Research for Online Investors
Economic reports rolled in this
morning before the market opened from around the world…and it doesn’t look encouraging. The backbreaker was the ADP U.S. Non-Farm Employment report that indicated only
119,000 jobs added last month. This was down from 201k jobs added in
March and below expectations of 177,000. The March number was originally
reported at 208,000. Funny how those initial reports always sound
Overnight, European economic numbers
caused concern. A quick rundown; Hungarian PMI 46.9, Spanish
Manufacturing PMI 43.5, French Manufacturing PMI 46.9, German Manufacturing PMI 46.2, German Unemployment UP at
6.8%, European Union Manufacturing PMI 45.9, Italian Unemployment bounced higher to 9.8%, and European Union
Unemployment rate at 10.9%
The Japanese monetary base actually
shrank last month by 0.3% and the HSBC Chinese Manufacturing PMI was 49.3 Do these numbers represent a continent, or a world economy on the
France’s election is this
Sunday. Candidates Nickolas Sarkozy and Francois Hollande face off in a
two and a half hour televised debate this evening. Hollande is leading
but handlers have tried to lower expectations as he has no personality and less appetite for hard
questions. Sarkozy is seen as an excellent debater and has veered to
the right to pick up followers of conservative candidate Marine Le Pen. Le Pen has announced she will cast a blank ballot.
The Treasury Borrowing Advisory
Committee has recommended that Floating Rate Treasury Bills should be issued by the U.S. The Wall Street Journal reports the Treasury Department has not made a decision on the
recommendation. Floating Rate Treasuries would allow the government
to issue debt that actually had negative interest rates. Investors
could pay the U.S. Treasury to buy their bonds.
Economic reports will be the markets
noose or stairway this week. Tomorrow Initial Jobless Claims for last
week come out before market open and Friday morning the Bureau of Labor Statistics “Official” Non-Farm Payrolls and
Tomorrow the European Central Bank
will announce interest rates going forward. They are expected to remain
unchanged at 1.0%. Business Week has an article about Germany’s slowing economy, but the population is
concerned about inflation. A quarter point reduction in interest
rates by the ECB could be an outlier tomorrow morning.
of Krugman's article. It strikes me as a tale of easy money versus hard
money. Both have consequences. However, since we have a consumption
based economy, making more and more money available to more and more people will always win. With rare exceptions, politicians will not opt for any policy that will distress
their constituents. They'll be tossed from office
otherwise. Advantage Krugman—subsciber J.R.
John’s reply: What the people don't understand is the "feel good" of 4% inflation leaves a nasty
taste in your mouth and pocket.
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