2012 January | timiacono.com

The chart below from this study by the CBO (Congressional Budget Office) has had a good deal of discussion today (see here and here, though there are probably a lot more by now) and for good reason. It used to be that you took a public sector job knowing that the pay wasn’t so hot but the benefits were good. Now you get both!

The CBO apparently tried to make this an apples-to-apples comparison by controlling for the many variables that affect wages and benefits and it seems to make sense – unless you’re a doctor or lawyer, you’re better compensated working for the gubment.

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It Helps to Have Friends in High Places…

Wow. That was one lucky unemployed engineer whose wife happened to be hanging out at Google+ when President Obama popped in and, to make a short story even shorter, promised to help find him a job. Details are in this MarketWatch story by Greg Robb.

President Barack Obama jumped into a new social media format on Monday and, as if he doesn’t have enough to do, ended up promising a worried spouse to help find a job for her unemployed husband.

Obama got the assignment during a live-streamed interview organized by Google Plus, the online search giant’s new social networking site.

The forum was designed to show off Google Plus’ new “Hangout” feature, where several friends can video chat together.

“Industry tells me they don’t have enough highly-skilled engineers. If your husband is in that field, we should get his resume and I will forward it,” Obama told Jennifer Weddel of Fort Worth, Texas.

Obama seemed surprised to hear that a semiconductor engineer was unemployed.“I will follow up on this,” Obama said.

Well, hopefully he’s a “highly-skilled” (and highly-degreed) engineer and not just one of those folks who call themselves an engineer because they once manned a technical support phone line for Microsoft or somesuch. I can’t imagine what it would be like to still be working my old cubicle job – it’s coming up on five years now since I left that behind and, as each year goes by, it seems as though it’s another three years in the past.

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Surge in Consumer Confidence Stalls

Following word that home prices continued to fall last fall as noted here earlier today, news comes from the Conference Board that consumer confidence declined for the first time in three months, down from an upwardly revised 64.8 in December to 61.1 in January.

Importantly, this is the first major gauge of the mood of the consumer to reverse course in recent months as, apparently, those holiday credit card bills have begun to take a toll.

Recall that a surprising surge in credit card usage during the fourth quarter was credited with driving holiday sales higher and, now that those November and December charges are starting to show up in mailboxes in January, the mood is not quite as festive.

Well, gasoline prices starting to rise again doesn’t help either…

The present situation component nearly reversed last month’s gain, falling more than 8 points to 38.4, while the expectations component also declined, from 77.0 in December to 76.2 in January. One-year inflation expectations rose from 5.3 percent to 5.5 percent, in stark contrast to Fed Chief Ben Bernanke’s claim that inflation is too low.

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Case-Shiller: Home Price Declines Accelerate

Standard and Poor’s reported that the November data for the Case-Shiller Home Price Index indicated further declines, the 20-city index falling 1.3 percent for the second straight month as property values declined in 19 of the 20 cities, also for the second month in a row. On a year-over-year basis, the 20-city index is now down 3.7 percent.

On a seasonally adjusted basis, home prices were down only 0.7 percent with three cities seeing gains and David M. Blitzer, Chairman of the Index Committee at S&P Indices, was not hopeful when he noted the following:

Despite continued low interest rates and better real GDP growth in the fourth quarter, home prices continue to fall …  The trend is down and there are few, if any, signs in the numbers that a turning point is close at hand.

It looks like policy makers in Washington might want to accelerate plans for the next attempt at rescuing the housing market, that is, before prices fall too much further.

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Tuesday Morning Links

MUST READS
Europe signs up to German-led fiscal pact – Reuters
EU Nears Greek Confrontation Amid Fiscal Pact – Bloomberg
European Politicians in Denial as Greece Unravels – Spiegel
Ferguson: Okay, I Admit It – Krugman Was Right – Business Insider
Regulators’ warnings about financial crisis were ignored – McClatchy
Freddie Mac Bets Against American Homeowners – ProPublica
Off Base Charges About Freddie Mac’s Mortgage “Bets” – Naked Capitalism
Freddie Mac gets paid to obstruct refinancings – Salmon, Reuters
Obama to help find job for unemployed engineer – MarketWatch
A few policies I expect soon – Calculated Risk
The Price of Growth – Chris Martenson
Book Review: Currency Wars – Mises

MARKETS/INVESTING
Oil above $100 on Europe’s austerity move, Iran – AP
Gold back in vogue, posts biggest gain since Aug – Reuters
WARNING: Stocks May Be About To Collapse – Business Insider
Short China: Its commodities bubble is set to pop – MarketWatch
Refineries close – no relief in rising gas prices – LA Times
2011 Investment Mea Culpas – The Big Picture
Investing for the cheap-money era – MSN Money
Gold Is The Hottest Currency In The World – Forbes
Spring Festival sparks a ‘gold rush’ in China – China Daily
World’s first Yuan gold ETF launched – Commodity Online

ECONOMY/WORLD/HOUSING/BANKING
Economics from the Ground Up – Mises
Why Is Unemployment Duration So Long? – FRBSF
The Bernanke Fed Is Killing the Economic Patient – RCM
Euro zone jobless hits highest level since birth of euro – Reuters
Wen: Property Curbs to Stay, Reiterates Fine-Tuning – Bloomberg
More quantitative easing likely after fall in money supply – Guardian
Japan Doubling Sales Tax Not Enough to Conquer Debt Woes – Bloomberg
Why a New Refinance Program Faces Long Odds – WSJ
US Treasury Forcing Mortgage Principal Forgiveness – CNBC
The Fed’s Rain Dance at the Bottom of the Stair – Testosterone Pit
A list: Experts who want to break up the big banks – RepoWatch
Bank or no bank? – inet

 
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