Thursday, April 26, 2012

Retail Sales Employee Bubble (Musical Tribute)


Click to enlarge.

All it took was a bit of magic.

What would a reduction or elimination of silver content of our coins mean to you? The answer is that unless you're a coin collector or a hoarder, it would mean NOTHING. As for speculators, they should be fully aware that the Treasury is determined to hold silver's price where it is to prevent the melting down of existing coins for their silver content.

Oh Silvia Porter! What were you thinking!

CLIFF RICHARD - Devil Woman (1976)


I've had nothing but bad luck
Since the day I saw the cat at my door
So I came in to you sweet lady
Answering your mystical call

Crystal ball on the table
Showing the future the past
Same cat with them evil eyes
And I knew it was a spell she cast

Give me the ring on your finger
Let me see the lines on your hand
I can see me a tall dark stranger
Giving you what you hadn't planned

I drank the potion she offered me
I found myself on the floor
Then I looked in those big green eyes
And I wondered what I came there for

If you're out on a moonlit night
Be careful of the neighborhood strays
Or a lady with long black hair
Trying to win you with her feminine ways

Crystal ball on the table
Showing the future the past
Same cat with them evil eyes
You'd better get out of there fast

Source Data:
St. Louis Fed: Custom Chart
at

14 comments:

  1. Stagflationary MarkApril 26, 2012 at 9:10 PM

    As a side note, if we were to instantly drop to the blue median trend line then there would be an additional 5 million more unemployed.

    It wouldn't end there though. 5 million more unemployed would create more unemployment elsewhere no doubt.

    How's that for scary? Sigh.

    ReplyDelete
  2. Mr SlipperyApril 26, 2012 at 9:11 PM

    That is so funny. LBJ warned that the Treasury would use all the silver it had to suppress prices so people should not hoard it. He said silver would not rise in price.

    I am sitting on hundreds of pounds of copper and nickel to hear the same speech when they change the content of nickels to steel or eliminate them altogether. I also hope to hear how the Treasury will suppress the metal prices so don't bother hoarding them.

    Fire up the QE, Ben! Daddy needs some new shoes.

    ReplyDelete
  3. Stagflationary MarkApril 26, 2012 at 9:25 PM

    Mr Slippery,

    I really have to wonder about copper (and by extension many other metals).

    This is not exactly the 1970s. There are important differences.

    ReplyDelete
  4. Stagflationary MarkApril 26, 2012 at 9:27 PM

    I would even be so bold as to make a prediction.

    I think Peter Schiff's belief that there will be a market-crushing treasury collapse around 2013 is full of it.

    Time will tell.

    ReplyDelete
  5. Stagflationary MarkApril 26, 2012 at 9:28 PM

    Here's the link.

    ReplyDelete
  6. Stagflationary MarkApril 26, 2012 at 9:31 PM

    In any event, I thought you'd enjoy the bold prediction of Silvia Porter. I certainly got a good laugh out of it, lol. ;)

    ReplyDelete
  7. Stagflationary MarkApril 26, 2012 at 9:37 PM

    Here's another thought to back my "this is not exactly the 1970s" claim.

    Note that we're unwinding the 1960s and 1970s in this post's chart and I expect it to continue.

    In a world of ever expanding Amazon.com and/or Costco, I just don't think we'll really need more than 3% of the population to be employed as retail sales people.

    And if China thinks that they can put nearly 6% of their billion plus population to work doing it (like we once did), then good luck on that theory!

    ReplyDelete
  8. TroyApril 27, 2012 at 3:02 AM

    In 1970 the baby boom was finally being allowed to begin getting out of the Vietnam quagmire, and was aged 5 to 24. There were 80 million of them, so it took some time for all of them to get jobs, but eventually our economy expanded to handle them:

    http://research.stlouisfed.org/fred2/graph/?g=6LJ

    there were some dips in that graph, but adding in the Fed Funds rate:

    http://research.stlouisfed.org/fred2/graph/?g=6LL

    shows how these dips were endogenous with monetary policy -- ie. the PTB were causing them to slow hiring, debt take-on, wage growth -- and thus inflation.

    But now we stand in a different stream. In 2012 the baby boom is aged 48 to 66. They've pretty much bought everything they've needed to buy.

    http://research.stlouisfed.org/fred2/graph/?g=6LN

    compares payrolls (blue) to total working age population (green).

    We can see the baby boom echo start arriving in 1999, but with no new jobs. Maybe offshoring millions of manufacturing jobs wasn't such a good idea.

    http://research.stlouisfed.org/fred2/graph/?g=6LQ

    converts the above graph into Y-O-Y change.

    The green line shows the baby boom influx peaking in 1971 and subsiding in 1984 and their echo peaking in 2000.

    Job adds relative to population growth was brutal during the recessions, but at least the 20th century economy returned to net job growth over total population growth periodically.

    The housing bubble economy failed to repeat this pattern, as has the present post-recessionary period.

    ReplyDelete
  9. TroyApril 27, 2012 at 3:02 AM

    In 1970 the baby boom was finally being allowed to begin getting out of the Vietnam quagmire, and was aged 5 to 24. There were 80 million of them, so it took some time for all of them to get jobs, but eventually our economy expanded to handle them:

    http://research.stlouisfed.org/fred2/graph/?g=6LJ

    there were some dips in that graph, but adding in the Fed Funds rate:

    http://research.stlouisfed.org/fred2/graph/?g=6LL

    shows how these dips were endogenous with monetary policy -- ie. the PTB were causing them to slow hiring, debt take-on, wage growth -- and thus inflation.

    But now we stand in a different stream. In 2012 the baby boom is aged 48 to 66. They've pretty much bought everything they've needed to buy.

    http://research.stlouisfed.org/fred2/graph/?g=6LN

    compares payrolls (blue) to total working age population (green).

    We can see the baby boom echo start arriving in 1999, but with no new jobs. Maybe offshoring millions of manufacturing jobs wasn't such a good idea.

    http://research.stlouisfed.org/fred2/graph/?g=6LQ

    converts the above graph into Y-O-Y change.

    The green line shows the baby boom influx peaking in 1971 and subsiding in 1984 and their echo peaking in 2000.

    Job adds relative to population growth was brutal during the recessions, but at least the 20th century economy returned to net job growth over total population growth periodically.

    The housing bubble economy failed to repeat this pattern, as has the present post-recessionary period.

    ReplyDelete
  10. Stagflationary MarkApril 27, 2012 at 4:21 AM

    Troy,

    We can see the baby boom echo start arriving in 1999, but with no new jobs. Maybe offshoring millions of manufacturing jobs wasn't such a good idea.

    So much for the theory that our "service economy" could fill in the gap. It would seem that we will never have one person in ten employed as a retail salesperson. Go figure. In my opinion, even the era of one in twenty is over.

    I don't think many have priced in what a fall to one in thirty would do to our economy (the blue line in my chart).

    I suppose there is some hope though. Perhaps we can all make really fun games for each other. As a former game programmer, I'm only half-joking.

    ReplyDelete
  11. real asset investmentsApril 27, 2012 at 1:07 PM

    "Maybe offshoring millions of manufacturing jobs wasn't such a good idea." - The one hope for the US is natural gas. From what's out there from a variety of sources, as the price of nat gas becomes cheap enough, some major manufacturers are staring to "inshore" production. My favorite columnist Ambrose Evans-Pritchard of the Daily Telegraph (being a Brit I suppose I am a bit biased, but he really good) had an excellent piece a few months ago on the inshoring trend due to nat gas and wage increases in China. It tunrs out the UK is well endowed with plentiful shale gas as well. A ray of hope for the Anglo-Saxons?

    ReplyDelete
  12. Stagflationary MarkApril 27, 2012 at 1:52 PM

    real asset investments,

    I think there is more hope for us than the typical Chinese factory worker.

    For a variety of reasons, I have no desire to move to China. Let's just put it that way.

    ReplyDelete
  13. TroyApril 27, 2012 at 2:21 PM

    Perhaps we can all make really fun games for each other.

    from my web travels today:

    "JP Morgan Paid $4.1b for WAMU & Bear Stearns. Now $4b Buys Instagram & Angry Birds."

    ReplyDelete
  14. Stagflationary MarkApril 27, 2012 at 2:52 PM

    Troy,

    I need to lock in www.angrydogandponyshow.com before the next person gets it, lol.

    ReplyDelete