Sunday, May 22, 2011

Did anyone else see that strange yellow ball in the sky on Sat?

After a week of rain I'd almost forgotten what the sun looked like. However, thankfully we'll get back to a pattern of daily rain for the rest of the week.

The European credit crisis is back in the news (this is not a repeat of May 2010). Greece appears to be really up against a wall at this point and I'm not sure they have any chips left to play. Italy's outlook was downgraded on Friday and Spain is still cracking down on protesters. Look for Europe to be the main driver of news flow this week.

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I've read some fairly coherent research recently that makes a good argument that the Fed is painting themselves into a corner. On the one hand they want to spur investment and growth through policies that pump money into the economy. However, these same policies are having an inflationary impact on items that you and I need every day like food and gasoline. If the Fed tries to fight the increase in oil prices, they'll probably curtail any job growth, but higher oil prices might stall job growth anyway. Ah, this is why I went into finance and left economics to others.

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Stat of the Day

* With one-in-five men age 25-54 unemployed, the U.S. has the smallest share of prime-age working men of any country in the G-7.

Bonus stat of the day: “The biggest growth in private-sector job creation in the past year occurred in positions in the low-wage retail, administrative, and food service sectors of the economy. 49% of new jobs added in the sluggish ‘recovery’ are in low-wage industries.

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Congratulations to all of the new college graduates that have entered the next stage of their careers. While every college is proud to discuss the number of graduates that cross their stage every year, a more important question for parents and students is: What percentage of your graduates are employed in a field related to their degree 6 months after graduation?

That is a number that every college should post right next to their graduation numbers. Unfortunately, I bet the percentages for most schools would be shockingly small.

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One final economic data point - The early May new car sales seem to be off to a "dismal start" according to one industry expert. Blaming higher gas prices and supply disruptions due to the Japanese earthquake JD Power says summer sales are off to a very weak start and may pressure the 2011 outlook.

Just something to watch.

Cheers!

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