Category: Economics

U.S. Employment Gains Help Stocks Pare Losses


A bearish trend in U.S. equities was disrupted last Friday on better U.S. employment data, but a recent study on income and poverty shows better employment is benefiting men more than women and unmarried households over married ones.

The Bureau of Labor Statistics reported an increase of 248,000 jobs in September, while employment for August was revised up from a gain of 142,000 to a gain of 180,000. The headline unemployment rate fell below 6% for the first time since the financial crisis of 2008, reaching levels last seen in 2004.

The Iron Ore Shipping Business is Facing Some Rough Seas


The impact of Chinese demand on global iron ore prices is well known. A less acknowledged consequence of China’s emergence is the transformation of incentive structures in the global shipping market. Dramatic increases in freight rates shifted global iron ore producers’ comparative advantage further in favour of Australian exporters to the detriment of the Brazilians.

ISIS manipulates President Obama into military response


Before he took office, President Barack Obama predicted that war in Iraq would recruit more terrorists to the jihadist cause. Now he is US leader, Obama has neglected to heed his own warnings. 

Average Americans Grow Poorer as U.S. Per Capita Wealth Reaches New High


America is richer than it has ever been in human history, according to a study by the Federal Reserve.

According to the Federal Reserve’s measurement of households and nonprofit organizations’ total assets (HNOTASQ027S), American total wealth per person soared to over $309,000 by September 2014, up over 38% from its post-crisis low in 2009. 

In total, Americans own over $95 trillion in assets. Over 70% of those holdings are financial assets held in instruments like common stock, bonds, and other asset-backed securities.

Dollar Strength Persists in the Wake of Weak Eurozone and Japanese Data


Ahead of the ECB’s meeting on Thursday where details of the ABS/covered bond purchase scheme are expected to be delivered, the market is particularly sensitive to developments that could spur a strong policy response.  Today’s preliminary September CPI figures were seized upon to drive the euro to fresh lows, against both the dollar and sterling.  

U.S. Industrial Production Falls Despite Low Oil Prices


Industrial production in the United States suddenly contracted despite more optimistic expectations of stable or growing production.

According to the Federal Reserve survey on industrial production and capacity utilization, total industrial production fell 0.1% in August and manufacturing fell 0.4%, reaching a seven-month low. While remaining 24.3% above the recession low, industrial production disappointed analysts who expected a U.S. recovery in manufacturing to drive the index higher.

Fed Sees Jobless Epidemic as U.S. Equities Decline


Stocks in the U.S. saw one of their steepest declines late last week on worries that the Federal Reserve will begin tightening its monetary policy this week. Bond yields also rose in last week trading, with the 10-year U.S. Treasury rose over 15 basis points in a month to 2.62%. Some analysts believe the sell-off is likely to continue as several metrics point to a much-needed correction in equity markets.

Optimistic outlook for small business and a sharp rise in job openings


Job openings rose 22% year over year in July, according to a new report by the Bureau of Labor Statistics. A total of 4.7 million job openings were posted in July, compared to 3.8 million in July 2013 and 4.7 million in June.

The number of job openings has risen sharply in 2014 after slumping slightly in February on cold weather, a sign that businesses are investing more heavily for growing demand in the U.S. economy. Private industry jobs grew 22% year over year to 4.2 million, while government job openings rose 26% in the same period to 485,000.

Yes, the Strong Dollar Hurts Earnings, but so does Weak Demand


How much of a headwind is international exposure causing US-based companies?  Factset did a study earlier this month, drawing on a combination of companies that had already reported Q3 earnings and used estimated results for those who had not reported. 

The Economics Of The Illegal Wildlife Trade


The illegal trade of animals or animal parts has become one of the most lucrative black market activities in the world. Driven by the promise of high profit margins, poachers in Africa – namely militias, armed groups, and insurgent groups – have driven rhinos and elephants close to extinction, while murdering hundreds of park rangers in the process.  NGOs and governments now face a race against time to reduce demand for wildlife trade, particularly in Asia, as well as to equip those on the frontline to fight a well-armed enemy.