I live in South Florida so I've been through at least a half dozen direct strikes and even a cat. 1 (while not very dangerous, we use to hang on to the pilings of the fishing pier and let the waves slam in to us and see who could hold on longest... bright idea huh?) can do enourmous damage with huge costs even in an area that has a building code that is meant to withstand storms a lot stronger. I was about 50 miles from Andrew's land fall and hoonestly it was about a 30 mile an hour breeze because Andrew was so small in size, however it packed incredible winds. My father was a General Contractor and was working down there and saw re-inforced concrete bunkers for the Air-Force reduced to rubble. Apparently at that same facility they clocked sustained winds at 230 mph, which no news organization ever reported. There were also thousands of migrant workers who live in what can only be called "Shanty's" on the edge of the Everglades working the fields in the area who lost their lives. Early on my father was told by sources in the Florida National Guard that they had recovered over 5,000 bodies very early in the effort and almost 9,000 mobile homes were wiped off the map, so no one ever hear the true death toll, just official numbers usually around 19 to 24 people.
This storm is clocked at 195 sustained and 235 gusts, I can tell you they are a lot higher than that with 195 sustained, that's like a huge tornado hitting, not a hurricane and this thing is HUGE. I hope we all can take a moment to send some prayers and positive thoughts their way and maybe some logistical/food/batteries/flashlights/blankets/water or donations afterward, we needed it in sunny Boca Raton, I can't tell you how badly the Philippines will need it.
OK SO THE PUNDITS WERE WRONG AGAIN. The Non-Farm payrolls came in at +204k which is quite a bit above consensus of 120k. Goldman said 100k and JPM 75k.
This is what happened to ES...
ES had gone from 1744.75 at 4 p.m. yesterday down to 1736.50 on the NFP and opened amazingly right around $1744, just about where the 4 p.m. print left off yesterday, coincidence?
By looking at the chart above it looks to me the NFP was either leaked which the BLS has admitted, has been leaked enough times that this is why they are building a new media center to prevent leaks. Or perhaps the mini cycle I gave good evidence of last night... and yesterday across 3C, Leading Indicators, sentiment, Dominant Price/Volume Relationships and many other signals was just not going to be derailed.
Gold so far is acting as if the market expects a Taper in QE soon, but, I think the short term cycles will change that.
The truth is to understand what the market is truly thinking, I need to post several charts of each asset because right now we are seeing short term signals that I believe are a part of the mini cycle I mentioned yesterday and last night I gave good indications across many assets and indicators.
Treasuries also are knee jerking, but should see a change soon. There's controversy from Nanex that is showing oddities just before or milliseconds after the report in both gold and Treasuries as the bond market was halted for 5 seconds immediately after, the largest, most liquid bond market in the world, we'll leave that for NANEX to figure out, we have our own strange information.
The official consensus for the NFP was 120k, with Goldman and JPM coming in even lighter and the Unemployment rate to rise from 7.2 to 7.3.
The UE rate came in at consensus, but the NFP added nearly double most estimates at +204 gain, however this is not without controversy and thus it's important to look very closely at QE related assets to see what is truly going on after this print that WAS SUPPOSE TO BE A NON-EVENT!!!
Among the inconsistencies in the report, the Household Survey came in at 213k which isn't far from the Headline print of +204k, but... it seems when breaking down the components of the same Household survey, 623k full time jobs were lost in October which works to offset the total 691k gain. Part time jobs did not take up the slack in the Household Survey as they saw a print of -127k for a loss of 750k.
I'm sure the Labor Force participation rate explains the inconsistencies in what seems to be a goal - sought print.
According to the Labor Force Participation Rate, 9932,000 Americans dropped out of the labor force in OCTOBER from 63.2% to 62.8%! This would be a 35 year low not seen since 1978. Data shows the nearly 1 million people dropping OUT of the labor force in October ALONE is the 3rd highest drop in the history of the US.
Again, all I can say is it seems the data was what we call, being "Goal seeked or goal sought", I think there's a clear reason for that that and we may have time to get in to later, but it has to do with the DANGER the F_E_D's balance sheet is in, remember they are a FOR PROFIT Corporation with shareholders they report to.
More coming, but first there's a lot to deal with in the market.
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