4/1/11…two ‘R’ words

Non-Farm Payrolls rose by 216,000, vs consensus for 190k, in March with civilian jobs rising by 160k. February was revised to +194,000, a gain of 2,000, while January was revised to +68k, a gain of just 5k, both lower than anticipated revisions. Factory Jobs increased by 17k while Construction declined by 1k. Private sector jobs increased by 230k while government subtracted 14k…some stimulus there…happy now GOP and teabaggers? Remember the multiplier effect? Total hourly earnings were UNCHANGED, and up just 1.7% from a year ago – no help for consumption there!

Meanwhile the Unemployment Rate declined by 0.1% to 8.8% – stop cheering and add in discouraged and part-timers though and you get 16.2% and that is down 0.5% for the month and down 1.1% for the two months but due to a surge in January, down just 0.4% from yearend. The participation rates has been steady at 64.2% for three months and down 0.7% from a year ago!

Market Reaction (8:45am EDT): Bonds continuing to decline with 10 yr note -3/8 to 3.51% and long bond -9/16 to 4.54%. Gold is now -$10 to $1430 and Crude is holding on to its overnight gains at $107.27. Dollar is modestly higher. Stock futures holding at pre-release levels: DOW +64; SPX +7; NDQ +13…rock and roll!

Bloomberg Top Stories:

*Stocks Climb in Europe, U.S. Futures Gain Before Jobs Report; Yen Weakens

*Foreign Banks Tapped Fed’s Lifeline (and BofA!) Most as Bernanke Kept Borrowers Secret

*ECB Set for First Rate Split With Federal Reserve3 in 40 Years

*Irish Count on $142 Billion Package to End Crisis as Bank of Ireland Bows to Trichet

*Bernanke Cash Drives Junk Bond Frenzy as JPMorgan Faces Record Competition

*European Ports Brace for delayed Impact of Japan Disaster

*Libya Rebels Seek Cease-Fire After U.S. Vows to Withdraw Jets by Tomorrow – WTF???

*Qaddafi Exile Options Span Uganda to Venezuela as Libyan Defections Possibilities

The spell is broken! Yesterday’s 1.08 billion shares was the first 1B day in EIGHT sessions, and although about 100 million below average showed some life going into QE2. BUT that was tempered by the fact that until the final 15 minutes it was the LOWEST of the past five sessions…therefore window dressing and rebalancing by index funds on the close providing the oomph to pierce 1B. A profile of the Dow tells the story: opened little changed, slipped to slightly negative thanrallied to 12381 – the session high at 10:30am EST, then negative up slightly then down from 2:15pm for the rest of the session, closing at the low, 12319! Even counting that other 1B share day nine days ago the average has been just 885 million shares…hardly worth turning on the lights. Indices were mixed and Advance/Declines and Breadth were juxtaposed with A/d positive about 1.5:1 but Breadth modestly negative. There were 549 new 52 week highs! While new lows rose to 54. The rally in bonds ended abruptly when the President of the Minneapolis Fed said he is in favor of raising rates 0.75%…a split is appearing…you would never have seen this under Greenspan…perhaps dissent is a good thing though, no? Volatility (VIX) remains complacent at 17.74.

Overnight, global equities are rallying…new quarter! Europe up from 0.7% on the CAC 40  to 1.2% on the DAX, while Asia saw a 1.2% rise on the Hang Seng +1.2%, Korean Kospi +0.7%, but the Nikkei -0.5% (TOPIX -0.8%), and the hot of late Indian SENSEX -0.1%. The slump is continuing pre-payrolls with most of the curve -1/8 and the long bond -1/4. Gold is $1435.60 -$4.30, while Crude is up again by 54 cents to $107.26. Dollar steady ahead of payrolls.

Here are the Q1 and 12 month stats:

Dow +6.4%; +12.8%

Dow Transports +3.8%; +20.7% (but Nasdaq Transport -2%!)

Dow Utilities +2%; +7.8%

S&P 500 +5.4%; +12.5%

Nasdaq Composite +4.8%; +15.8%

Nasdaq 100 +5.5%; +19.4%

Russell 2000 (small cap) +7.6%; +23.3%

TLT (long bond ETF): -1.5%; +7.5%

LQD (Corporate ETF): +0.6%; +7.1%

HYG (junk bond ETF): +3.2%; +13.3%

MUB (national muni ETF):+0.9%;  -0.2%

PFF (preferred stock ETF): +3.4%;+10.1%

GLD (ETF): +0.8% ; +26.8%

OIH (Oil Services ETF): +17.2%; 33.8%

(All ETF’s assume dividend reinvestment in the ETF)

TB’s Quote of the Day: “It is hard to respect people who have no self-respect or respect for others.” – TB

TB has turned BULLISH – OK the April fool’s joke is over! Now back to reality:

…restraint and respect…sorely lacking today in America. People have been empowered by the internet (TB included). Is it the biblical ‘tree of knowledge, of good and evil?’ It has the power to do both and like in Egypt, TB believes it will be an integral part of a revolution (peaceful and through the polls hopefully), that is surely coming as the enormous wealth gap continues to widen, sinking the American dream. How much hope exists in inner city areas where kids learn to become drug dealers or pimps, join gangs and have no respect for the law or authority of any kind? Where education funding is about to be slashed and it is better to die young and have experienced the good life than to try to live a good life. What would the founding fathers think of how we have squandered the great gift they gave us and the sacrifices they made? How would it be to  have died for your country in one of the wars of the past century and see what people did with the gift you gave them? TB is certainly glad to have served his country but even more glad that he didn’t have to make the ultimate sacrifice…for what? People who don’t give a damn about other people? Who use the argument of ‘balancing the budget’ to sell their ideology? That is the world we live in…sadly. Where are the leaders?…enriching themselves at the trough…either of the public or dumb shareholders.

. . .  – – –  . . .  . . .  – – –  . . .

A friend and former shipmate sent this to TB. Compare what happened in the Japanese disaster to what happens here when there is a catastrophe. They had no looting, people rose to the occasion, civilization and culture continued as before and above all they kept their decency and respect. Does anyone remember how responsibly Americans acted at Pearl Harbor? The twin towers showed signs of bravery too, but that event was so shocking that people didn’t know what to do. Praise for the Japanese people.

Not a single visual of chest-beating or wild grief. Sorrow itself has been elevated.

2.THE DIGNITY Disciplined queues for water and groceries. Not a rough word or a crude gesture.

The incredible architects, for instance. Buildings swayed but didn’t fall.

People bought only what they needed for the present, so everybody could get something.

No looting in shops. No honking and no overtaking on the roads. Just understanding.

Fifty workers stayed back to pump sea water in the N-reactors. How will they ever be repaid?

Restaurants cut prices. An unguarded ATM is left alone. The strong cared for the weak.

The old and the children, everyone knew exactly what to do. And they did just that.

They showed magnificent restraint in the bulletins. No silly reporters. Only calm reportage.

When the power went off in a store, people put things back on the shelves and left quietly.

Oh, they do share one thing with Americans: they don’t believe the government on the risks. Also, like the U.S. the two parties are not working together but vying for more political power. Is this the universal given?

Have a relaxing weekend!




  1. LDH said

    trader b, a superb graph by calculatedriskblog.com is updated this morning, and overlays job loss, then job recovery for all post wwii recessions. you can really get a sense of scale for this last debacle. check it out, and have a great weekend, too. nice thoughts on japanese dignity, too. thanks

    • traderbill said

      Thank you for your comments and for reading! TB

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