From CNBC:
Unemployment rate falls to 3.5% in September, payrolls rise by 263,000 as job market stays strong
Job growth fell just short of expectations in September and the unemployment rate declined despite efforts by the Federal Reserve to slow the economy, the Labor Department reported Friday.
Nonfarm payrolls increased 263,000 for the month, compared with the Dow Jones estimate of 275,000.
The unemployment rate was 3.5% versus the forecast of 3.7% as the labor force participation rate edged lower to 62.3% and the size of the labor force decreased by 57,000. A more encompassing measure that includes discouraged workers and those holding part-time jobs for economic reasons saw an even sharper decline, to 6.7% from 7%.
September’s payroll figure marked a deceleration from the 315,000 gain in August and tied for the lowest monthly increase since April 2021.
“Depending on your view of optimism vs. pessimism, on the economy, there’s a little bit of something for everyone in this report,” said Liz Ann Sonders, chief investment strategist at Charles Schwab. “Obviously, the market is not happy, but the market is not happy in general these days.”
…
“This puts the nail in the coffin for another 75 [basis point rate increase] in November,” said Jeffrey Roach, chief economist at LPL Financial. A basis point is 0.01 percentage point.
Someone just blew up the Kerch bridge (the huge 12 mile bridge linking Russia to Crimea) in a pretty spectacular explosion. Shit’s getting real now. Ukraine wants Crimea back now too.
https://image.cnbcfm.com/api/v1/image/107131442-1665221167357-gettyimages-1243810869-AA_08102022_893867.jpeg?v=1665221438&w=929&h=523
Ukrainian officials responded to the explosion Saturday without directly acknowledging that Ukraine was responsible for the explosion.
“Air defense of the Russian Federation, are you sleeping?” the Navy of the Armed Forces of Ukraine said on Facebook, alongside a video showing a section of the bridge’s road that had been completely destroyed.
“Russian illegal construction is starting to collapse and catch fire. The reason is simple: if you build something explosive, sooner or later, it will explode. And this is just the beginning,” David Arakhamia, the head of Ukrainian president Volodymyr Zelensky’s party in parliament and a member of Kyiv’s negotiating team with Russia, said in a Telegram statement about the incident
Lol…
https://ktla.com/news/local-news/california-inflation-relief-checks-go-out-today-everything-you-need-to-know/amp/
Ukraine twitter acct posts #sickburn
Happy birthday Vlad.
https://twitter.com/Ukraine/status/1578634825417650176?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1578634825417650176%7Ctwgr%5E0afc12d4a2b2c879283e9149b8f9514d75980b1f%7Ctwcon%5Es1_&ref_url=https%3A%2F%2Fwww.cnn.com%2Feurope%2Flive-news%2Frussia-ukraine-war-news-10-08-22%2Findex.html
“This is the big one. You have never seen nor will you ever see a crash like this again. This is “The Great Reset” or the “Stock-Bond Correlation Crisis”
Generational losses and opportunities will be made.”
Hunter Biden:
*needs to give back the $640 million he made as a “White House advisor”
*The $2 billion in blood money he got from Crown Prince Mohammed Bone Saw
*The patents he got from China
*The $6.35 million in PPP loans
Oh wait all this corruption was Ivanka & Jared Kushner!
Jared got $2b from Saudi Arabia.
Nothing to see here.
That Cali tax rebate. I hope those debit cards don’t mail with the PIN number on them. If they do, they are all going to be stolen.
Ex/Genius,
Yet Pelosi still refuses to stop inside trading.
That are all the same. Crooks!
Insider trading – not quite the same act – as selling US security to a rouge nation with a history of its denizens hurling jets into American skyscrapers.
Ex- Get your DNC taking points straight when you do the what about Jared routine. Nobody is accusing him of cheating on his taxes and doing drugs with hookers.
It was a 2 Billion dollar investment from the Saudi Kingdom sovereign wealth fund to a private equity firm Affinity Partners.
They have invested money, for example in green energy they invested in a startup Mosaic, an Oakland, Calif based fintech company that provides loans for residential solar installations.
Remans to be seen if the Saudi’s will get their money back or maybe even allot more than they put in.
They need to fire a few more rockets at that rail bridge.
The floating HIRMARS warning tweet last month BTW was epic.
Link..
https://tinyurl.com/2t22ez8b
Wayne makes the news. How grubby is this:
https://abc7ny.com/diner-wayne-new-jersey-accused-of-charging-kids-extra/2619256/
Ha, this is rich.
Now the Poles are angry with the Norwegians cause Norway wants to keep it’s capitalistic profits. Why should they share any money with Ukraine, who was taking a vig from the Ruskies? Norway should tell them to pipe down or double the price on them.
Poland’s prime minister has urged Norway to share its “excess, gigantic” profit with Ukraine, accusing the Oslo of indirectly “preying” on the conflict.
“It is not our fault that Putin is waging this energy war on Europe,” said Lan Marie Nguyen Berg, a member of parliament representing the Norwegian Green Party. “But we can decide what we want to do with what we earn from this.”
“Still haven’t touched anything.” [stocks, not otherwise…]
“Closing shorts for the week. I’ll take a -4% day on the Nasdaq.”
Nice, both you guys…
I de-risked, dumped some stuff that was a quick up recently for less than what I should have made but any green in this market is better than red…piled into my go-to VIX trade harder, liking dynamics I’m seeing there…
Shorted CALM right before their earnings, not a usual trade for me but it was so hyped on every outlet and had a huge runup into earnings (which weren’t bad)…the 5-6 point decline there helping me out, as well as a (much too small) TREX long….
One position I got out of entirely in my main and 50% out of in my IRA is going to make my Monday interesting…I’m too old and been doing this too long to get fucked by stubbornness, but here we go again…
SPYs I put on this/last month still green, only because of hedge…it absorbs anywhere from a quarter to a third of movement each direction, depending on the day…
Serious question for you two guys, chi, noone….
I keep hearing reiterated everywhere that ‘2023 earnings need to come in 20% to around 200’…unless I can’t read basic data that math is just not correct, the 20% referenced decline is off of forecasts, not off of 2022, which is where 20-down in a recession comes from, off prior year actual, not forward forecast….
The trajectory of earnings relative to the expectations concerns me deeply…the data says LTM earnings for SPX are 218 on an LTM basis, 20% off of there is +/- 180…that 180 puts us higher than the wide open, free money years of 2018 (162) and 2019 (163)…once you stack 2022 on top of these two years (ignoring the huge distortions of 20/21) that 180 looks not unreasonable for even a no-recession scenario….if people are running ‘downsides’ using 200 that ‘downside’ would be 25% up from those stacked years, pretty good when looking at the LT earnings series of SPX 200 is supposed to be analysts downside not yet priced in…also 200 for 2022 would imply 10% down for each of Q3 and Q4 2022, ruh-roh….if 3Q and 4Q 2022 do not decline and current forecasts hold SPX 2022 comes in at 223….that implies the recession is pushed to 2023 in which case the not-yet-priced-in-earnings of 200 in 2023 is only a 10% from 2022A? Not passing the reasonableness test here….
And, notably in the background of all the analysis is that in 2019 (a wide open free money year) earnings were rolling already, being flat essentially from the prior year.
I’m getting more and more concerned about earnings and guidance relative to expectations. Six days to figure it out before the starting gun goes off…
Some more data, graphs this time.
Lib, see any interesting lines to draw?
https://www.yardeni.com/pub/yriearningsforecast.pdf
“If we were smart we would have imported a million talented Ukrainians.”
But then they would have been fully processed and coming in through the front door…don’t you know no person is illegal?
And OMG the ethnic overtones here…Caucasians? You racist motherfucker, you need to be cancelled…
11:55 a lot is two words
Filipino teachers come to America to help drive teacher’s wages down:
https://www.washingtonpost.com/nation/2022/10/02/teacher-shortage-bullhead-city-arizona/
Left,
US stocks and SPX aren’t my thing. The direction is definitely down for EPS, with the caveat that inflation inflates the topline but also the cost side. Strong dollar should also hurt US multinational earnings. Sell siders don’t like to cut EPS until management gives a signal to do so. Maybe cuts are coming late? International index earnings have been falling all year, probably declining in 22.
Had a Fridge delivered by Home Depot today. F*ckers refused to install it. I’ve run into an awful lot of lazy workers lately that don’t do their jobs.
Leftwing,
I’d love to see their forecasts for this year, from last year.
BRT
Ice / water hookup? They wont touch the plumbing, too much liability if there is a leak. They wont install a gas appliance either. Have to pay extra to have a plumber from the install services desk do the work.
Go Guards!
Happy Sunday!
!https://www.dailymail.co.uk/news/article-11295403/Sleazy-teachers-exposed-One-flashed-boobs-kindergartners-held-sleepovers-home.html
Had a Fridge delivered by Home Depot today. F*ckers refused to install it. I’ve run into an awful lot of lazy workers lately that don’t do their jobs.
I needed an internet hard wire run into my home office during the Covid lockdown. I called and an made the appointment with the provider and stressed that I need a hard wire run from the router to my office because I didn’t want to rely on wireless. I made sure they were aware of what I needed. When they came (a week later or better), the fat lazy fuck said we don’t run lines. I didn’t want to get into it, didn’t want to ask what they do for new customers, etc. I should have cancelled everything but I couldn’t disrupt my work schedule. With the help of a friend, we snaked a line through the basement and up through an old cable outlet to my office. The question still remains: If I’m a new customer, do they tell people what their limited efforts are to supply service? Is there a list of “we don’t do that” items?
You get one room where the coaxial cable comes in and hooks to your modem.
That’s it. No cable company is going to wire your house. Don’t think they are ever going t do a second story unless it’s a separate apartment.
They don’t run CAT cable. If that is what you want, you need to hire a company to do that.
No cable company is going to wire your house.
They did in the past, more than once.
Just because someone doesn’t do what you want does not make them lazy.
The “lawsuit” has been the go-to for many Americans as a tool to profit, deny payment, stay in rentals they don’t want to pay for, escape liability for things, etc.
That’s why your plumber costs so much. Cause you want to sue for everything. Home Depot should just stop delivery altogether. I’d already wager it’s outsourced anyway to protect the parent company.
Enjoy your litigious society.
You sure that your call wasn’t routed to a third world country employee?
Cause many are. It’s what we do here. Hire the cheapest labor we can find, then complain about them. Press rookies into service like the cop that lit up the kid eating a burger.
Wage inflation isn’t keeping up with real inflation. Workers aren’t getting richer with wage inflation, they are getting poorer.
Bringing in a bunch of Ukrainians is just salt in the wound for working Americans.
Anybody who commutes to work or sends their kids to school notices traffic is equal to if not worse than pre-pandemic. Meanwhile, the stock and bond markets are telling us a deeper recession is coming.
It’s such a strange disconnect, largely due to a lag effect. It takes time for layoffs to happen after share prices plummet because it takes time to face reality and come up with a cost-cutting plan.
In fact, one of the reasons why proactively negotiating a severance is so effective is because it helps your manager decide. When making difficult decisions, like laying people off, we tend to kick the can down the road until we no longer have a choice.
The strong September jobs report of 263,000 additions to payroll helped lower the unemployment rate to 3.5% from 3.7%. As a result, stocks sold off aggressively given lower hopes of the Fed slowing or stopping its rate hikes. Expectations are for another 75 basis points hike again in November.
The Dilemma We Face
The situation highlights an important dilemma. Do you want to support your lifestyle by making money from your job or from your investments?
If you’re mainly focused on making money from your job and have little-to-no investments, you’re feeling relatively great in this environment of full employment and wage inflation. Only about 56% of Americans own stocks.
If you’re mainly focused on making money from your investments, like I am, you’re not feeling so great. You’re probably prepping more for tougher times because you better recognize a deteriorating future.
Given you’ve subscribed to this newsletter, more of you are likely part of the latter group. Although in reality, most of us are happy to earn money through both active and passive income.
If you find yourself in the first group but don’t like your job, you owe it to yourself to either find a new job in a hot labor market and/or start investing in a bear market. Eventually your energy will fade and the markets will return.
If you find yourself in the second group, then your goal is to continue dollar-cost averaging and wait out the storm. In the meantime, keep yourself occupied on more important things and read, How to Enjoy Your Life As The Fed Ruins The World.
Think in extremes to help find middle-ground solutions.
Enjoy your life, no matter the economic situation. If you do, then you’ll always be winning. The key is to recognize reality and take appropriate action.
If the Fed raises the Fed Funds rate to 4.5% and keeps it there while inflation and the stock market plummet, the world will be temporarily ruined. As the global recession deepens, millions will lose their jobs, banks will go bust, and trillions of wealth will evaporate.
All the good done by governments to support billions of people during the pandemic will have been for nothing. Can you imagine struggling through a pandemic for three years, finally coming up for air only to be run over by a speedboat driven by a rich central banker?
When you are worth ~$100 million, as Fed Chair Jerome Powell most certainly is, you may not care as much about the middle class as you do about your legacy. Instead, you want the history books to emphasize how you were tough on inflation and gloss over the human suffering caused by your decisions.
Maybe they did 10 or so years ago when prices fell in Bergen County, but not anymore
Fast Eddie says:
October 9, 2022 at 8:36 am
No cable company is going to wire your house.
They did in the past, more than once.
What’s crazy with rates this high….still lower than inflation.
20 years ago, cable guy wired my whole apartment in New Brunswick. But no one cared how it looked. So they ran it in places that were visible.
The guys from Home Depot wanted the shutoff valve at ground level instead of the basement. The shut off valve is literally 6 inches below the fridge location. This apparently is home depots new policy so the guys they send can just screw on a braided line…I talked the customer service rep and he said it was the safest way they can guarantee their work…but it was like “surprise, call a plumber and spend another $200”. This, btw, goes against manufacturer recommendations which says, uses a copper line. So I went to home depot, bought the tool to cut the line and a new compression sleeve and a new nut. $15…. Point was though, I didn’t have time for this crap yesterday. You can’t even pay people to do work anymore. They left the fridge in my garage and said call us when you are ready. So I moved it into the home myself, unpacked it, and did all their work.
Post from a forum. Everyone in Europe will be finding this out soon enough.
Hi all, a quick question since I moved to the area and never had propane before. I ran it for a week (kept the heat on at 68) and I noticed it gobbled up a fair amount of propane. Is this normal for the winter time here? At this rate it’ll cost about 1200$ every 6 weeks. What do you all do?
You can’t even pay people to do work anymore.
Sure you can, pay a plumber who makes enough to cover a potential lawsuit by a customer.
Ed – There was no need to run a wire.
https://www.techreviewer.com/learn-about-tech/ethernet-over-coax-a-complete-guide-to-moca-adapters/
You doing top down or bottom up. I would go P/E by sector if you go bottom up. Each has their own idiosyncrasies. E for AAPL is far more influential and prone to a higher P/E than XOM.
I understand your question relates to the E discussion. By definition, we are discussing a shortcut calculation/rule-of-thumb. So should the rule have any validity, it is giving a quick and dirty of a full blown DCF for each and every component of the SPX. As such, in producing the DCF, where is your E? It is the forward E’s…..
I understand the implicit nuance you are asking….. because when you consider the equation for terminal value, the numerator input is current cash flow.
Your concern is whether you are making a gross calculation error. The answer is off-course the market doesn’t give a shit…… it goes to the correct level no matter what your little spread sheet says……
leftwing says:
October 8, 2022 at 1:10 pm
Serious question for you two guys, chi, noone….
I keep hearing reiterated everywhere that ‘2023 earnings need to come in 20% to around 200’…unless I can’t read basic data that math is just not correct, the 20% referenced decline is off of forecasts, not off of 2022, which is where 20-down in a recession comes from, off prior year actual, not forward forecast….
The trajectory of earnings relative to the expectations concerns me deeply…the data says LTM earnings for SPX are 218 on an LTM basis, 20% off of there is +/- 180…that 180 puts us higher than the wide open, free money years of 2018 (162) and 2019 (163)…once you stack 2022 on top of these two years (ignoring the huge distortions of 20/21) that 180 looks not unreasonable for even a no-recession scenario….if people are running ‘downsides’ using 200 that ‘downside’ would be 25% up from those stacked years, pretty good when looking at the LT earnings series of SPX 200 is supposed to be analysts downside not yet priced in…also 200 for 2022 would imply 10% down for each of Q3 and Q4 2022, ruh-roh….if 3Q and 4Q 2022 do not decline and current forecasts hold SPX 2022 comes in at 223….that implies the recession is pushed to 2023 in which case the not-yet-priced-in-earnings of 200 in 2023 is only a 10% from 2022A? Not passing the reasonableness test here….
And, notably in the background of all the analysis is that in 2019 (a wide open free money year) earnings were rolling already, being flat essentially from the prior year.
I’m getting more and more concerned about earnings and guidance relative to expectations. Six days to figure it out before the starting gun goes off…
Yikes….. fucked it up…. it is forward cash….. so there…. no conflict now…. agreed?
chicagofinance says:
October 10, 2022 at 1:14 pm
I understand the implicit nuance you are asking….. because when you consider the equation for terminal value, the numerator input is current cash flow.