Laugh all you will, but I like Jim Cramer. I know he's a buffoon sometimes, but he's entertaining, and I also think he's actually very talented. He doesn't get the credit he deserves. Here's a perfect example.
While everyone is worried about the US initial jobless claims number rising this week, he goes and takes a look at the situation from another angle. He looks at the results of Paychex, a provider of outsourced payroll services. He noted that the "cheques per client" metric is up this year, which indicates that employers are continuing hiring rather than laying off people.
I appreciate this kind of out-of-the-box thinking. You don't necessarily need to look at the widely used economic indicators to find out what's going on. Sometimes they are not that accurate. I've come up with my own indicator for retail companies using Google Insights. I talked about it here.
In any case, take a look at what Cramer's got to say...
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This QE thing is a disaster waiting to happen everytime the government prints more dollars the less their value. I believe that creating money out of thin air can only result in one thing and that is inflation. The growing inequality over the last three decades has been caused in large part because employees particularly low skilled and unskilled employees do not get an increase in their compensation that equals the increase in living costs. This will just cause the bottom third of the population to become more and more dependant on friends family private charities and the government for their support instead of their employers.
ReplyDeleteDennis, I really don't know what to make of QE. If QE1 did not occur, would the world economy have been better off than it is now? I don't think so. Things would probably have spiraled out of control and we would have gone into a severe depression like the 1930s. Does QE3 help? That's a more valid question. There are those who say we're going back into a recession. In that case, deflationary pressures may become higher. So, QE may actually offset that deflationary pressure and keep prices steady (which is good for the economy). But reckless money printing would definitely result in inflation. But to date, I don't think that has happened yet. Exciting times indeed!
ReplyDeleteThe recent job numbers are not impressive.
ReplyDelete