- The Finance Gourmet

Unemployment Rises Less Than Expected

December 8, 2021December 2, 2021 by Finance Gourmet

Ah, the world of finance, where the rules are made up, and the points don’t matter. OK, I stole that from Phineas and Ferb, but sometimes it fits better than it does even for a fake game show. Today, unemployment numbers were released in which the number of Americans filing for unemployment increased. That means more Americans are jobless than before, despite the so-called worker shortage and the Great Resignation. Don’t forget, you don’t get to file for unemployment when you quit, so these are still Americans who were fired, downsized, let go, or their employer closed. More unemployed Americans is bad, in general, but… Economists were predicting (modeling, similar to what meteorologists do) that there would be even more Americans filing for unemployment, so the fact that more Americans are unemployed, but not as bad as we thought, is good news. Kind of. Check out my review of the new fintech investing apps. The reality is that numerous traders and investors made their trades expecting higher unemployment numbers would push down the price of securities and investments. Since they were wrong, the price of those investments are rebounding. This is “good news” in the world of finance, and a …

Extra Unemployment Ends

September 10, 2021 by Finance Gourmet

Here in Colorado several restaurateurs wrote a letter to Governor Jared Polis earlier this summer asking him to join the other states that ended the extra unemployment benefits enacted in response to the global Covid-19 panic. Their theory was that the higher unemployment checks were keeping restaurant workers on the sidelines making them unable to appropriately staff their restaurants. Extra $300 Unemployment Payment Ends Until earlier this month, many recipients of unemployment were getting an extra $300 per week. This is a substantial amount considering typical unemployment benefits are around $400 per week under normal circumstances. Another way to look at is that the $300 per week represents $7.50 per hour when compared to a full-time 40-hour workweek. The restaurant owners concluded that the ability to earn a total payment of approximately $700 per week, or $17.50 per hour as a 40-hour workweek. With numbers like that, it’s no wonder that hard working restaurant jobs paying near minimum wage of $12, or even $13 or $14 per hour would not entice workers to come back. Supporters of the extended benefits looked at the same data and concluded that it is the restaurateur’s own fault for paying such low wages. Who …

New Home Sales Up During Covid

September 24, 2020 by Finance Gourmet

An interesting wrinkle in the new Covid economy showed up today. The U.S. Department of Commerce reported that new home sales in August rose by 4.8%, on top of a spike 13.9% in July. Buying New Homes Overall home sales are having difficulty in no small part because home buyers are reluctant to do several showings in a day in a Covid world. Those showings are what motivate buyers to purchase existing homes. Unlike existing home sales, new homes are typically sold via model homes. Model home are shiny, bright, and seem cleaner, even though more people may actually move through them each day. Furthermore, rather than having to see numerous homes to find the perfect one, buyers need only find a model they like. Builders then allow buyers to tweak that model. Low Mortgage Rates Record low mortgage rates are also helping drive sales for new construction. Unlike existing home sales that are dependent upon subjective appraisals, lenders can easily get a feel for the current value of the one of many new buildings a particular buyer looks to purchase. Is Zelle a scam? Finding a mortgage, however, even for new construction is getting harder. It turns out lenders …

The Not Quite Goldilocks Economy

December 18, 2019 by Finance Gourmet

Everybody loves the idea of the Goldilocks Economy. Not too hot. Not too cold. Just right. The Fed is leaving interest rates unchanged, and telegraphing that is currently isn’t planning on making any changes next year either. Stock market pundits have given up on calling the impeding doom of a stock market crash (at least for this month). Job reports show job growth, but not too fast of job growth. And while wage are growing, they are doing so slowly. Not Goldilocks However, you won’t see a lot of articles on a Goldilocks Economy happening. While things are definitely not too hot and not too cold, there is a connotation with Goldilocks that things are inherently good. This economy seems more like the negative version of a Goldilocks situation. As in things aren’t too bad, as opposed to things are too good. In a way, this is better for investors and the economy in general. Too much optimism can turn a mild-mannered, almost Goldilocks economy into a runaway bubble and no one wants that. The next year will be very interesting. Once the holidays are past and the country stops paying attention to impeachment in Washington, the reality of just …

Real Work From Home Jobs Amazon

September 21, 2016 by Finance Gourmet

A surprising number of people come to this website looking for information on real, non-scam, work from home jobs. Unfortunately, many of them leave discouraged, because there are so many work from home scams out there. That does not mean that there are no work from home jobs, there are actually tons of real work at home jobs, they are frequently referred to as telecommuting. What are almost always scams, are jobs that only require a few hours, no skills, not much work, and have high pay. Honest Work From Home Job Opportunity I happened to come across a news story about Amazon hiring work from home customer service employees for the holiday season. These are seasonal jobs, so they may just be temporary, but they are real telecommuting jobs from a real company. If you look at the job’s posting, you can see how to spot the difference between a real job offer, and a fake work from home job. First up, note the pay. This is no “Make Six-Figures Working From Home!” job posting. The pay is $10 per hour. Whether that is enough or not, is a personal decision, but it is realistic. An entry-level customer service position …

June Jobs and Mid-Year Economy Review

July 8, 2016 by Finance Gourmet

Monitoring the economy is tricky business. The monthly reports that we get from the government require gathering reams of data over hundreds of hours, and all manner of processing to get us a simple sounding number like, “The U.S. economy added 287,000 new jobs.” Even then, those numbers are routinely readjusted up or down later as more data comes in. The May employment numbers were enough to stop a Fed rate hike in its tracks. Are the new June numbers good enough to put an interest rate increase back on track? June Employment and the Fed Employment numbers are very important to the Fed. A tightening labor market often is visible before any actual signs of inflation. The theory is that lower unemployment forces businesses to offer higher wages in order to attract and retain workers, which will eventually lead them to raise prices in order to cover higher costs. So, if employment jumps too fast, too far, it might be time to take a look at a rate hike. The increasing transparency and ability to buy goods online has shaken this up a bit, however. Just because Macy’s raises prices on something doesn’t mean that you have to pay …

June Rate Hike Is Off

June 3, 2016 by Finance Gourmet

Last week, the April inflation numbers came in a little bit high. At the time, I (and several other analysts) pointed out that the higher number was almost all due to a long coming recovery in fuel prices, and that even with that higher number, inflation was nowhere near being a real issue. However, the Fed members went running to just about any media outlet that would listen telling everyone that those shaky numbers were the reason the Fed was very likely to raise interest rates in June. I wrote at the time, that it seems like this Federal Reserve is more interested in showing that they are inflation hawks than they are interested in following the actual data. The Federal Reserve has two official mandates, to keep inflation in check, and to keep employment as close to full employment as possible. This begs the question of why, exactly, the Fed seems so keen on raising rates right away. Employment is doing better, but nowhere near full, and wage growth is stagnant, so no issues there. The twelve month inflation rate, even with April’s increase, is just 1.1 percent, well short of the Fed’s supposed 2.0 percent inflation target. A …

Job Losses Now Due to Market :)

March 14, 2016 by Finance Gourmet

Not too long ago, I wrote about how context in articles and statistics is critical regarding the huge boom in employment in North Dakota. Now, North Dakota and a handful of other states lead the U.S. in job losses. Of course, not too long ago, the gains in these states were due to the genius of their governors or legislatures. Now, it’s just market forces. Of course, it was the same thing both times around, the oil and gas industry. When oil was booming and drillers were hiring as fast as people would show up, job growth exploded in North Dakota. Now, that oil prices have plunged and the industry is mothballing rigs, while entirely stopping drilling new ones, employment numbers are crashing. Context is everything. Overall, nothing new is happening, good or bad, in the states with the greatest number of job losses, it is just that in one particular industry, the bottom fell out. Interestingly enough, this might be the actual bottom, meaning that there is nowhere but up for these job numbers to go. When they do start climbing, watch for the politicians who claim no blame for this downturn, come scurrying out of the woodwork to …

Fed Telegraphs Slower Rate Hikes

February 25, 2016 by Finance Gourmet

The Federal Reserve, via its members, is out announcing that the rate hikes everyone was sure were coming this year, after the December interest rate increase are, in fact, on hold, until the markets and the economy stop being so shaky. Fed Members Nudge Wall Street Off of Hike Forecasts The St. Louis Fed President, James Bullard, said in an interview that rate hikes during 2016 were never a sure thing. He is right that the Fed often, and deliberately, said that rate hikes were dependent upon data going forward, but the markets didn’t believe them, pricing in a full 1% interest rate hike over 2016, and every analyst under the sun talking about a steady march up in interest rates. Bullard blames the previous Fed under Fed Chairman Bernanke for “mechanically” raising interest rates 17 straight times from 2004 to 2006 (and likely triggering the nationwide real estate slump that ended up all but crashing the U.S. banking system in 2007). He says that because of that chain of increases, everyone simply assumed that this year would have similar, albeit slower, rate increases. Bullard leaves out that many of the other current Fed members (including himself) could say often enough …

Higher Minimum Wage in 2016

January 22, 2016 by Finance Gourmet

We’ve talked a bit about minimum wage increases here before. In particular, I’m interested in the effects these minimum wage increases end up having. Most reports you read, whether positive or negative, are pretty much pure speculation, or cherry picking of data to fit an agenda. The reality is that the whole, higher minimum wage movement is still too young to produce the kinds of data needed to draw actual, mathematically and economically sound conclusions. Where Is Minimum Wage Higher in 2016? Part of the problem with knowing how higher minimum wage affects things is that it is nearly impossible to isolate individual geographic regions from the power of the national economy. This is particularly true for cities that are raising their minimum wage. Since employment in the U.S. is picking up after having been slammed by the Great Recession, most areas, regardless of minimum wage laws, are seeing higher employment. Still, the only way to find data is to look for it. First, the federal minimum wage is $7.25 per hour. No Minimum Wage Increase for 2016 There are seven states that either have no minimum wage laws, or a state minimum wage law below the federal minimum (Georgia, Wyoming). They …