Disclaimer. After nearly 40 years managing money for some of the largest life offices and investment managers in the world, I think I have something to offer. These days I'm retired, and I can't by law give you advice. While I do make mistakes, I try hard to do my analysis thoroughly, and to make sure my data are correct (old habits die hard!) Also, don't ask me why I called it "Volewica". It's too late, now.

BTW, clicking on most charts will produce the original-sized, i.e., bigger version.

Thursday, June 7, 2012

So, about those numbers

The employment report and the ISM numbers were soggy but not yet disastrous.  Payrolls rose a scant 70K or so in May, and what is to me more concerning, previous data were revised down.

The chart below shows the change in the unemployment rate over six months, inverted, since unemployment rises when economic growth is low or negative.  The change (i.e., the decline, but shown above the zero line 'cos it's inverted, OK?) in the unemployment rate was running at the highest levels in nearly 3 decades.  And it's slowed back to a rate of decline consistent with previous recoveries.  So not that bad. Yet.

Click on image to get a bigger picture

The slide in the combined ISM survey results is more worrying.  I've "extreme-adjusted" the data, which uses a statistical technique invented by the NBER in the US to remove or reduce "spikes" in the data.

If these soggy numbers were happening in just the US, I wouldn't be so worried. But they aren't.


  1. So, where are these numbers from? Are they just Australia? USA? Worldwide (and, if so, weighted in some manner?)