Archive for August 2023

The speculation that increased issuance of Treasuries explains the recent increase in bond yields is unfounded, because since 1980 the correlation between changes in debt supply and Treasury yields is zero. The rise is more likely due to rising yields in Japan, tougher talk from the Fed, and increasing “no recession” sentiment.

On 7/31/23 there were a seasonally adjusted 8.8 million job openings, down from 9.2 million on 6/30/23, revised down from an initial 9.6 million suggesting rapid cooling, and 11.4 million Y-o-Y. This is the lowest level since 3/21, but still strong. Pre-Covid the number never exceeded 8 million. Quite rates also continued declining from a…

Including the Fed rate hiking cycle of 1968, there have been seven rate hiking cycles through 2008/09 that ended in a recession. Over the course of those cycles, it’s taken on average 22 months from the first hike to the start of the recession. The fastest recession onset was 12 months while the longest lag…

While job growth remains strong, the labor market is softening; as evidence, continuing claims for unemployment are steadily rising. At the beginning of the year, they were 300,000 below the weekly average of the years 2018, 2019, and 2022. They then steadily weakened such that by the end of 23Q1 they matched the three-year average…

The Friday File: the amount of capsaicin in Texas Pete is 750 Scoville units, Crystal is 800, and Tabasco Chipotle is 2,000. Huy Fong Sriracha comes in at 2,200, Tapatio is a warmer 3,000, Cholua is a bit hotter at 3,600, Tabasco is 3,750, and Marie Sharpe’s Fiery Hot Sauce is a refreshing 6,775. The…

Because the national minimum wage has not been raised in 14 years, it is becoming increasingly irrelevant. In 2010, 1.8 million workers were earning exactly $7.25/hour and another 2.5 million were earning less, like tipped staff. In 2022, just 141,000 were earning the minimum wage and another 882,000 were earning less. It’s a combination of…

While house prices declined from $410,200 in 6/23 to $406,700 in 7/23, don’t be fooled, that’s the highest July price ever and is up from $403,800 in 7/22. Similarly, while inventory ticked up from 1.08 months in 6/23 to 1.11 months in 7/23, it’s again the lowest July level ever and well below the 1.31…

During the Covid pandemic, Americans saved an additional $2.1 trillion above and beyond normal savings because of stimulus checks, an inability to travel and so on. Since August 2021, $1.9 trillion of that amount has been spent suggesting there remains just $200 billion. At a drawdown rate of $100 billion/month, the rate that has prevailed…

Chalk it up to more powerful computers, or more data, but weather forecasting has drastically improved. For example, a five-day weather forecast today is as good as a three-day one 25 years ago, a seven-day forecast now is as good as a three-day forecast in 1983, and the accuracy of a 10-day forecast today is…

The Friday File: The movie Barbie has generated over $1 billion in non-inflation adjusted global box office sales, making Barbillion the first solo female-directed movie to cross this milestone. But Captain Marvel (2019) co-directed by Anna Boden had $1.131 billion in sales, and Frozen (2013) and Frozen II (2019) both co-directed by Jennifer Lee had…