Markets are flat this morning after a cluster of interesting macro economic news:
White Hot Singapore Douses the Flames
Singapore (EWS) has been en fuego. Now that every hedge fund and institution in the universe started piling in, the government has been forced to prevent debilitating inflation. On the flip side, as currencies strengthen in healthy economies, the US Dollar takes more Manny Pacquiao style beatings.
Initial Jobless Claims
The Department of Labor said Initial Jobless Claims increased 13,000 to 462,000 claims (versus 446,000 expected). Moreover, continuing claims dropped 112,000 to 4,399,000 claims.
Basically, Initial Jobless Claims are trading in a very tight range between 450,000 and 500,000. As we repeat like a viral retweet, the overall unemployment situation will not improve until Initial Jobless Claims fall below 400,000.
Notable Stat: Claims revisions over the past 24 weeks led to 23 weeks revised higher. This means a week later we’re told last week actually had more jobless claims than originally announced. Gotta love government stats.
Producer Price Index (PPI)
Core PPI was up only 0.1%, but when you add back necessities such as energy and food, PPI was up 0.4%. Despite what the Labor Department says about “core” PPI, energy and food are real costs. Inflation is finding pockets.
US Trade Deficit
Some addictions are more resilient than Edward the vampire in the Twilight Series. In August, the US trade deficit increased 8.8% to $46.3 billion. A lust for foreign vehicles and manufacturing equipment outpaced exports. Looks like we’ll continue shipping our wealth aboard for the foreseeable future.