Author Topic: Unemployment Numbers-I'm Confused  (Read 1665 times)

AzCactus

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Unemployment Numbers-I'm Confused
« on: March 26, 2020, 09:10:44 AM »
Hi guys!  I'm not a macroeconomist by any stretch of the imagination but I like to think that I have a bit of common sense.  Unemployment numbers came out today and they were the worst on record if I'm not mistaken.  The markets are UP ~4-~5%.  I guess my question is, did I miss something super obvious here?  My statement would be that based on what we have seen over the past 3-4 weeks of trading for anyone who's a proponent of EMH---can you please explain what's going on.

Thanks,

David


rb

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Re: Unemployment Numbers-I'm Confused
« Reply #1 on: March 26, 2020, 09:32:26 AM »
Well, simply the number is good. There are roughly 152 million jobs non-farm jobs in the US. Out of that about 17 million are in leisure and hospitality. With maybe 30% of US economy offline and maybe 70% of leisure and hospitality offline a 3 million print is good, REALLY GOOD. But we also don't know. You could have a temporal issue and next week's number comes in at 6 or 7 million. Who knows.

As for EMH, I can't help you there buddy. If that thing were true we wouldn't have stock market crashes. Good luck with that one.

Uccmal

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Re: Unemployment Numbers-I'm Confused
« Reply #2 on: March 26, 2020, 09:47:32 AM »
At the moment stock markets are not a reliable indicator of anything.  They are caught in the hands of professional manipulators who trade continuously for a living. 

They simply are not reflecting reality which is that the main street economy is at least 50% closed.

I wouldn't worry, markets will figure out soon enough that governments can help people stay alive and fed but cannot prop up an entire moribund economy. 
GARP tending toward value

Broeb22

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Re: Unemployment Numbers-I'm Confused
« Reply #3 on: March 26, 2020, 09:54:15 AM »
The markets are forward-looking so today's number was already priced in to some extent. Apparently folks thought it would be worse. Maybe it will be.

gokou3

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Re: Unemployment Numbers-I'm Confused
« Reply #4 on: March 26, 2020, 09:56:38 AM »
I wonder if the unemployment numbers are 'small' due to some computer system overload which prevents people from even filing.  I know Canada has some issues with EI claims.  Btw, Canada has almost 1M claims, so US at 3M with 10x the population seems mild by comparison?

Gregmal

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Re: Unemployment Numbers-I'm Confused
« Reply #5 on: March 26, 2020, 09:59:56 AM »
Yea, the numbers may change and will short term get worse, but for Christs sake, shit just went down 40% in a couple weeks. Some things are definitely priced in.

rb

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Re: Unemployment Numbers-I'm Confused
« Reply #6 on: March 26, 2020, 10:05:55 AM »
We're actually 23% down. Not a lot priced in.

Spekulatius

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Re: Unemployment Numbers-I'm Confused
« Reply #7 on: March 26, 2020, 10:25:08 AM »
We're actually 23% down. Not a lot priced in.

I would agree. We are still up from the low late 2018 and the economy is much much worse. I am personally lightening up, but who knows what is happening next.
Life is too short for cheap beer and wine.

Gregmal

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Re: Unemployment Numbers-I'm Confused
« Reply #8 on: March 26, 2020, 10:30:49 AM »
In basically 4 weeks S&P basically went from 3400 to 2250. So itís a little odd people are so caught off guard by, a bounce.

chrispy

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Re: Unemployment Numbers-I'm Confused
« Reply #9 on: March 26, 2020, 10:33:40 AM »
I know a personal trainer who was receiving one more paycheck (2 weeks of pay) and then would file for unemployment.

I know a car salesman and the dealership can't determine if they will go limited time because people need cars or if the sales department is closed and everyone files for unemployment. Either way no one is selling their typical amount of cars.

I don't understand how the process works but it would seem that this is not picked up in any numbers yet. These folks are not spending more then required.
« Last Edit: March 26, 2020, 10:35:11 AM by chrispy »