- Germany's East Is Shrinking
According to forecasts from the 'Institut der deutschen Wirtschaft Köln', Germany's population is going to increase to 83.1 million by 2035.
As Statista's Martin Armstrong notes, the main reason for this is the record number of immigrants and asylum seekers which arrived in the country in 2015.
You will find more statistics at Statista
While the overall trend is upward, seven of the country's sixteen federal states will see net decreases – primarily in the former German Democratic Republic (aka East Germany).
The largest decrease is expected in the state of Saxony-Anhalt, where a 10.6 percent fall is forecast.
- 'Decoders' Offer Dire Warnings About North Korea's Nuclear Program
Authored by Mac Slavo via SHTFplan.com,
Experts outside the United States government are using North Korea’s propaganda videos to dissect and decode the rogue regime’s nuclear program.
Decoders say that there are clues about the weapons advancement program hidden in their propaganda, and they are sounding the alarm.
A group of analysts at the Middlebury Institute’s Center for Nonproliferation Studies in Monterey, California are closely studying the propaganda photos and videos put out by the North Korean regime. They then apply new tools such as satellite imagery and 3-D mapping to the videos and photos so they can learn more about how the North continues to advance their weapons in the face of sanctions and growing opposition.
The analysts are finding amazingly : information about North Korea’s military capabilities and in this , they walk us through the clues that reveal the capabilities of a North Korean missile. They will also show instances where they’ve found the North Koreans to be faking their weapons success.
The intense voices in North Korea’s videos make them seem legitimate, but the decoders have looked into what they can actually accomplish and what they cannot by simple decoding images used by the regime themselves.
Perhaps the most alarming revelation is that the decoders suggest that it’s likely that North Korea is using highly advanced machines to construct their missile components. This could make getting a powerful nuke more likely than originally thought. They also say that North Korea has a missile that can carry a warhead capable of hitting the mainland United States, “New York, LA.”
But they also point out the failures in the North Korean weapons advancement program and can identify where Kim Jong-Un is in several photos.
- These Are The World's Most Congested Cities
No matter what city you live in, traffic is something you probably dread being stuck in.
Whether it is the slow-moving I-95 in New York City or the molasses-like trip from East Hollywood to Santa Monica in L.A., it’s estimated that traffic congestion costs the United States alone a whopping sum of $300 billion per year in gas and time.
THE WORLD’S WORST TRAFFIC
Which city has the ultimate distinction of having the world’s most horrific traffic?
Today’s infographic comes to us from INRIX via their Global Traffic Scorecard 2016, and it highlights the most congested cities around the globe. The report looks at average hours spent in congestion for 1,064 cities in 38 countries, as well as the percent of time spent in traffic.
Courtesy of: Visual CapitalistHere’s a Top 10 list you don’t want to see your city on:
Taking the top spot was Los Angeles, where drivers spent an average 104 hours stuck in the city’s legendary traffic jams.
The cost of this congestion, measured in wasted time and fuel, was $9.7 billion – a number that works out to $2,408 per driver!
- Paul Craig Roberts Asks "Was The Las Vegas Shooting A False Flag?"
Authored by Paul Craig Roberts,
Dear Readers, I appreciate the confidence that you show in me with your emails asking my opinion about the Las Vegas shooting. Many of you suspect that it is another false flag affair, and you ask me about its purpose.
I don’t know if it was a false flag attack, and if so, by who or for what purpose. I don’t expect to ever know. A story is set in place by officials and media. The only way to ever know is to personally investigate. You would have to go to Las Vegas, examine the scene, ask questions of the hotel, investigate the answers if you get any, find and interview concert attendees who were shot, attend funerals and see bodies of those killed, speak to their families, learn about the weapon allegedly used, experience trying to shoot at targets far below and far away, compare the number of casualties with the recorded time of firing, and so forth. In other words, we would have to do the job that in former times would have been done by the press, but no more.
It is almost like the story is being kept from us.
For example, from media reports that the event was just across the street from the hotel, I did not know that “across the street” was a distance of 390 yards (1,170 feet).
As I don’t expect to ever have a confident opinion about what happened, I am not paying much attention to the mass shooting, or should I say alleged shooting. We are lied to and deceived so much that we can never tell when we are told the truth. It is like Dmitry Orlov says:
“Lies beget other lies, and pretty soon unbiased intelligence-gathering, rational analysis and proper mission planning become impossible.”
” … a reputation for telling the truth can only be lost exactly once, and from then on the use of the phrase “US intelligence sources” became synonymous with “a conspiracy of barefaced liars.””
“Whatever message Washington and Western mass media are trying to push, a perfectly valid response is to point out all the times they have lied in the past, and to pose a simple question: When did they stop lying?”
Official explanations of such events as Las Vegas, Sandy Hook, and so forth, always throw up red flags, because the official explanations always studiously ignore contrary eyewitness and other evidence. Also, often there are not even smart phone videos of dead and wounded people. As far as I can tell, the bodies of 573 dead and wounded are absent in the Las Vegas video evidence. Considering the suspicion that such events cause, one would think the authorities would make a special effort to show the dead and wounded. In other cases of mayhem, alleged bodies look like dummies or are covered and could be a pile of anything. The presence of crisis actors on the scene, as in the Boston Marathon Bombing, raise more questions. I remember when it was expected that police and media would investigate all evidence and clear away contradictions. Now all we get is an official story instantly ready and repeated endlessly by officials and media. This itself raises suspicions.
You will have to make up your own minds about Las Vegas.
Here are some of the reported facts to consider:
The victims killed and wounded total 573. That number is the size of a military battalion. It is very difficult to turn an entire battalion into casualties with small arms fire even in a fierce combat situation. I don’t know if it has ever happened. Can one person with no military training shooting down from 32 stories, which requires special sighting knowledge, at a distance of 390 yards – the length of 4 football fields – hit 573 people in a few minutes of firing?
Jon Rappoport doesn’t believe it.
Neither does the progressive Steve Lendman.
There are reports of multiple shooters.
There are reports of gun flashes from the 4th floor.
The windows on the hotel do not open and would require the glass to be broken.
Stephen Paddock doesn’t fit the profile of a psychopath. Reports are he was a multimillionaire with airplanes and his own pilot. He enjoyed life. His brother is dumbfounded, said it makes no sense Stephen did the shooting.
The Mandalay Bay Hotel is reportedly a casino. If so, security cameras are everywhere. Why no videos of Stephen Paddock carrying in the many cases of 23 firearms and ammunition? How could maid service clean the room for three days and not see 23 firearms and their ammunition? Makes no sense.
Why 23 guns? The number is beyond superfluous.
The large number almost suggests that the entire event is concocted as a gun control incident. The huge number of guns, the huge number of casualties. Finally, at last, enough “gun violence” to get gun control.
Skeptics are waiting to hear from the authorities how a person at such a distance managed to shoot so many people in such a short time and with what automatic rifle and caliber the deed was done. As this part of the story is especially difficult to believe, we will probably not get the explanation.
And it is not only the authorities and the presstitutes that truth is up against. There is also the lack of integrity in people with axes to grind. For example, Paul Street writing in CounterPunch says: “The Las Vegas massacre is just the latest in the Gun Lobby’s long line of terrorist attacks on U.S. soil.” The article is titled: “The NRA’s Latest Terrorist Attack on U.S. Soil.”
The gun control lobby has a massive vested interest in the official story. You can bet your life that the gun control lobby will ignore any and all problems associated with the official story. The story is exactly what they want in order to advance their cause. The campaign is underway.
As Paddock is a rich white male, the story also fits with Identity Politics. Paddock is another example of the evil white male. Here is the Identity Politics connection served up by the Washington Post:
“All across America white men, some young, some of middle-age, are turning into wolves. Always, after they commit acts of terror, it is revealed out that these perpetrators were not men after all. They were beasts, mindless monsters whose evil was abstract and cold and terrible.”
CNN says mass shootings are “a white man’s problem.” See “How America has silently accepted the Rage of White Men:”
People are more interested in confirming their beliefs and prejudices than they are in the truth. If Paddock were a Muslim, Islamophobic people would cling to the official account.
Truth requires that people believe in truth more than they believe in their own biases and causes. In the United States, such people are increasingly rare.
Remember always the Roman question: “Who benefits?” That is where you will find the answer.
* * *
UPDATE: Paddock’s girlfriend describes him as a “kind, caring, quiet” man who she envisioned a “quiet future” with. A woman knows a man. Her description is not one of a psychopath.
I have spoken to more experienced persons and experts including US Marine snipers. They don’t believe a word of the official story. Will, once again, the experts be got rid of by branding them “conspiracy theorists” as was done to 3,000 architects and engineers who challenge the official story of 9/11?
- Proof of Multiple Shooters at Vegas Attack?
I haven’t explored this story — because I’e been uninterested in theories. However, this video is compelling, kindly narrated by A. Jones.
Sounds like two distinctly different calibers and distance from attack.
Thoughts?
- "He's Full Of Crap": GM Exec Slams Musk As Car War Breaks Out
Elon Musk says the upcoming Tesla Model 3 has the hardware to enable full-self driving capability. But GM’s self-driving car czar thinks he’s full of crap.
GM's director of autonomous vehicle integration Scott Miller told a group of Australian journalists in Detroit on Thursday that Musk was “full of crap”, explaining that a “level 5” – that is, fully autonomous – vehicle would require hundreds of thousands of dollars’ worth of sensors. Even for a company like Tesla, which investors have practically encouraged to burn through large sums of cash, offering such an advanced vehicle for between $30,000 and $50,000 would be an impossibility.
"I think he's full of crap," Mr Miller said. "To think you can see everything you need for a level five autonomous car [full self-driving] with cameras and radar, I don't know how you do that."
Tesla and a handful of other car companies are testing autopilot in Australia, according to the Leader.
The company is planning to price the Model 3, which just started rolling off the production line at Tesla’s California factory, at $50,000 in Australia. The car reportedly incorporates cameras, radar and ultrasonic sensors for self-driving.
However, as the Leader points out, the Model 3 won’t be able to use Tesla’s controversial autopilot feature until the company’s engineers perfect the software. A Tesla driver in Florida became the first person to die in an accident involving Autopilot. Eventually, the NHTSA ruled that Tesla wasn’t at fault in the crash. But since then, other customers have complained that they found the way in which autopilot was marketed to be misleading.
With this in mind, perhaps Musk should consider the consequences before exaggerating the functionality of a feature like autopilot.
- JPMorgan Updates By-laws In Case Of "Nuclear Disaster" Or World War III
In the most bizarre news of the day, Bloomberg’s Hugh Son noticed that in a late Thursday filing, the board of JPMorgan approved a series of revisions to the bank’s by-laws, including a particularly notable one: a new section defining what constitutes a quorum in an emergency resulting from “an attack on the United States” or a “nuclear or atomic disaster.” That scenario is listed among emergencies that – understandably – might make it hard to hold a normal meeting for board members of America’s largest bank.
The clause can be activated not just in case of a nuclear disaster or World War III, but also in a variety of situations including “without limitation apparent terrorist activity or the imminent threat of such activity, chemical and biological attacks, natural disasters, or other hazards or causes commonly known as acts of God.”
In short, JPMorgan’s Board has decided it is time to seriously consider a TEOTWAWKI scenario.
As Son notes, in such an event, any member of the board or the firm’s operating committee can call a meeting using “any available means of communication.” And, just in case everyone else on the Board happens to die, one person will be sufficient to constitute a quorum. Vacancies can be filled by a majority vote of available directors. And if none are around, then designated officers can stand in. No officer, director or employee can be held liable in such a situation, except for “willful misconduct.”
The revised Emergency By-Laws are reposted below (highlights ours):
ARTICLE XI
Emergency By-laws
Section 11.01. Emergency By-laws. This Article XI shall be operative during any emergency resulting from an attack on the United States or on a locality in which the Corporation conducts its business or customarily holds meetings of its Board or its stockholders, or during any nuclear or atomic disaster, or during the existence of any catastrophe or other similar emergency condition (including without limitation apparent terrorist activity or the imminent threat of such activity, chemical and biological attacks, natural disasters, or other hazards or causes commonly known as acts of God), as a result of which a quorum of the Board or the Executive Committee thereof cannot readily be convened for action (an “Emergency”), notwithstanding any different or conflicting provisions in the preceding Articles of these By-laws, the Certificate of Incorporation or the General Corporation Law. To the extent not inconsistent with the provisions of this Article XI, the By-laws provided in the other Articles of these By-laws and the provisions of the Certificate of Incorporation shall remain in effect during such Emergency and upon termination of such Emergency, the provisions of this Article XI shall cease to be operative.
Section 11.02. Meetings. During any Emergency, a meeting of the Board, or any committee thereof, may be called by the Chairman or any other member of the Board or the Chief Executive Officer, or any member of the Corporation’s Operating Committee (each, a “Designated Officer” and collectively, the “Designated Officers”), or the Secretary. Notice of the time and place of any meeting of the Board or any committee thereof during an Emergency shall be given by any available means of communication by the individual calling the meeting to such of the directors and/or Designated Officers who shall be deemed to be directors of the Corporation for purposes of obtaining a quorum during an Emergency if a quorum of directors cannot otherwise be obtained during such Emergency, in each case, as it may be feasible to reach. Such notice shall be given at such time in advance of the meeting as, in the judgment of the individual calling the meeting, circumstances permit.
Section 11.03. Quorum. At any meeting of the Board, or any committee thereof, called in accordance with Section 11.02 above, the presence of one director shall constitute a quorum for the transaction of business. Vacancies on the Board, or any committee thereof, may be filled by a majority vote of the directors in attendance at the meeting. In the event that no directors are able to attend the meeting of the Board, then the Designated Officers in attendance shall serve as directors for the meeting, without any additional quorum requirement and will have full powers to act as directors of the Corporation for such meeting.
Section 11.04. Amendments. At any meeting called in accordance with Section 11.02 above, the Board or a committee of the Board, as the case may be, may modify, amend or add to the provisions of this Article XI so as to make any provision that may be practical or necessary for the circumstances of the Emergency.
Section 11.05. Management Contingency Plan. During an Emergency, the Corporation shall be managed by the Operating Committee under the direction of the Chief Executive Officer. In the absence of the Chief Executive Officer or his or her successor, the Operating Committee shall act under the direction of the Operating Committee member with the longest tenure with the Corporation.
Section 11.06. Liability. No officer, director or employee of the Corporation acting in accordance with the provisions of this Article XI shall be liable except for willful misconduct.
Section 11.07. Repeal or Change. The provisions of this Article XI shall be subject to repeal or change by further action of the Board or by action of the stockholders, but no such repeal or change shall modify the provisions of Section 11.06 of this Article XI with regard to action taken prior to the time of such repeal or change.
Section 11.08. Termination of Emergency. The provisions of this Article XI shall cease to be operative upon the termination of the Emergency as determined by a quorum of the Board or the Executive Committee thereof in accordance with Sections 2.06 and 3.01, respectively, of these By-laws.
- Sheriff: Vegas Shooter Led "Secret Life", May Have Planned Car Bombing; Tried To Ignite Jet Fuel Tanks
With every passing day, the Las Vegas police department releases new details about Stephen Paddock, the gunman behind the deadliest mass shooting in modern U.S. history, who according to the latest update, spent decades stockpiling guns and living a “secret life” and may have planned other attacks, including a car bombing, Clark County Sheriff Joseph Lombardo said, after suggesting that it was only logical to “make the assumption” that Stephen Paddock had “some help at some point” in pulling off Sunday’s massacre.
As evidence, Lombardo pointed to gunman Paddock’s huge arsenal, explosive materials found in his car and his meticulous planning. “What we know is Stephen Paddock is a man who spent decades acquiring weapons and ammo and living a secret life, much of which will never be fully understood,” the sheriff said. Lombardo also revealed that Paddock had an escape plan, even though he turned the gun on himself as police closed in on his suite at the Mandalay Bay Hotel.
Meanwhile, authorities are still searching for a motive. “Anything that would indicate this individual’s trigger point, that would cause him to do such harm, we haven’t understood it yet,” Lombardo told reporters Wednesday. “Don’t you think the concealment of his history of his life was well thought out?”
Analyzing Paddock’s computer, cellphone and other electronic devices, investigators have found no obvious ideological motive, no clear connection to extremists or activist groups or outward display of mental illness, the Associated Press reported.
Earlier in the day, an Australian man who claimed he met Paddock several times in the Philippines told the Guardian that the shooter was “extremely intelligent, methodical, conservative — guarded — and strategic. A planning, thinking type of guy.” The man, who spoke to The Guardian on condition of anonymity from his Brisbane home, said the encounters came through their respective girlfriends, both Philippine-born sisters, who had family reunions.
He said he and Paddock had “robust” discussions about American gun laws and said Paddock mentioned a “gun room” during one stay in his home in Mesquite, Nev. “His comments were that it’s a substantial hobby that needs to be protected: ‘a gun room’,” the man told The Guardian.
Separately, NBC reported that Marilou Danley, Paddock’s girlfriend, said she remembers him exhibiting symptoms such as lying in bed and moaning, according to two former FBI officials who have been briefed on the matter. “She said he would lie in bed, just moaning and screaming, ‘Oh, my God,'” one of the former officials said. The other former official said Danley spoke about Paddock displaying “mental health symptoms.”
Investigators believe Stephen Paddock, who claimed nearly 60 lives and injured hundreds more in Las Vegas on Sunday, may have been in physical or mental anguish, the sources said.
Investigators are also examining approximately six media devices left behind by Paddock, one of the former officials said. Included in that search is an inquiry into Paddock’s web browsing history.
* * *
Meanwhile, as Fox News reports, the materials found in Paddock’s car – 1,600 rounds of ammunition, fertilizer that could be used to make explosives and 50 pounds of the explosive substance Tannerite — led authorities to believe the Paddock was possibly planning a car bombing.
Authorities also revealed that the weekend before the shooting, Paddock had rented a high-rise condo in a building that overlooked the Life is Beautiful alternative music festival featuring Chance the Rapper, Muse, Lorde and Blink-182. Lombardo offered no other details on what led Paddock there. Paddock also rented a room in August at Chicago’s downtown Blackstone Hotel, but never checked in. The hotel overlooks Grant Park where the Lollapalooza festival is held each year with hundreds of thousands of people in attendance.
Addition to the confusion is that as the AP notes, where other mass killers have left behind a trail of plain-sight clues that help investigators quickly understand what drove them to violence, Paddock had nearly no close friends, social media presence or other clear connections to the broader world. Even the No. 2 official in the FBI said Wednesday he was surprised investigators have not uncovered more about why a man with no obvious criminal record would cause so much bloodshed.
“There’s all kinds of things that surprise us in each one of these events. That’s the one in this one, and we are not there yet,” FBI Deputy Director Andrew McCabe said. “We have a lot of work to do.”
They wonder if he had some sort of mental break at the time that drove him to start making plans for mass murder. Authorities were looking for hints in the details of the kind of life he lived, and the kind of victims and venue he targeted, said David Gomez, a former FBI national security and criminal profiler.
“We may never know to 100 percent certainty,” he said. “But they will find out.”
* * *
In a tangent, overnight the Las Vegas Review-Journal reported that Paddock reportedly also took aim at nearby aviation fuel tanks during the rampage. The bullets fired by the killer left two holes in one of two circular white tanks. One of the bullets penetrated the tank, but did not cause a fire or explosion near the Route 91 Harvest country music festival. The tanks are roughly 1,100 feet from the concert site, where Paddock killed 58 people. Several airplane hangars belonging to prominent corporations are also near the tanks.
Within the past couple of days, a construction crew repaired the holes, and FBI agents inspected the tanks and took measurements of the line of fire from Mandalay Bay, the sources said. The bases of private aircraft companies are also close to the tanks, which sit on property owned by McCarran International Airport.
The tanks are operated by Swissport, the company that runs the fueling operations for the airport, according to McCarran spokeswoman Christine Crews. They primarily are used to provide fuel to the private aircraft operators.
According to the Journal, jet fuel is hard to ignite and tanks like those across from Mandalay Bay have mechanisms in place to prevent fires. Mike Boyd, a Colorado-based aviation consultant, echoed those words. “A machine gun is not going to blow up a tank of fuel,” Boyd said. “Jet fuel itself sitting there in a big wet pile is very hard to ignite. You have to be a very amateur terrorist to think anything like that.”
Which would make sense: earlier in the day ISIS “tripled down” on allegations that Paddock was both a convert to Islam and operating on its behalf in its just published edition of its weekly Naba newsletter. The Islamic State propaganda newsletter featureed infographs and new specific claims concerning Paddock, who the terror group identifies according to the Muslim name, Abu Abdul Barr al-Amriki (or Abu Abdul Barr “The American”) and claimed “converted six months ago” to ISIS.
- Previewing The September "Hurricane-Disrupted" Jobs Report
Tomorrow’s hurricane-affected September jobs report will be… confusing. That is the (lack of) consensus from Wall Street analysts, who expect an average print of 80,000 (down from the 3-month average of 185K), however with huge variance on either side, with 4 economists predicting a loss of jobs, three expecting a print higher than 150K and one optimistic forecaster going as high as 260,000.
The amusing breakdown by bank is as follows:
- Hugh Johnson 153k
- Stadnard Chartered 150k
- UBS 125k
- JPMorgan 100k
- Bank of America 80k
- Citi 70k
- Wells Fargo 55k
- Goldman Sachs 50k
- Deutsche Bank 50k
- SocGen -25k
- Jefferies -45k
Of course, the numbers are so scattered (as to make tomorrow’s report meaningless) due to the negative distortions from hurricanes Harvey, Irma, and Maria. The payroll survey is designed to ask employers about their number of employees for the pay period that includes the 12th of the month. Hurricane Irma made landfall just prior to the workweek containing the 12th of September. For workers who are paid on a weekly basis, if they were not able to work that week following Irma’s landfall, they may not be counted in the payroll report.
Still, while jobs may be depressed due to the hurricanes, the impact on average hourly earnings would be the opposite. As Citi’s desk notes, the hurricanes themselves may put upward pressure on earnings given overtime paid as companies have a hard time finding workers. The street is fairly split on this fact, with 23 of the 57 economist submissions so far with an estimate of 0.2 or below (2 estimates at 0.1%) and the rest calling for 0.3% or above (4 estimates at 0.4%), although this may understate risk for a positive surprise.
With that in mind, here is a summary of what to expects tomorrow at 8:30am, courtesy of RanSquawk
US NONFARM PAYROLL PREVIEW – SEP 2017, ANALYST FORECASTS (forecast, range, previous):
- Non-farm Payrolls: 80k (-45k to 209k, Prev. 156k)
- Unemployment Rate: 4.4% (4.3% to 4.6%, Prev. 4.4%)
- Average Earnings Y/Y: 2.5% (2.4% to 2.7%, Prev. 2.5%)
- Average Earnings M/M: 0.3% (0.1% to 0.4%, Prev. 0.1%)
- Average Work Week Hours: 34.4 hrs (34.2 to 34.6 hrs, Prev. 34.4 hrs)
- Private Payrolls: 83k (-25k to 199k Prev. 165k)
- Manufacturing Payrolls: 10k (-20k to 40k, Prev. 36k)
- Government Payrolls: No forecasts (Prev. -9k)
- U6 Unemployment Rate: No forecasts (Prev. 8.6%)
- Labour Force Participation: No forecasts (Prev. 62.9%)
TRENDS:
Headline non-farm payrolls have averaged 176k in the first eight months of 2017, slightly lower than the 187k 2017 average. But the trend rate of payroll growth has picked up in recent months; on a three-month rolling average basis, payroll growth averaged 185k in August, which is roughly in-line with the trend over the last three-months, and above the 175k twelve-month rolling average. Over the last five years, payrolls in September has averaged 204k, though it is worth noting that this month’s data will be distorted by the impact of Hurricanes Harvey, Irma, and Maria.
“Expectations are heavily discounted due to the recent hurricanes,” write analysts at Lloyds. “The natural disaster is going to leave the data unclean for a while and the release would have to be significantly weaker than anticipated for the market to start discounting a December rate hike from the Fed.”
HURRICANE IMPACT:
Analysts at Capital Economics estimate that the hurricanes may have cut payrolls growth in half. “We already know that Hurricane Harvey caused jobless claims to spike in Texas. The rise in claims was smaller than that seen post-Katrina in 2005, but was larger than the impact from Ike in 2008. The rise in claims in Florida following Hurricane Irma so far has been negligible.”
State-Level Jobless Claims Data Suggests a Larger-than-Normal Payrolls Impact from Hurricanes Harvey and Irma
In 2005, Hurricane Katrina resulted in two months where payroll growth languished beneath 100k (versus the six-month trend of around 250k being added on a monthly basis).
Hurricane Ike is a more troublesome example to look for clues about how payrolls react, given that Lehman Brothers collapsed two days after the hurricane hit, CapEco says.
Looking further back, Capital Economics notes that payroll growth fell by around 100k in the aftermath of Hurricane Andrew in 1992, which was the largest storm on record to hit Florida at the time.
WAGES:
In its latest policy statement, the FOMC noted that “job gains have remained solid in recent months, and the unemployment rate has stayed low”, but “market-based measures of inflation compensation remain low”. Accordingly, despite the expected distortions to this month’s data, analysts will be looking to see if the wage inflation story remains intact, reinforcing the narrative behind a December rate hike.
ING’s analysts believe “a decent wage number should help cement market pricing of a December hike,” and are more optimistic than consensus, forecasting annualised wage growth of 2.6%, arguing that calendar quirks may drive a strong print.
Last month’s data was disappointing, ING says, but can be attributed to a change in the number of work days between the calendar months. The bank notes that where there were two additional workdays in the August, there were two fewer in the September month.
“Of course, these statistical quirks tell us nothing about the economics. The tight labour market and increasing job-to-job flows should drive up the pace of pay rises over coming months. But it is a slow-moving picture and we may struggle to see growth above 3% this year.”
MARKET INDICATORS:
CLAIMS: The most recent data shows initial jobless claims at 268,250 on a four-week moving-average basis, higher than the 250,250 going into last month’s Employment Report. However, it seems that this jump was more mild than analysts had foreseen. “We feared a big spike in claims as a result of Hurricane Maria hitting Puerto Rico, but it didn’t happen,” writes Pantheon Macroeconomics. “Given the extent of the devastation and the subsequent drop in economic activity, this is odd.” Pantheon notes that the lingering impact of Harvey and Irma kept claims above the pre-storm trend around 240k, and believes that a reversion to these levels will be seen in a matter of weeks. “We have no reason to think that the underlying labour market has changed much since August,” Pantheon says.
ADP: The ADP’s measure of payroll growth was more-or-less in-line with expectations, showing the addition of 135k payrolls in September. But the tone of the commentary was generally positive; Moody’s chief economist Mark Zandi said “Hurricanes Harvey and Irma hurt the job market in September, but looking through the storms, the job market remains sturdy and strong.”
CHALLENGER JOB CUTS: Challenger reported announced job cuts by US employers fell 4.4% MM, while they lodged a 27% YY fall. Looking at Q3 as a whole, job cuts were down by 6.2% QQ and were 22.5% lower than Q3 2016. The data continues to paint a picture of a healthy labour market. “Job cuts have remained low since the second half of last year. As companies grapple with potential deregulation and changes to health care costs in a tight labour market, employers are holding on to their existing workforces while many positions requiring skilled labour go unfilled,” Challenger noted.
ISM SURVEYS: The employment sub-indices for both the manufacturing and non-manufacturing ISM surveys rose in September by 0.4pts and 0.6pts respectively. That marked the 12th straight month of employment growth in the manufacturing sector, and the 43rd consecutive month of growth in the non-manufacturing sector. And this is similar to the findings from the IHS Markit PMIs; for the manufacturing sector, employment growth was the fastest in nine months, though Markit noted that growth was running hotter than output, which signals that productivity may be slipping. The services PMI, however, saw employment growth slip to a three-month low, though Markit said it was still “solid” in September.
* * *
WHAT BANK DESKS ARE SAYING:
Barclays: We look for nonfarm payrolls to expand by 75k, down from 156k in August. Informing our view are initial and continuing jobless claims, which have risen following the landfall of Hurricanes Harvey and Irma. Offsetting this to some degree are other factors like part-time employment for economic reasons and the employment diffusion index, which have shown improvement in recent months. Elsewhere in the report, we look for private payrolls to rise by 70k. We also expect average hourly earnings to rise by 0.3% m/m and 2.6% y/y, while average weekly hours remain unchanged at 34.4. With the slowdown in employment growth on the month, we expect an unchanged unemployment rate at 4.4%.
Deutsche Bank: we expect only a 50k gain on headline nonfarm payrolls (+50k private). However, this may be enough to keep the unemployment rate steady at 4.4%. In fact, the “weather workers” series within the Household survey should provide a reasonable sense of the magnitude of the hurricane related disruptions to the payroll data.
Goldman Sachs: We estimate that nonfarm payroll growth slowed to +50k in September, below consensus of +80k and the 3- month average pace of +185k. Our forecast reflects the widespread flooding and power outages caused by Hurricanes Harvey and Irma, which affected over 10% of the population and caused over $100bn in damages. The impact on tomorrow’s report is highly uncertain, but our base-case assumes a significant impact of -125k that partially offsets continued job growth in the rest of the country. We also expect the hurricanes to weigh on the household survey results, and given the high unrounded level of last month’s unemployment rate (4.442%), we believe the September jobless rate is more likely to round up than down (we estimate a rise to 4.5%). Finally, we estimate average hourly earnings increased 0.4% month over month and 2.7% year over year, reflecting positive calendar effects.
Citi: Hurricane-related distortions to September payrolls imply market sensitivity to this month’s jobs tally will be lower than usual. Focus will be on wage growth for signs of inflation given last week’s soft PCE deflator print. We expect growth in average hourly earnings of 0.3% MoM (on-consensus) and 2.6% YoY (above-consensus), but see risks of a 0.4% print from a possible hurricane boost. Our forecast is for nonfarm payrolls growth of 70K (consensus: 80K) based on an analysis of initial claims data around past hurricanes. It would likely take a substantially below-consensus print (around flat or negative payrolls) to induce a large market reaction. Instead, the market may be more sensitive to upside surprises as a strong reading would imply either a smaller-than-expected impact from the hurricanes or stronger ex-hurricane job growth. Any hurricane-related softness in the September report will likely subsequently revert and boost the October payrolls report, as activity in the hurricane-affected areas returns to normal. Hurricane-related boosts to average hourly earnings will be temporary. Still, boosts to GDP growth from reconstruction will contribute to further labor market tightening, and with solid underlying growth, should lead to stronger wages over time.
ING: With this month’s payrolls number likely to be “written off” given the effect of recent hurricanes, a decent wage number should help cement market pricing of a December hike. But in reality, if the Fed decides not to move at the end of the year, it’s unlikely to be because of economics. Instead, the new debt ceiling deadline falls almost right on top of the December meeting and given the divisive nature of US politics, it could go down to the wire. A substantial pick-up in market volatility on the possibility of a government shutdown could conceivably see the Fed delay until 2018 – although that’s not our base case.
RBC: The survey period for the September employment report (the week that includes the 12th of the month) began as Hurricane Irma was making landfall in Florida and as Texas was still reeling from the effects of Hurricane Harvey. Thus, we will be shocked if we don’t see a significant slowing in nonfarm payroll growth on the month. Our best guess (given what Texas and Florida have added to payroll growth recently and trends in unemployment insurance claims in these states in the wake of the Hurricanes) is that headline and nonfarm payroll growth will slow to around 50K on the month, against a 6-month trend of around 160K. There is incredible uncertainty in this forecast and this is also reflected in the range of Street estimates (from -25K to +145K, if we throw out the highest and lowest guesstimates). Given the probability we get a very messy report is high, the market is likely to fade any weakness.
SocGen: Hurricane Harvey may have led to a decline in nonfarm payrolls in September, which would mark the first negative reading in seven years. Quantifying the hurricane’s impact on job growth is fraught with uncertainty, but we suspect that Harvey’s impact was similar to the drag on payrolls seen in the wake of Hurricane Katrina in 2005.
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