Posts Tagged ‘jobs market’
It’s less than two weeks prior to the Christmas break, and with the New Year on the horizon, that means it’s time to sit down and really re-evaluate your portfolio.
Now, we could see Santa appear and deliver our Christmas goods (i.e. additional gains) into January. What a wonderful way that would be to begin the year? But I will discuss what’s to come in 2014 in my year-ahead outlook in three weeks’ time. At this point, I’m not positive, but I think it’s going to take some work to make money in the New Year (Santa’s not likely to drop that off under your tree).
The days of the Federal Reserve’s flow of easy money into the stock market, which we witnessed over the last four years, will be steadily fading away unless, of course, the new Federal Reserve Chair, Janet Yellen, decides to extend the bond buying longer than necessary. She does love the use of loose monetary policy to prime the economic engine, just as the exiting Federal Reserve Chair Ben Bernanke did for years.
Naturally, a lot of what the Federal Reserve does will circle around what’s happening in the economy.
The Federal Reserve wants jobs so consumers can go out and spend money, driving up the economic renewal. After all, consumer spending accounts for a whopping 70% of the country’s gross domestic product (GDP) growth. Now, imagine what it’s going to look like when Chinese consumers spend, which is exactly what the government is hoping for in that country. (Read “OECD Predicts China #1 Economy by 2016; Consumer Spending to Soar… Read More
Finally some good news in the U.S. jobs market?
The Bureau of Labor Statistics (BLS) reported Friday that, in November, 203,000 jobs were added to the U.S. jobs market. As a result, the unemployment rate went down to 7.0% from 7.3% in October. In addition to this, the BLS also revised the job numbers from October and September, saying 20,000 more jobs were created than previously reported. (Source: Bureau of Labor Statistics, December 6, 2013.)
Yes, the jobs market report for November is a step in the right direction. And, while I’m certain the politicians and the mainstream will have a field day with this news, the underlying statistics in the jobs market are not improving.
The underemployment rate, which includes people who have given up looking for work and those who have part-time jobs that want full-time jobs, still sits at 13.2%.
In addition, the number of long-term unemployed, those who are out of work for more than six months, made up 37.3% of all unemployed in November! There are 4.4 million long-term unemployed people in the U.S. and the longer they stay out of work, the harder it will be for them to get back into the market.
Finally, the majority of jobs created in the U.S. economy continue to be created in the low-wage-paying sectors.
The bottom line here is that the “official” unemployment numbers do not reflect what’s really going on in the jobs market. But the official rate is going in the right direction…and moving close to the point (6.5% unemployment) where the Federal Reserve said it would start pulling back on its money … Read More
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