mandate requiring religious organizations and institutions to provide free contraceptives, sterilization, and abortifacients? 

She didn't testify before Congress.  Progressives tried to add her at the 11th hour to the committee testimony on religious freedom and the religious mandate - but she was rejected as a witness because she had no standing on religious freedom or religious issues.  The so-called testimony was a 'dog and pony show' orchestrated by progressive Democrats attended by progressive Democrats done outside the official process of a committee meeting intended to 'simulate' a committee meeting.

The SuperPAC supporting President Obama which received a $1 million contribution from the vulgarian Bill Maher has said that it will not return the contribution to Maher over his misogynistic slurs directed at Sarah Palin.  Bill Burton, founder of the SuperPAC, says that there is no comparison between what Rush Limbaugh said and what Bill Maher said - noting that Maher is just a comedian - as if that makes a difference.

Keith Olberidiot, former MSNBC host, and currently the host of a Current TV commentary program that draws 47,000 viewers nightly, belatedly attempted to apologize to conservative women Michelle Malkin and S.E. Cupp over vile misogynistic insults he made over the last year.  However, both Malkin and Cupp told Keith to 'Shove It' as they rejected the insincere attempt at theater.

Kirsten Powers, the liberal columnist and Fox News contributor continues to be one of the few from the left that is calling out the hypocrisy of the left regarding misogynistic insults in the media.  She follows up last week's column with another this week...
The uproar over Limbaugh is only because it fits into the Democratic narrative that the GOP is “anti-woman.” It’s Democratic Party activism dressed up as feminism.
One of the companies that dropped its advertising from the Rush Limbaugh radio program over the talk icon's calling Sandra Fluke a 'slut' is now asking to be reinstated and resume advertising on the program.  Limbaugh's response?  No.  Said a Limbaugh representative in response to the company's President...
“Unfortunately,” Glicklich wrote, “your public comments were not well received by our audience, and did not accurately portray either Rush Limbaugh’s character or the intent of his remarks. Thus, we regret to inform you that Rush will be unable to endorse Sleep Train in the future.”

Decisions do have repercussions.

Washington Post hard left progressive Eugene Robinson today accuses GOP Presidential candidates (with the exception of Ron Paul) of being warmongers for their outspoken condemnations of Iran and harsh line over Iran's nuclear program. According to Robinson, a vote for a Republican in November is a vote for war with Iran before arguing that Iran has to be given the benefit of the doubt over their nuclear program until we are 110% certain that they've built a nuclear weapon. Then he makes the typical vapid argument towards using sanctions and diplomacy rather than war to dissuade Iran from producing nuclear weapons.

I won't be holding my breath waiting for Robinson to condemn another warmonger...

When Apple moved aggressively to offer electronic books in their online bookstore for use on the iPad / iPhone platform, they were specifically targeting Amazon and it's Kindle platform.  Apple's book offerings were priced higher than those in the Kindle store - and major US publishers not only quickly adopted the Apple model - but took action to force Amazon to change their pricing structure to match Apple's.  Now the Department of Justice is warning Apple and 5 major US publishers of a possible anti-trust lawsuit being filed against them over alleged collusion setting prices for eBooks.

I'm not a huge fan of anti-trust legal action, but this is one case where I do think it is warranted.

President Obama's Health and Human Services Secretary, Kathleen Sebelius apparently has no idea if or that the Obamacare Healthcare Reform legislation her Department is responsible for implementing adds to the national deficit rather than reducing the deficit as claimed during the debate on the bill.  Her cluelessness was highlighted in her testimony earlier this week before Congress:
SEBELIUS: The original estimate, yes. I think that’s–

JOHNSON: Right. So, the original estimate for deficit reduction–

SEBELIUS: I’m assuming–

JOHNSON: The original estimate for deficit reduction in the first 10 years was $143 billion, correct?


JOHNSON: So now we, we’ve reduced that $143 billion by $86 billion – by not getting revenue from the CLASS Act – and now $111 billion because we’ve increased the mandatory costs of the exchanges, correct?

SEBELIUS: I’m assuming the numbers are correct. I’m sorry I don’t have them.

JOHNSON: So, when you add those together, that’s $197 billion added to the first 10-year cost estimate of Obamacare, so now we are instead of saving $143 billion, we are adding $54 billion to our deficit, correct?


JOHNSON: We’ll submit that to the record. But, that’s basically true. So instead of saving $143 billion, by this administration’s own figures and budget, we’re now adding $54 billion to our deficit in the first 10 years. To me, that would be the first broken promise. It is true that the President said that by enacting this healthcare law, every family would save $2500 per year, in their family insurance plan – correct?

SEBELIUS: He said that once the exchanges are up and running, and you have an affordable marketplace, the insurance estimates were that the rates would go down by about $2500, yes– that has not occurred yet.

JOHNSON: The Kaiser Family Foundation has already released a study saying that average costs of family healthcare plans is up $2200, correct?

SEBELIUS: Again, there is no new marketplace yet for insurance policies.

JOHNSON: But the costs are already up. We’re already different by $4700; it’s going to be hard to get us down to $2500 cost savings. I would consider that broken promise number two.

Just over 80% of Greece's private-sector creditors agreed to accept 75% losses and signed onto the debt swap program that is one of the cornerstones of the EU bailout program for the fiscally troubled country...
The Greek government announced the results of its proposed restructuring early Friday morning. It said 83% of bondholders had voluntarily submitted to the deal, and that it would invoke so-called collective-action clauses to impose the exchange on most of the rest, bringing participation up to 96%.

The announcement that the restructuring will go ahead precipitates the largest-ever sovereign-debt default and the first for a Western European country in half a century.

The Telegraph is also reporting from earlier today -
10.00 Just after The Greek Finance Minister addressed parliament, figures were released showing the Greek economy contracted faster than expected in the final quarter of 2011. Fourth quarter GDP shrank by 7.5pc year on year, against an earlier estimate of 7pc.

This lends credibility to the view that the worsening economy will erode the benefits from today's debt deal and leave Greece vulnerable to a third bailout down the road.

On This Day in History

1847 - US Forces land at Vera Cruz in Mexico during the Mexican-American War.  This was the largest amphibious landing in US history until World War 2.

1862 - The first clash of ironclad warships took place in the Hampton Roads as the CSS Virginia and USS Monitor fight to a draw after a 5 hour battle.

1916 - 1,500 Mexican raiders led by Pancho Villa attack Columbus, New Mexico - killing 19 and leaving the town in flames.  The US will dispatch 6,000 troops under General Pershing to try to catch Villa.

1945 - US B29 bombers start an incendiary bombing campaign against Japan -targeting Tokyo with 344 aircraft dropping incendiary bombs that started a firestorm that destroyed 16 square miles of the city and killed between 80,000 and 130,000 civilians.

1959 - The Barbie doll makes her debut at the American Toy Fair in NYC

1964 - The first Ford Mustang rolls off the assembly lines

1975 - Construction begins on the Alaskan oil pipeline

1989 - A strike forces Eastern Airlines into bankruptcy

1996 - Comedian George Burns dies at the age of 100

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