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. But I can't by law give you advice, and I do make mistakes. Remember: the unexpected sometimes happens. Oddly enough, the expected does too, but all too often it takes longer than you thought it would, or on the other hand happens more quickly than you expected. The Goddess of Markets punishes (eventually) greed, folly, laziness and arrogance. No matter how many years you've served Her. Take care. Be humble. And don't blame me.

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

Monday, January 13, 2014

US December Labour Market Data

Some of the US labour market stats were "strong"; other "weak".  So what I did was create a labour market composite index of the labour market variables I consider key.

The chart below (click on it to get it full size; and apologies for its less-than-satisfactory readability --- I'm still working on the program which I wrote to create graphs and indices) shows the year on year % change in real GDP and my index.  Consider this a work in progress, which it (especially the plotting program) is.  The shaded areas show the periods of NBER-determined US recessions.  Note how the labour market index starts turning down before the recession and turns up slightly before or coincident with the beginning of recovery.  Key point: note that there are no signs of an impending downturn.

The chart below shows the same series for a shorter period. The conclusion is clear. Remember that GDP "data" tend to get revised a lot, especially for recent years.

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