June 5, 2009


According to the latest Nonfarm Payrolls Report, 345,000 jobs were lost during May, and unemployment now stands at 9.4%. The consensus estimate called for 520,000 job losses and an unemployment of 9.2%.


wallstreetvet said...

GREAT. Means the $usd rallies back and commodities drop in the short term. Perfect setup to enter these trades after a pullback.

eric in vegas said...

Plenty of work out there if you're willing to work for minimum wage.

Anonymous said...

So less jobs lost, but the unemployment rate worse than expected, and you are calling for an end of the recession. Is this just so you can say you were the first one to call it? Really, what are you drinking?

When unemployment gets back to 6.5% and the GDP actually grows for a couple of quarters, then you can call it over. I just read our city's (population 100k) sales tax revenue is down 25% from a year ago. We still have a long ways to go.

casey said...

there never was a rtecession.Give me a break here.

Anonymous said...

i am doing what i was doing before.

Bukko_in_Australia said...

I'm sure those 354,000 people are SO feeakin' relieved. And the 9.4% of the population that's counted in the U-3 is too. No matter that the headline number was 8.9% last month, and the real U-6 number was even worse. Hooray, it's getting bad more slowly than it was before!

I know that before things start going up, first they have to pull out of the dive bit by bit, even while they're still diving. I just don't see any sound fundamentals for a sustained climb.

I still reckon it's like when I'm working a midnight shift and I drink a Styrofoam cup of crappy instant coffee at 5 a.m. to get me going through the 0600 med pass. My brain is still in zombie-land, but I can stagger around faster for an hour of so. I still feel shitty when it wears off, because caffeine is no substitute for sleep. Stimulus without real change is like powdered Nescafe, that's all.

Anonymous said...

the guys over at itulip are predicting 20% unemployment.

they have been spot on this whole time so we got more to go i think.

borkafatty aka the pig said...

not quite.


Stock up on bullets while they're still cheap.

hitfan said...

Keith is being sarcastic here, of course. After the 1929 crash, some people were gleaning all kinds of signs and good news from worsening data (only 500,000 jobs lost this month compared to last month's 700,000--we're headed to a recovery!).

All those people who lost their jobs will now be competing with other unemployed people for the very few jobs that will be created when the recovery starts, if it ever does.

Think how scary this is -- hundreds of billions in stimulus money and the jobs keep getting destroyed by the hundreds of thousands.

It would not surprise me to see the 'official' U3 unemployment rate hit 15%.

vanilla ice said...

That graph on MSNBC is telling. The rate of employment losses is declining. And that's an amazing decline, very unexpected.

I believe it is the money bomb like you said. The money bomb is buying this country employment. The cost of the money bomb is price inflation, over the course of the next couple years, the worst the USA has experienced.

Joe said...

I have got to believe that this Recession is over bit of yours is just a whole lot of sarcasm.

There was never any capitulation, much less despair. US Empire is dead meat on a stick and it will really start to get bad around July/August.

Early 2010 we get USD/USG collapse and 55% unemployment. Book that today.

Joe M.

fat amelican said...

Great recession is over. Great Depression II is in the batter's circle. I hear he's a heavy hitter...

Lost Cause said...

Stock market -- a leading indicator -- rallies due to employment -- a trailing indicator. I am getting whiplash.

I',m in a tropical depression said...

walmart is still hiring.Life is great man.Have you tools ever been to dollar tree.Place is full of shit from china.

Anonymous said...

So what was the Birth/Death Model number for May?

bobby lee johnson said...

"they have been spot on this whole time so we got more to go i think."

I think they (the government) had to pump money into the economy so the home buying season wasn't decimated. We'll see what happens after the summer wears off...

Guberville Smack said...

"Go back to what you were doing before."

Hey, not so fast. I am enjoying my taxpayer funded vacation, fully insured with no mortgage payment.
Isn't costing me a penny.
Yesterday I was down at the park shooting hoops with the neighborhood youngsters. Getting plenty of volleyball in and doing more hiking also.
And then there is S&A to read with my morning breakfast.

My cubicle will still be there in the fall.
Long Live the New America!

Dr. Huxtable said...

USD rally could be a major short squeeze. Or short term bounce. Either way I will take it.

Anonymous said...

GDP = consumption + gross investment + government spending + (exports − imports)


that's the only reason we will have positive growth.

it will be a shadow.

Anonymous said...

nope, it is a head fake. it will be worse by the end of the year.

CA just reported that its unemployment account is 17 billion in the hole. this is separate from the current 24 billion dollar budget deficit.

this bubble was just too big to turn around in 9 months. no way.

Anonymous said...

if its true that the worldwide investment banks printed up 500 trillion in derivitives (bogus non passable anymore ?) how does 2 trillion dollaRS PRINTED BY THE us TAXPAYERS SOLVE THE PROBLEM? IF THEN THERE IS NO PAYOUTS EVEN FOR HEDGED DERIVITIVES AS TO THEM BEING BAD BETS THAT WERE PASSED AS GOOD?.........

Anonymous said...

OK, I will continue to rent instead of buying an overpriced home.

I will also continue to save my money.

When everyone sells their gold and silver, I will buy it up. Same with guns and ammo.

i've had it said...

Ha, ha, ha, ha, ha, ha, ha, ha, ha, ha, ha, ha, ha, ha HA!

Shadow Stas show between 16% and 21% unemployment.

Under Clinton, the methodology for counting unemployment was changed in order to make his administration look good. What he did is he stopped counting people who were unemployed for so long that they just stopped looking for work; they are called discouraged workers. The BLS puts out a separate number for them, but it's not the number that's announced to the press every month; it's called U-3; for May, it was 16%.

Shadow Stats uses this number to create its own estimate, which for May is over 20%.

The BlS says 320k jobs were lost in May, but we need to see what the their birth-death model turned up. I bet it was a large positive number which brought it down to that number. ADP reported a few days ago 550k job losses based on their payroll business. And they only report data for the companies that do business with them. You can bet the number was a lot higher, probably in the 700k range.

The govt. puts out lies. All lies. Everything the govt. publishes is done to control your minds and sway your opinions. You are owned by the govt., the banks, and the media.

Time for Americans to break loose.

Randy said...

So, Orangezillo didn't really cause much damage after all?

The SEC will not have much of an argument if B of A and Country Wide prove to be doing just fine.

Why hang the Orange man when the phantom losses were all part of a normal business cycle.

k.w. - Southern Ca. said...

The "Great Recession" ended along time ago, and we are now entering the "Greatest of Depressions"

Here along the coast, I'm noticing more and more restaurants, stores and shops closing ... the massive losses in commercial real-estate are going to dwarf anything we've seen to this point.

A realtor, who was once prosperous in the neighborhood, has now has to resort to hitting the pavement herself trying to secure the few dwindling leads she has.

Tooo many people are asleep to this global disaster, but when they wake it, it will be the mother of all nightmares.

Randy said...

Rumor all over the US has it; that when Keefer saw the news that his declared nemesis Mozilo was being formally charged, He jumped so hard and high from excitement, that he hit his head on the low concrete ceiling of that Eurotard flat, came crashing down saw bright tangerine colored stars for a short while then faded into a full blown outta body experience.

Looking down at himself lying there with a huge silly grin, he could not remember what he was soo happy about.

His life history came flashing before him then came a vivid image of HP and a world full of FBers.

Feeling torn between going back to a world of FBers or go to monkey heaven, Al- Queefer decided to trust his smile.

He said to himself that the head bruised guy with the huge grin on his face is onto something, just to double check he looked up and knew the answer.

There it was; a gigantic 100 dollar bill greenback flag peacefully waving under calm blue skies.

When he opened his eyes he limped to the nearest puter and proudly typed in the following words.


Anonymous said...

It's OK, the Feds have plans for all those unemployed and even those of you who are employed!!

House Bill Proposes Commission to Explore National Servitude .

Isn't it great to be a slave in the home of the brave, land of the free?

Have you got it yet folks? Obama is a hardcore totalitarian fascist creep that wants to impose his will on you and your family to make a "stronger America" using his cult of feel good personality. Just like Stalin, just like Hitler, just like Mao, just like Kim Jong Il.

Why is it that the government always attracts the worst kind of sociopathic control freaks?


Anonymous said...

I'm really getting tired of the daily propaganda coming from our news here constantly telling us that we are at or near the bottom.
One of the most embarassing is the local "Philly Metro" paper here that SEPTA owns. They daily have about 3 articles telling people that now is the time to buy real estate, yesterday was the big condo sale buy now at $250K because they were priced at a 500K or more. Pity those that bought in at 500K. But do they really think a 1 bedroom hole in center city at $250K is going to bring out lines of potential buyers? Come on!
Housing prices are still going down. Employees are being laid off. Many are looking for early out on their government jobs. Over? NO.

Anonymous said...

Damn you are seriously delusional these days, Keith. Have you bothered to read Denninger's Market Ticker today?

He asks a probing question that maybe you can answer (being the Oracle that you are):

Now maybe you can tell me how we take an economy with 70% consumer spending, take 16.4% of consumers out of the spending force, add rising (rapidly!) long-term interest rates for mortgages (which will prohibit the banks clearing all that bad paper), shut down the PPIP and tell us all how with a GAAP P/E on the S&P north of the 1999 highs equity prices make sense..


Anonymous said...

Do you live in SillyCon Valley?

Doing anything this weekend?
Check THIS out:

See You There.

Frank Barney the Senate Butt-Man.

Anonymous said...

Rumor all over the US has it; that when Keefer saw the news that his declared nemesis Mozilo was being formally charged, He jumped so hard and high from excitement, that he hit his head on the low concrete ceiling of that Eurotard flat, came crashing down saw bright tangerine colored stars for a short while then faded into a full blown outta body experience..


That's the best thing I've read all week.


Anonymous said...

Ha, ha, ha, ha, ha, ha, ha, ha, ha, ha, ha, ha, ha, ha HA!

Shadow Stas show between 16% and 21% unemployment.

That's just a conspiracy theory and you are Al Qaeda.

I'm afraid we're going to have to put you in indefinite, preventative Obammy style detention.


Anonymous said...

sorry - no sale. move on.

buy silver.

Smug Bastard

Stu said...

U6 is the REAL unemployment level and it is and has been in double digits for quite sometime...

Keith, here are few issues in this report that jump out at you.

1. The sheer number of people unemployed.
2. The average hours worked per week at a record low.
3. Temp jobs typically tell us when an economy starts to turn and they are lousy right now.

This all tells me we have increased savings (A bad thing for economic recoveries), low demand, high inventories, jobs just not available, and a recovery that is not even close to occurring.

This report shows how bad things are getting and will surely increase once Chrysler and GM pair back their payrolls. Look for 500K again next month or the month following as a result of this.

As people from 2007 fall from the figures due to unemployment running out it doesn't make them go away. Have you seen the number of people on food stamps? How about vouchers? They are staggering to say the least.

We just went from bad to worse...

bottom feeder in philly said...

I don't give a shit about any reports out there. 2 out of 10 of my friends are out of work. Another 4 out of 10 are either grossly underemployed, suffering from hugely declining commision incomes(realtwhores, car dealers, medical sales) or have a business that is down 60% or so in sales.(My carlot sales went from 30 units a month to 10-15, We are having a going out of business liquidation.)I have also noticed our rental properties have great occupancy, but small families downgrading to 1 brm apartments, and extended families sharing houses. That tells me people are forced to downgrade their lifestyle.
I feel safe to say that 60% or better of the people I know have experinced a decrease in their income from 2008. Just saw a for lease sign on an antique shop that was in business for 25 years. It was in a very prominent main line suburb of Philly, and a good friend of my mother who is also in the antique business. My mom's sales are down 50% and she is considering retirement. If an economy based 70% on consumption has 20% real unemployment, and small businesses sales are down 30% or worse forcing them to further lay off employees(I laid off 2 sales kids at the car lot, and my maintainence guy for the rentals has been cut from 5 to 4 days)It seems to me we are caught in a downward spiral.
It really is bullshit that our government is flat out lying to it's people, at a time when it is imperitive to prepare for shit hitting the fan.
Keith, I don't know if your being sarcastic, or smoking way to much wacky tobacci, but when the high of the stimmulus wears off the US economy is going to get a REALLY BAD hangover.

Mad As H*** said...

I'm self employed. I am down to 10% of the business I did last year. I can't file for UE though.

My Father-In-Law is a part time truck driver and on Social Security. He hasn't had a run in 5 months. They finally told him he was terminated. He counted on that PT income to get by. He can't file UE.

My brother is a self employed carpenter. He hasn't had a job in 6 months he can't file for UE.

Believe me, it's way worse than 9.4%

Nimesh said...

So Keith, we just had the greatest asset bubble in the history of mankind and then it was all over in about 9 to 12 months right? I think you are too proud of a man to admit you were wrong. Thus now you will find any "glimmer of hope" possible and parade it on your blog.

Sad. Really sad that someone who used to be objective now can not admit to being wrong when it comes to supporting Obama.

keith said...

So many of you are refusing to acknowledge what Bernanke and Paulson/Geithner have done

We would have had a Greater Depression. But instead, they spent trillions, and we had a Great Recession instead.

And now we'll have a sugar high recovery.

When the facts on the ground change, you better change with them, and adjust. Or you'll get slaughtered.

Anonymous said...

When the facts on the ground change, you better change with them, and adjust. Or you'll get slaughtered..

Where is the recovery, Keith? Is it in housing? Is it in employment? Is it in manufacturing?

Oh where o where could my recovery be?

Just show us Keith and then we can put this petty debate to bed.


Anonymous said...

Is the recession over?

...a panel of experts on CNBC tackles the question.

Pure. Comedy. Gold.

i've had it said...

keith, you're wrong on this. get over it. it's ok to admit you're mistaken. really.

last night i was at a bar in manhattan with a buddy. we got to talking to another guy. turned out he works for a big commercial real estate broker in mid-town. basically, he said there's no market now. he said a contract just went through on a prime park avenue mid-town property for 50% of what they got a year ago. commercial rents going for half what they were on park ave is unbelievable! he said it'll be at least 18 months if not longer for things to stabilize. he was worried; was joking about going into the condom business because he figures there will be a lot of fucking around by all the people who aren't working.

as for the self-employed poster who is now unemployed, you're spot on. even the u-6 employment numbers don't capture any of the self-employed folks who are out of work..and there are millions of them. i think shadow stats' number does though, which is why it is around 20%.

JaneZ said...

Now maybe you can tell me how we take an economy with 70% consumer spending, take 16.4% of consumers out of the spending force, add rising (rapidly!) long-term interest rates for mortgages (which will prohibit the banks clearing all that bad paper), shut down the PPIP and tell us all how with a GAAP P/E on the S&P north of the 1999 highs equity prices make sense..



Just the facts. I love facts.

duarte said...

Do you mean people actually get high when you inject them with a trillion dollars of fiscal cocaine?

Let's just keep doing it, forever.

Anonymous said...



Do you know what happens when a hurricane passes over you?

First, it's almost obvious and many have the chance to run for cover.

Than, it's as calm as a day in heaven. Everyone is so relax, they quickly forget about the hurricane.

Finally, the eye of the hurricane passes, and slaughters suckers like you.

Don't come back later on preaching on how you started shorting the market X day, cause I will be the first one to look up this very post and slam it in your face. You are long the market and you expect hyperinflation. There, I said it. Keep waiting sucker.


Anonymous said...


Don't expect any response from Keith. He goes on these rants once in a while and we just have to eat it up. He did get the housing bubble right, as did many of us who were calling it back in 2002-2003.


Anonymous said...

Gonzo is right on, Keith.

This is a "bull trap" recovery, and since I know you like graphs, I am surprised you have not posted this one:


The material facts have not changed.


Duarte said...

Explain to me, Keith...how does the sugar high end the recession? You've heard of bear market rallies, haven't you? The others are right. Which industry are you discussing in particular. Housing?

Sub-Prime is gone forever, you know? Who is going to buy these houses?

They kicked the can down the road. Rising interest rates will eventually stall it again. Provide a bit of debt relief perhaps, but stall it again, nevertheless - because wages lag behind prices by a considerable margin. This is a long term recession/depression. Just like the Great Depression. You are calling the bottom of this thing about EIGHT years too early.

Anonymous said...

that was quick!

Anonymous said...


Over 520,000 jobs lost last month

16,000 a day since the stimulus package started

G M going, going, gone!


Unemployment at 9.4

Worst since early 80's

It's Over?

It ain't over til the Fat lady sings....

And Hillary doesn't sing she moans!!


Anonymous said...


How's that Hope and Change workin out for ya?


Anonymous said...

Is everybody here blind? Keith is right and we need to listen. All of us keep looking at this thing in terms of jobs growth and GDP. These things matter little to the stock market. What we are witnessing is the de-investment of America. The United States is having a fire sale and the Chinese are buying. No, there not buying everything; just what they need to become the world’s monopoly. You see, it doesn’t matter that the US is in decline and that the purchasing power of the US will never be the same again. We are no longer any competition to their economy; they are becoming the sole manufacture to the world.
It is true that the American consumer is hurting and that their standard of living is on a permanent decline. But they must consume a certain amount of goods in order to sustain themselves. China has the monopoly on this as well. A couple of examples: China processes 80% of all the Apple juice sold in the United States. They also produce virtually all the Vitamin supplements that are used in foods such as cereal and bread. These are just a couple of examples, there are many more.
When inflation arrives, and it will, we will have nothing to combat it. Unlike the inflationary period of the 1970’s, we will not be able to export our way out of it. So the cheap Chinese product you buy today will be a thing of the past. As the dollar continues its decline imports will become much more expensive which will further erode our standard of living. This would not be so bad if we had a manufacturing base that would allow us to export our products much cheaper as a result of inflation. But again, there is very little manufacturing left.
American companies are now investing heavily in China and China is investing heavily in them. The Chinese now have their sights squarely aimed at the tech companies. The Chinese are well aware that these companies in the United States are far superior to their own. They want these technologies and economic might it brings.
Here is an excerpt from a Washington Times article dated from Aug. 17, 2008:
Will China Really Supplant Us as the Next Superpower?
“For the innovative industries of tomorrow, Silicon Valley has fallen to the Far East. "China will become the IT center of the world and the only thing we can have a healthy discussion about is whether that's in 2020 or 2040," Cisco Systems CEO John Chambers said publicly in 2004. Cisco Systems is one of the premier bellwether companies of the technology industry. For a brief time in 2000, their market capitalization made them the richest and most powerful company in the world. When Chambers announced Cisco's plans to invest $32 million in a R&D center in Shanghai, China, the networking equipment and corporate technology behemoth made formal its offshore course of action. "What we're trying to do is outline an entire strategy of becoming a Chinese company," Chambers said. In the near future, will the rest of American industry follow suit?”
So you see Keith is right. The stock market will continue to rise until the dollar plummets. It will no longer be the world’s currency. But the value of the market will be in direct correlation with the value of the dollar. It doesn’t matter if it doubles; its value will be in terms of dollars.

Anonymous said...

You betcha. I am going right out to BUY BUY BUY a full year's supply of Ezekiel Mix for my family! Even the "Great Depression" starting in 1929 didn't go from depression stag/hyperinflation. Not in this country, at any rate; Germany was another story. I am also getting the gutters, the shingles, the whole house fan, and the trees overshadowing the vegetable garden taken care of, while I can still afford to do this. I'm also buying extra beds so as to convert my little library and sewing room into extra bedrooms should I need to house my extended family. Currently they still have jobs....

Miss Goldbug said...

Our receptionist gave her notice on June 1st and the position was posted on CL.

900 applications came in via the fax and email for the position in a little over one week. They are still pouring in - total cracked 1000 applications today.

This is for one full-time receptionst position paying $14-16 dollars an hour with benefits.

Also, I heard from a friend who lives in Tahoe said she knows someone who cant find a job there has to fly to the east coast to work for his brother to support his family in Tahoe.

this recession is far from over.

Mike Hunt said...

U6 is at 16.3% and climbing. U3 (quoted unemployment numbers) up to 9.4%. Remember the 'worst case' stress test on the banks assumed 10.3% unemployment by the end of 2010, looks like we will get there in the next 2 months!

The sugar rush helps but it's still plenty ugly out there.

Expect the stock market to leg down big time sometime this year.

Get ready to go short again and play the ETF's once more.

Good luck everyone.


Anonymous said...

Keith, I luv ya bro, been reading your blog(s) for it seems like three or four years now.

HOWEVER, I really do NOT agree with your "everybody back in the pool thesis."

Allow me to elaborate.

1) Banks around the world still have about $2.5T worth of loans that will go bad and have to be written off.

2) The housing market in the US is still getting worse, i.e. prices are still going down. Prices are likely to continue down because banks have really dragged their feet on the foreclosure front. That is, there's a huge wave of foreclosures that we'll see over then next four to five years. Google T2's May presentation to see all the graphs.

3) Federal, state, and local gov't are running HUGE deficits. Budget gaps are anywhere from 10% to 50% depending on location.

4) Treasury Dept. needs to issue about $2T of NEW Treasury bond paper this year to fund this year's deficit. ADDITIONALLY, Treasury needs to ROLL about $2T of T-bonds this year because they are maturing. So there's going to be about $4T in Treasury bond issuance this year. That is an amazingly HUGE HUGE HUGE amount of paper to be issued. It explains why yields are shooting up now despite the fact that we are in a DEFLATIONARY DEPRESSION. Anyone with half a clue is getting out of Treasuries because they know they have a first-mover advantage over the Chinois. Higher rates are going to force housing prices down even more. Higher rates will also make it hard for companies to fund new projects and borrow money like they'd do otherwise.

5) Earnings expectations are still way too high. Given 940 SPX level, current implied earnings are about 62 index points. That's not gonna happen. We'll be lucky to see 45 index points by year's end.

6) Consumers don't want to borrow. As such, we're seeing massive drops in the demand for consumer credit and a startling rise in the savings rate. Expect the savings rate to go from its low of -1% at the economy's peak to a high of something in the range of 12% to 15% at the nadir of this Depression. It'll happen mon ami. People do not want to borrow anymore like they used to. So if the consumer decides it wants to account for 66% of the US economy rather than the current level 74%, watch out.

7) This is not just a US Depression, this is GLOBAL. Our trading partners are going to try to devalue their currencies just as we try to devalue ours. Trade wars and protectionism are already starting. For more on how this Depression tracks the monstrosity that started in 1929:


There's probably a lot more that could be said, but I'll spare ya. Bottom line is that the consumer is pulling back HARD. Rail freight traffic is down 20% yoy thus far, as is air freight. Federal withholding tax $ is down 9% qoq, and state tax revs are prolly down even more (http://www.trivisonno.
com/withholding-taxes-chart). And of course the gov't is flinging dollars at the problem like a madman. But ANY HONEST ECONOMIST will tell you that the velocity of that 'stimulus' is ZERO. Obama hired Christina Romer to justify his bullshit claims about how many jobs the stimulus packages would create / save. Romer HAD BEEN a respected economist in acadamia. But now people who know her will chuckle and say that she's bending over backwards to provide rationale for something she herself does not even believe, i.e. that stimulus spending will work.


i've had it said...

So I checked the BLS site to see what the official tally for new jobs created via the false birth/death model they use. For the month of May, this model says that 220k jobs were created; and get this, 77k of those were in hospitality/leisure, and 7k were in finance!! Ha, ha, ha, ha, ha!

The sheeple really are stupid to allow the BLS to put out this BS.

So, with the official number of 345K net jobs lost in May, we have to add back the 220K jobs they pulled out of thin air and we get 565K jobs lost.

Next month when they get to revising their 345K number, it will go up at least another 35K. So, we will see that we lost at least 600k jobs in May.

Anonymous said...



What Recession?

Where was the pain?

Where were the cars, boats, planes, Rolex's, vacation homes, second homes.....
at pennies on the dollar

Saw None of it

Car dealer barely willing to deal

same with Realtors

People still spending like nothing has happened!

Big screens and High-end sunglasses, Iphones and MAC cosmetics

Las Vegas just as busy as ever...

some say, "well, they just don't spend as much when their there".

Well, then if things are that bad, you don't go at all!

Just wait it's commin!