Can the Jobs Picture be TOO Good?

We will dish up this morning’s Job numbers in a minute.

But before we do that, let’s ask a theoretical question, shall we?

Can the jobs picture be too good?

Here’s the problem in dehydrated form:

Too many job openings means everyone can find a job if they just get out and look for one. And, since Help Wanted signs have been appearing a lot of places, we have to assume there is likely just a bit of wage-driven inflation on the horizon.

That may sound fine, but it’s not: Prices of the good touched by the higher-priced hands will have their prices adjusted upwards, as well.

Next thing you know, the interest rates will be kicking up again and the Vicious Cycle will kick-in and we will be off on another massive 35-year work-up as inflation will bring us another economic peak around 2050.

That is, assuming the global war (2022-2024) on the backside of the Greatest Depression (starting late 2017) leaves any survivors.

To be sure, citing the “right” jobs number is hard. If you take simple payroll information, then perhaps the Labor Department numbers are credible. But the Alternative Measures of Labor Underutilization (Table U-6) is where Trumpedential candidates pull the 94-million un and under-employed from.

Problem is, each camp (as is so often the case) has a little bit of the Truth. Yes, there are lots of jobs, but if you want $30 and hour, benefits, vacation, and some personal/comp/and sick days, then well, maybe not so many. Pizza delivery ain’t pricing that kind of labor into the (sourdough, think-crust) mix.

Speaking of lower-end labor: Picked up the lead in VentureBeat yesterday about the world’s first “drone delivered” meals coming out of Just Eat.

When you think about it, you can almost see the military pincers-style crunch on the lower-income workers tightening up.

While there are (for now) lots of jobs, there is huge competition for jobs from the (should be but Obama doesn’t seem to follow the laws as passed by Congress so well) immigrants. And on the other side are the new-fangled machines.

I would tell you how this works out when we get to the “confidence collapse” that marks the Greatest Depression, but I need topics for columns-to-come in 2017 and 2018.

I know, not fair to tease, but here’s a future headline from out there a ways: Trumpvilles. These will be the modern analogs to Hoovervilles and will come from similar reasons, just different labels this time around.

Enough yammering…here’s the scandal-sheet just out…which you will notice improved as I suggested it would:

“The unemployment rate declined to 4.6 percent in November, and total nonfarm payroll employment increased by 178,000, the U.S. Bureau of Labor Statistics reported today.

Employment gains occurred in professional and business services and in health care.

Household Survey Data

In November, the unemployment rate decreased by 0.3 percentage point to 4.6 percent, and the number of unemployed persons declined by 387,000 to 7.4 million. Both measures had shown little movement, on net, from August 2015 through October 2016. (See table A-1.)

Among the major worker groups, the unemployment rate for adult men declined to 4.3 percent in November. The rates for adult women (4.2 percent), teenagers (15.2 percent),

Whites (4.2 percent), Blacks (8.1 percent), Asians (3.0 percent), and Hispanics (5.7 percent) showed little or no change over the month.

The number of job losers and persons who completed temporary jobs edged down by 194,000 to 3.6 million in November. The number of long-term unemployed (those jobless for 27 weeks or more) was little changed at 1.9 million and accounted for 24.8 percent of the unemployed. Over the past 12 months, the number of long-term unemployed was down by 198,000.

About that U-6 Alternative Measures data?

“Unemployment in U-6 dropped to 9.3% from 9.5% in October, the previous month.”

And then what about the much touted Labor Participation Rate?

“The Labor Participation rate dropped to 62.7% from 62.8% in October.”

And last, we have the made-up, inferred, or what I think of as the Pokémon-birthed jobs that are “estimated” into existence via the CES Birth-Death Model?

“Only 2,000 jobs were created in November by the CES Birth-Death Model.”

This will be a difficult day for markets. That’s because on the one hand, you want people to have jobs. But you don’t want so many jobs that people start fighting (or inventing) for them.

And this matter of human labor displacement will be covered in this weekend’s Peoplenomics report which is simply titled “Robots Don’t Pay Income Tax.”

You’ll like it, or not. Depending mainly on what your view of depreciation is. The history of special tax treatment for the rich is seriously embedded in American starting with the conquest of the West by the railroads and in a curious way, depreciation of assets made the American genocide (that we don’t talk about in polite society) not just possible but inevitable.

History is about to replay on a different level. Except for the part where it’s not smallpox. It’s the human replacements and drones that make us all obsolete.

And yes, that’s the kind of socioeconomic shift that ends great civilizations based on delusional ideas about storing “wealth” in “paper” and “electrons.”

Futures are about flat while the herd tries to figure out what this jobs report means.

Speak of Electronic Tulips

One Bitcoin will fetch $768 FedNotes today.

We now return to the alt-real.

No Rest for the Trumped

We see that the paper that (if memory serves) lined up with the Clintonistas and said Donald Trump wasn’t fit is still sowing discontent.

This as it headlines “ For the Record: The next Defense secretary called war ‘a hell of a hoot’” in their online editions.

Perhaps more evenly others report CLOSEST THING TO PATTON’ Trump says retired Marine Gen. Mattis is his secretary of defense pick.

Grapes of the sour variety is it, we’re hearing?

Seems to me that USA Today may have attended the Jill Stein School of Statistics.

You know the one: Where graduates become delusional and self-important while failing to grasp the larger context of the math or social events.

In the Stein case, she can recount till the Second Coming and she still won’t win. And USA Today looks to pick up the politicized liberal millennial.

I suppose this is how “free markets as supposed to work” but it would be nice if at least the numbers would work-out so as to coat obvious politics with a thin patina of reasonableness.

That way, both surviving democrats on the Hill won’t sound completely idiotic. I know – that’s asking too much, I s’pose.

Hmmm… if you can’t say something nice, you still have a paper to fill…got it.

Our SecDef Pick Would Have Been?

Retired Marine Lt. General Paul K. Van Riper. Few remember how in Millennium Challenge 2002 he kicked everyone’s butt. But Wiki it:

“Van Riper gained notoriety after the Millennium Challenge 2002 wargame. He played the Red Team opposing force commander, and easily sank a whole carrier battle group in the simulation with an inferior Middle-Eastern “red” team in the first two days.

To do this, Van Riper adopted an asymmetric strategy. In particular, he used old methods to evade his opponent’s sophisticated electronic surveillance network. Van Riper used motorcycle messengers to transmit orders to front-line troops and World War II light signals to launch airplanes without radio communications. Van Riper used a fleet of small boats to determine the position of the opponent’s fleet by the second day of the exercise. In a preemptive strike, he launched a massive salvo of cruise missiles that overwhelmed the Blue forces’ electronic sensors and destroyed sixteen warships. This included one aircraft carrier, ten cruisers and five of six amphibious ships. An equivalent success in a real conflict would have resulted in the deaths of over 20,000 service personnel. Soon after the cruise missile offensive, another significant portion of the opposing navy was “sunk” by an armada of small Red boats, which carried out both conventional and suicide attacks that capitalized on Blue’s inability to detect them as well as expected.

After the simulation was restarted with different parameters, he claimed that the wargame had been fixed to falsely validate the current doctrine of the U.S. Navy.[1] He is also critical of post-war Iraq plans and implementation. On April 24, 2006, he joined several other retired generals in calling for Rumsfeld’s resignation.”

Oh, and a further footnote: So far he has been exactly right on how President Useless has botched Iraq and fertilized ISIS. Not to mention the Iran payoff which seems safely under the rug…

Point is, Van Riper should be leading the backroom tacticians if we’re going to stop being a foreign policy joke.

After we fire the losers-nest of neocons at State who have been serial-fumblers at “regime change” that is.

Just a thought.

The Lost Democrats

Although it has been popular (by the Clintonistas) to claim the republican middle was imploding, we see just the opposite happening as the Democratic National Committee is looking for a new chair.

Representative Keith Ellison might have been a logical pick at one point, but now come the questions about past ties to the Nation of Islam and his defense of some anti-Semitic figures.

All of which leads to the conclusion that the democrats are on the rope, including the “legacy” of the he who is nearly gone.

Climate Change Marketing Equals Money

We’ve had nothing but respect for the climate-jackers. People like Al Gore, and that Illinois state senator Barrack something who helped assure the money to start the carbon exchange.

It has all been a miracle of “issue monetization.”

We are not alone in our recognition, now. The “world’s cities” are trying to scam up $375-billion to “fight climate change.”

While it sound worrisome, we notice that temps are actually coming down around the world and no, sea level has not flooded Wall St. yet.

What’s worse for the worried politicians is that while Obama has been “treating the Paris Accord” on climate as though it was law, it is in fact NOT.

An inconvenience that Forbes has a good summary on over here.

For the record, I am NOT climate denier. Earth has had climate change for millions of years. But until just recently, our predecessor upright apes hadn’t figured a way to monetize it.

Yes, the same light-punching apes who have invented the mobile phone now believe money can change weather, if you have enough of it.

We’re waiting for the next damn fool to monetize another absurdity. In the meantime, wanna buy some pollution credits?

Don’t call me skeptical.  Call me George.

Oil:  Up in Smoke

As “Iraqis battle the blazing oil wells suffocating residents.”

Wait…does this mean Iraq should be trounced for Global Warming?  I mean smoke, suspended particulates…where’s the Obama climate army on this one, huh?

Coffee Break

Starbucks shares fall as CEO Schultz steps down.

A reasonable View?

Columbia U Prof: Stop Calling All White People Who Disagree With You ‘White Supremacists’.

Comments

Can the Jobs Picture be TOO Good? — 17 Comments

  1. ” Can the jobs picture be too good? ”

    The way I see it.. that is a good sign.. around here I visited with a guy that said he moved here because the job numbers were so good.. then he said.. they are.. but no one said I would need four of them to make enough income to survive..

    when a diabetic bottoms out you try to get sugar in him as fast as possible before he crashes and goes into a diabetic coma.. so orange juice etc. is given as fast as possible. this spikes their sugar up..once sugar is given if you don’t feed them they will bottom out really fast..the spike is a false positive ..
    Considering that The federal reserve bank is a diabetic and With all the countries whose monetary system is associated with the dollar and the federal reserve are failing could this be that we are seeing a false positive from them pushing the sugar into the dollar since the dollar is the only strong currency left of the federal reserve bank..? if something isn’t done about jobs and industry ( feed the country ) will this currency bottom out quickly sending us into the death spin.. ( my bet is march through august of the coming year)
    What will happen if the Federal reserve fails?

  2. George really. Next economic bust 2050. Get real, we won’t be here. Let’s just see who survives the next couple of years. You can only dream. The zen master

  3. The main issue I have with long term predictions is we are out of or nearly out of critical resources. When you see a big copper mine that in a mile deep and they are processing tons of soil to get grams of gain and that is across the board, not just peak oil but peak everything. 45 years, Not a chance. You can’t make a solar panel using the energy of a solar panel same with wind power.Before, fossil fuels we had to get growth by raiding or discovering other places much to the detriment of the people living there. We have discovered everything and raided everything now we are trying to justify all the planters we have made called tanks and planes and SUV’s and subdurbs.

    • You can’t make a solar panel using the energy of a solar panel

      Based on what data are you making this claim? Over on The Oil Drum these kinds of claims were made and shown to be bunk on a regular basis. So why should you be believed as correct – because Mr. Ure accepted your post? EROEI (energy returned on energy invested) numbers show PV and wind have positive returns. http://festkoerper-kernphysik.de/Weissbach_EROI_preprint.pdf

  4. They already have “Obamavilles” in Seattle. Will they be changing the name to Trumpville?

  5. George,

    USMC (retired) General James “Mad Dog” Mattis is a no-nonsense, non-partisan (he’s registered as an Independent) leader who knows how to give and follow orders. He has a strategic mind but holds a humanitarian perspective. Mattis was so totally devoted to his military life and academic studies that he never married or had children, earning the nickname “warrior monk.” Mattis possesses a very personal and direct method of communication. When questioned by Trump about his views on waterboarding, Mattis answered he “could coax more information from a detainee with a pack of cigarettes and a couple of beers.” In Iraq and Afghanistan, he comfortably assumed the role of warrior/statesman, bringing in tribal leaders to educate his marines on cultural and religious sensitivities so as not to belie the trust of the locals. He is decidedly anti-Iran in almost every political and military way, yet Mattis advocates a two-state solution in the Middle East between Israel and the Palestinians. The story goes that the current lame duck Commander-in-chief decided to force the Marine Corps legend out early because his direct method of verbal engagement rubbed some ultra-sensitive, progressive civilian administration officials the wrong way. That very quality will serve him well as Trump’s SECDEF. The men and women in uniform know that he’ll understand them, their difficult missions and their personal needs, fairly representing them to the president, congress and the nation. On January 20, 2017, “Chaos” (Mattis’ call sign) will return to the Pentagon.’ A bent but not broken U.S. military will once again be in very capable hands.

    • When I first heard of the appointment I was against it. However, over the past couple of says I have heard nothing but praise for the man from everyone. I’ve heard many liberals and journalists also praise him. People who I thought would be reflexively opposed to him also only have good things to say about him.

      I’m convinced that he’s a good pick to help guide the shaky ‘small’ hands of Trump.

    • Thank you, Warhammer. I have no basis for an informed opinion, but I assent that you do. Whether or not there’s an actual basis for feeling so, I am somehow strangely reassured by your thoughts on the matter. Only time will tell.

  6. “we notice that temps are actually coming down around the world and no, sea level has not flooded Wall St. yet.” And that would be a bad thing? Other that it not being a tsunami that would wash all of the crooks away.

  7. You are so obviously prejudiced against the ‘progressive (ugh) left’ and so hooked on loving Trump and the crazy conservative ‘red-necks’ that your column has little more value than most of the other ‘believe like me’ slanted web sites. In a short while you will see why Trump was installed by the PTB and will become the most horrible president (and maybe the last) for our overcrowded country and world. Enjoy the coming horrors — remember “YOU asked for it!!”

  8. Why don’t you ever write about the people who make a boatload of money personally by being professional “merchants of doubt” — feeding the deniers?

    Some of the very same people were paid millions by the tobacco industry to push “scientific skepticism” about the link between cancer and tobacco. They kept up their mid-six-figure personal incomes a full 30 years after the Surgeon General report in the 60s.

    While we’re looking for some honest accounting, how much money is spent and made as profit by the suppliers who build and maintain the four or five superfluous carrier groups that exist only because we provide free armed guard services to the flow of Mideast oil?

  9. The problem with the jobs picture is that people look at the government statistics and then act and talk like they really mean something.

    The only jobs that have any significance for the country are manufacturing jobs. All the rest are just smoke and mirrors like the 300-1 paper to metal in the COMEX. Service jobs are the equivalent of you pay me to clean your house, and you clean mine and we will call that employment. Only by printing money can an economy that has 70% service employment survive.

    Last stat I saw showed fewer than 8 million manufacturing jobs. Of course that probably doesn’t include prison labor, which produces the only USA products competitive in the world market.

    This is how it works America. Tim Cook said when they brought the iPad to market, they needed a new manufacturing facility, and 3,000 engineers. Foxcon pulled this off in 90 days, eventually employing 100,000 people. Cook said this would have been impossible in the USA, it would have taken 2 years just to assemble that many engineers, if they could find them at all, and the cost of moving them alone would have exceeded the entire cost of the Foxcon facility. And then there would have been the 3x cost of labor annually.

    Apple manufactures their high end desktops in Austin Texas, the factory startup was 18 months behind schedule. The price of the computers is $2,500 to $27,000, and adds literally nothing to apple’s bottom line.

    Apple pays about $20 for a CPU for an iPhone. Intel’s manufacturing FIXED costs per CPU for USA manufacturing is $25 or more. Why is this relevant? Overhead costs for a full time USA employee in a good job like manufacturing is between $10-15,000. Average wage of a chinese worker is $9,000, and that is considered a good wage.

    • Yes, our manufacturing has been destroyed, our engineers not hired or laid off, and our country purposely weakened to get your bragging roll down of how far we have fallen. That is why Trump was voted in. Obama spent 8 years tap dancing to the globalists’ agenda, and YOU think that is an indictment on US, THE UNITED STATES CITIZENS and this country that you have so gleefully watched be torn down. Well, stand back and get out of our way as we are on the march. We are casting off the criminal elite chains that have bound us.

  10. Good morning George,
    The brazen acts of the carbon tax / credit implementers exposed flaws in the climate change business model; it is a bit difficult to build a business around acts of nature when the only an increase in sea level or temperature wins, thus forcing data manipulation and media campaigns.
    But, how about other current hot topics like immigration, business emigration or even war fighting? If El Salvador wants to export refugees to the US, they could ‘earn’ ($$$$) citizen emigration credits (CEC) with the host country and the arriving immigrants must possess Citizen Intake Credits (CIC) ($$).
    Businesses desiring to leave the US for cheaper labor have to earn ($$$$$$) ‘Business Departure Credits’ (BDC). Receiving nations like Mexico pay stiff business ‘capture’ credits (BCC). Think of all the new agencies, acronyms and employment we could create while formalizing the fleecing of business, citizens and governments. And, the model works in either direction unlike global warming. The possibilities are endless.
    Everything’s a business model………

  11. I think Jill Stein is just trying to tie up 3 states’ electoral votes until after the Dec 19 Electoral College voting- so the race will go into the (Senate)? and Hillary will be our next president.

    • All states must have certified votes by December 13. The electors vote on the 19. Trumps still in. Don’t worry.

  12. George,

    Re climate change, you have to be a brave man to say anything against it these days but..

    I clearly remember back in the 70’s as a teenager in school being taught that, based on temperatures having dropped for around 20 years, a new ice age was on its way.

    Of course that never happened and we are only talking 40 years ago.

    Keep up the good work.

    Paul.