December 2013 Unemployment Falls To 6.7%, Total Nonfarm Jobs Up Only 74,000

The employment situation report for December 2013 is here.

The headline rate falls to 6.7% ending 5 years of unemployment at or above 7%, with massive numbers of people continuing to leave the labor force.

In the last year the number counted as unemployed fell 1.9 million, while nonfarm employment grew at a rate of 182,000 per month in 2013 vs. 183,000 per month in 2012, or 2.18 million. Roughly a wash.

Total nonfarm employment continues below the 2007/2008 peak of 138.1 million, still lagging that level by 1.2 million fully 6 years later (seasonally adjusted) despite growth in the population since that time of at least 14.3 million.

The headline unemployment rate has fallen from 7.9% at the beginning of 2013 to 6.7% at the end largely because those not in the labor force increased by 2.89 million in the last year (not-seasonally-adjusted). The not-seasonally-adjusted level reached a new high at 92.338 million. People who leave the labor force are not counted as unemployed.

In the 8 years from 2001 through 2008 under Bush those not in the labor force increased by 10.3 million, or 14.7%. That record has already been matched under just 5 years of Obama: 11.3 million have left the labor force, or 14.0% (numbers seasonally adjusted).

The civilian labor force participation rate, the percentage of working age people actually working, remains mired at Carter administration levels from 1977 and 1978.

 

Drudge's New Headline Writer Can't Spell To Save His Life: Makes At Least 6 Errors This Morning

knockout

roommate

opponents'

children's

anti-Semitic

Fournier

Rush Limbaugh Today Totally Botches Income Quintiles On The Program

"You keep using that word. I do not think it means what you think it means."

The relevant passage is here:

Poverty is expressed as an income level. Most economists break down income in America to five brackets, called quintiles, and people move in and out of these. The top quintile, I think, is like a million plus, and that'd be the top 1% of 1%. I forgot what the breakdown is, but the poverty level, it's roughly, what, $14,000 for a family of four? It's around there. People move in and out of these all the time.

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This is rich.

A quintile in this instance is one of any of the five groups of American households divided into those five groups based on how much money they make.

By definition, then, the top quintile is the richest 20% of households in America. So it's impossible for the top quintile to be "the top 1%", let alone "the top 1% of 1%".

As embarrassing as that is, Rush has absolutely no concept what it means to reach the top 20% of household income in this country.

The fact is it doesn't take all that much, and certainly nothing close to $1 million, hard as it may be to get there.

Currently the point in the middle of the top 20% of households by income is only about $181,905 per annum. That means about half the people in the top quintile make more than that, and about half make less. And interestingly enough, the middle of the richest 5% of households in this country isn't anywhere close to $1 million, either. The average household income of the top 5% is just $318,052. (For a good presentation of the data, see here.)

And Rush is equally out of touch about what it means to be poor. The federal definition for a family of four is about $23,500, not $14,000. The latter is about what it means for just one person to be poor, not four (see here).

Rush Limbaugh complains constantly about the sorry state of public education in this country. He even did so today in the same segment:

[L]ook at [President] Johnson's solutions. Education, job training, medical care, housing. That hasn't changed. The same weapons, the same language, the same way they tug at heartstrings. It's 1964, and they keep using the same lingo, obviously because it works. But look at how our education system's been since 1964 with them in charge.

Yep. Look at how it's been.

Rush is Exhibit A . . . the most popular radio host ever for a reason.

24hour Minimum Temperatures In The Lower 48 Yesterday And Today

Hey, Uncle Si Will Take Your Underwear Clean Off Your Butt!

Hey Obama! We Could USE A Prolonged Period Of Excessively High Temperatures Right About Now!

click image to enlarge

click image to enlarge

Polar Temperatures Well Below Zero Invade The Heart Of America

Temperatures before 8:00 AM Eastern:

"Ben Bernanke Has An Almost Unbroken Record Of Being Wrong"

Bye Bye Ben.

Seen here:

Ben Bernanke has an almost unbroken record of being wrong.

In 2006, at the zenith of the housing bubble, he told Congress that house prices would continue to rise. In 2007, he testified that failing subprime mortgages would not threaten the economy.

In January 2008, at a luncheon, he told his audience there was no recession on the horizon. As late as July 2008, he insisted that mortgage giants Fannie Mae and Freddie Mac, already teetering on the verge of collapse, were “ adequately capitalized [and] in no danger of failing.”

Following the Crash of 2008, Bernanke’s prognostications did not much improve. Nor did Yellen’s, who had also misjudged the housing bubble, and who became Fed vice chairman in 2010.

The two of them got the “recovery” they predicted, but the weakest “recovery” in history.

Peter Wallison Says The Housing Bubble Is Back

Here in The New York Times, where he blames sub-prime down payments, not interest rates:

Between 1997 and 2002, the average compound rate of growth in housing prices was 6 percent, exceeding the average compound growth rate in rentals of 3.34 percent. This, incidentally, contradicts the widely held idea that the last housing bubble was caused by the Federal Reserve’s monetary policy. Between 1997 and 2000, the Fed raised interest rates, and they stayed relatively high until almost 2002 with no apparent effect on the bubble, which continued to maintain an average compound growth rate of 6 percent until 2007, when it collapsed. ... Between 2011 and the third quarter of 2013, housing prices grew by 5.83 percent, again exceeding the increase in rental costs, which was 2 percent.

Many commentators will attribute this phenomenon to the Fed’s low interest rates. Maybe so; maybe not. Recall that the Fed’s monetary policy was blamed for the earlier bubble’s growth between 1997 and 2002, even though the Fed raised interest rates during most of that period.

Both this bubble and the last one were caused by the government’s housing policies, which made it possible for many people to purchase homes with very little or no money down. ...

When down payments were 10 to 20 percent before 1992, the homeownership rate was a steady 64 percent — slightly below where it is today — and the housing market was not frothy. People simply bought less expensive homes.

Obama Has Completed 160 Golf Outings In The Last 5 Years: The Practice Hasn't Helped

White House Dossier here reports that the president golfed 9 out of the 15 days while on his Hawaiian vacation, which means Moochelle was pretty much a golf widow during the time.

She did not return to DC with her family. The cost to the taxpayers of this early "birthday gift" of an extended stay may come to as much as $200,000 or more according to a separate entry here.

The Washington Times noted here the family's vacation was already "regal", and featured a video in which the president misses a long put on a green and then takes what he clearly deems a "gimme" but misses it, and picks it up off the green, not out of the cup. I'll bet his scorecard is minus the stroke . . . a lie like everything else about these people.

We Will Barry You

h/t Theo

Vanguard's Worst Performing Bond Funds In 2013

Long Term Treasury Fund, VUSTX:                          -13.03%

Long Term Government Index Fund, VLGSX:     -12.74%

Long Term Bond Index Fund, VBLTX:                       -  9.13%

Inflation Protected Securities Fund, VIPSX:          -  8.92%

Long Term Corporate Bond Index Fund, VLTCX: -  6.86%

Long Term Investment Grade Fund, VWESX:       -  5.87%

And as badly as they have performed, I don't see a net asset value for any fund which represents a bargain: they all still look too expensive to me. 

Antarctic Global Warming Scientists Rescued, But Rescue Ship Also Gets Stuck In Ice: Story Never Mentions It's Summer In Antarctica

Chinese Snow Dragon stuck in ice after rescue

Why would they go there at this time if they didn't think they could get to Antarctica?

The story is here.

Evidently the rescue ship is Chinese, but the scientists were transported from their stuck vessel to an Australian vessel which subsequently has been dismissed from the area despite the troubles of their rescuers' vessel, also now stuck.

Reminds me of the tow truck which came to retrieve a neighbor's dead vehicle the other day. The tow truck itself got stuck, and had to be towed by another tow truck. Needless to say the neighbor's vehicle didn't get towed until yet another tow truck came yesterday.

And that's how icy it is, from Antarctica to Michigan.

Current Fair Value Of The S&P500 Is . . . 1005

Doug Short updates his regression analysis for the S&P500, adjusted for inflation, to come up with the S&P500 today about 80% above the long term trend going back to 1871:

"If the current S&P 500 were sitting squarely on the regression, it would be around the 1005 level. If the index should decline over the next few years to a level comparable to previous major bottoms, it would fall to the 450-500 range."

Charts and discussion here.

Obama's Unemployment Level Is Still 20% Worse Than It Was Under Reagan And Remains The Worst In The Post-War

The average annual unemployment level in the post-war has never been worse than under Obama.

The unemployment level under Obama 2008-2013 still averages above 12 million.

The unemployment level up to the election of Obama reached an annual average of 9 million.

Government Just Made Two Things You Liked Obsolete: Your Health Insurance And The Lightbulb

Tim Carney, here, says the government ban on the traditional lightbulb is a case of crony capitalism in which industry persuaded government to help it increase energy efficiencies profits by eliminating the bulbs which consumers preferred in order to give them bulbs they didn't want but which cost a lot more, boosting profits they couldn't otherwise make.

You know, just like ObamaCare gives you coverages you neither want nor need and makes your insurance much more expensive than it used to be, and forces everyone to buy it. Insurance companies are happy to get all the new customers, and all the extra profits.

Big business is the enemy of Americans, and of capitalism. Unfortunately, so is the government.

Jobless Claims Average 435,000 Per Week In Last Month, 17.75 Million Total In 2013

The report for the last week of 2013 is here.

At the current average per week in the last month sustained over a whole year the result would yield 22.6 million first time claims. That doesn't square with the claim that the economy is now in full trot as one headline puts it this morning.

17.75 million actual first time claims for unemployment in 2013, not-seasonally-adjusted, represents the best showing yet under Obama, but still far above George W. Bush's best years in the 16 million range when participation rates were much higher.

With nearly 12 million people having left the labor force since Obama was elected in 2008, far too many of those still working in a much smaller labor pool continue to lose their jobs every week. The levels today only seem less alarming because we remember them from when labor force participation rates were much higher. Now that they are not and levels are still high shows that labor is still flat on its back in this country.

If this is the best Obama can do, it's going to be a very long three more years.

Obama's America: Nearly 12 Million Have Given Up And Left The Labor Force Since His Election

In April 2011 over 1 million people, desperate for work, applied for just 50,000 burger-flipping jobs at McDonalds, which ended up hiring 62,000, 24% more than planned.

Where are the other 938,000 today?

The story is still here, thanks to former Mayor Bloomberg.

Those 938,000 most likely ended up joining another 10 million-plus who have left the labor force altogether.

President Obama meanwhile enjoys day 12 today vacationing in Hawaii snorkeling and golfing, according to news reports, after all his hard work fundamentally transforming the country.

Nearly 12 million have left the labor force since Obama's election in '08

Vanguard's VTSMX Makes New All Time High At 46.67 Today, 53rd And Final New High Of 2013

What a year for this fund: an average of one new high a week, plus one.

John Crudele Of NY Post Still Not Really Sure What The Fed Has Been Trying To Do

Here in "Bernanke's rate ploy robs from middle class" John Crudele of The New York Post still can't seem to put two and two together even after all this time:

1:

Bernanke, who is leaving his job next month, controls something called the Fed Funds Rate. That’s the rate at which banks can lend each other money for a very short term, generally overnight. That rate is set by the Fed and has been stuck at a puny 0.25 percent for the last few years as the Fed tries to — well, I’m not really sure what the Fed has been trying to do. ...

2:

One of the few rates he has been able to keep low is the yields on things like money-market and savings accounts. The banks love him, since the less they pay out to depositors, the more money they earn.

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What do I gotta do, John, spell it out for ya?

The Fed has been trying to . . . rescue the banks. They don't keep the rate next to zero for this long if they didn't need to.

The middle class has been punished in the process, but lower interest rates presumably have allowed some in the middle class to refinance expensive loans at lower rates while their retirement investments have reflated. That's the rationalization, if not the reality experienced by most.

The banking crisis is over when ZIRP is over.