June | 2012 | Blue World Asset Managers

Blue World Employment Situation Report Analysis

Release Date: Usually the first Friday of each month

Market Sensitivity: VERY HIGH

Management Value: VERY HIGH

Friday, June 01, 2012

Brain surgery is not rocket science to a brain surgeon©

Well, we think this report speaks for itself. We find it amusing that the government summary described the unemployment rate as “essentially unchanged.” When it drops by a tenth that’s an improvement. When it rises a tenth that, apparently, is “essentially unchanged.”

Wages were flat and actually down a bit in areas like manufacturing, leisure/hospitality and utilities. The much bigger concern when added to that is the reduction in the length of the work week in manufacturing and construction with manufacturing overtime hours remaining in a narrow range between 3.1 and 3.3 hours per week. These are all well below any levels that could presage more hiring. We think that’s as deep as we need go in a report that speaks for itself.

Let’s spend a minute addressing the “why” such poor results are being reported. We can’t say it enough. Policy matters and these don’t work. Businesses are doing exactly what you and I would do in uncertain times. They would conserve cash, reduce spending to the bare essentials and wait for a clearer picture. Why are times uncertain? Because no one knows what Congress is going to do with the tax code before year end, the fate of Obama Care is unknown, an upcoming election could perpetuate or totally reverse current anti-capitalistic policy and, oh yeah, Europe is trying really hard to implode. If any of this sounds like a recipe for job creation and economic growth to you we have some real estate we’d like to offer you!

Policy matters, folks, and these don’t work.

Thanks for reading and, please, stay tuned…

Release Site: www.bls.gov

Every effort is made to ensure accuracy of data transcription but accuracy cannot be guaranteed. The official release site should be cross referenced. The analysis represents the opinion of Blue World Asset Managers, Ltd. who does not warrant or guarantee predictions based on its analysis.