Happy Times Are Here Again!

I guess I am wrong about the economy, employment and the gradual slow down in durable goods, capex and GDP.*

My bad!

Its safe to say that with construction employment is on the upswing, the bottom in real estate must be here! And I guess with all this hiring, we best brace ourselves for the following:

-Big upswing in consumer spending
-Large decrease in Foreclosures
-Upswing in US Auto Sales
-Deceleration in personal bankruptcy filings
-Large increase in New Home Sales, Permits and Starts
-Significant gains in Existing  Home Sales and Prices
-Reversal of the Deceleration of Corporate Profits
-Improvement in Manufacturing Data and ISM
-Surge in Corporate Capital Expenditures

Yeah! Its a soft landing! The Business Cycle has been revoked! The worst is behind us! It turns out that Greenspan is a financial genius after all.

How could I have ever doubted any part of the economic system, from BLS to the White House to Wall Street!?!


Now, you listen to me! I want trading reopened right now. Get those brokers back in here! Turn those machines back on!  . . .  Turn those machines back on !


UPDATE:  April 6, 2007 4:45pm

*  See this for more details

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  1. Peter Pan commented on Apr 6

    Wow!! You run off to Lowes with your wife and four hours later you return as a changed man. Is Lowes that good? Is your wife that good? Did you and your wife do the wild thing in a secluded corner display at Lowes?

  2. dark1p commented on Apr 6

    Barry, this is the funniest damn post you’ve ever written! lol! Thanks!

  3. Sam Park commented on Apr 6

    Peter Pan, I think Barry is just showing his sense of his sarcastic humor.

  4. Steve commented on Apr 6

    That’s quite a conversion on the road to Lowes. Did you change your name to Paul?

  5. dblwyo commented on Apr 6

    Perhaps – but don’t we all know Barry has no sense of humor ? AFter all markets, the economy and making money are too serious to have fun with.

    No – we should a few moments of silence as a permabear is bitten by the data and reverses himself in a public act of contrition and mea culpas. Well sort of – BR not likely being Catholic and all.

  6. cm commented on Apr 6

    Not sure whether I mentioned it here or elsewhere, but over the past few weeks a property that has been derelict since at least 2000 is being used as an overflow parking lot by some car dealership. Somebody is not moving product, or is indeed bracing for increased sales soon!

  7. wally commented on Apr 6

    Don’t forget that we are going to see a huge increase in MEW as Americans – in fact, people around the world – reload for double dips and triple dips and take borrowing to incredible levels never before seen in the history of mankind!

    Safely and securely, I hasten to add.

  8. me commented on Apr 6

    Even the local Honda dealer has filled up the empty BJs parking lot. I thought Hondas were selling?

  9. Rick Hanley commented on Apr 6

    American Home Mortgage Expects Reduced Earnings — Last Update: 12:23 PM ET Apr 6, 2007

    …Michael Strauss, American Home’s Chairman and Chief Executive Officer, commented, “During March, conditions in the secondary mortgage and mortgage securities markets changed sharply…A disproportionate share of the Company’s non-performing loans are repurchased Alternate “A” loans…


    Yea, everything is just fine.

  10. Rick Hanley commented on Apr 6

    About 970 entities reported that their filings to the SEC will be late.

    The Wall Street Journal
    Companies Notifying SEC Of Late Reports
    Companies and other entities that are unable to file their quarterly and annual reports on time must notify the Securities and Exchange Commission. A deadline for many larger-capitalization companies to file annual reports was on Monday.

    Yea, everything is just fine.

  11. johntron commented on Apr 6

    so which will the market embrace…robust job growth (cough)…or higher interest rates/higher ARM mortgages?

  12. Eclectic commented on Apr 6

    Eclectic rushes Bondie, broken out in a sudden rash, to a local Doc-in-the-Box emergency facility in the neighborhood. There they are seen by Dr. Benber N. Anke:

    Anke: “Well, Mr. Eclectic… it’s kind of ugly looking, but I really don’t think it’s anything to be too worried about.”

    Eclectic: “But, Doc… she’s restless… she can’t hold down solid food, and when her fever got to 4.74 or so, I sort of freaked… and, I tell ya, Doc… I haven’t been too worried about Bondie until today when she broke out in this rash… What is it, Doc?”

    Anke: “Well, there’s a bit of this going around lately… it’s caused by a bug… my guess is it’s just the same rash we’ve seen in many other pre-pubescents.”

    Eclectic: “Pre what?”

    Anke: “Oh, sorry… I mean kids. We’ve seen a lot of other kids with this same thing… her diagnosis is probably the same rash as they all had… probably caused by the bug we call Conclusiarii Ridiculonius.”

    Eclectic: “How can you tell?”

    Anke: “See the red marks running up her back… the ones spiking upward… see there?”

    Eclectic: “Yeah, what are those marks?”

    Anke: “Those are known as rediculii… and I know they’re worrisome, but they’ll probably go away next week.”

    Eclectic: “Are you sure Doc?”

    Anke: “Pretty sure, but we’ve got a couple of other doctors on our staff that are usually better than me with these rashes.”

    Eclectic: “Who… and can we see them?”

    Anke (pausing, slightly distracted): “Goode – Friday.”

    Eclectic: “Well, I know it’s a holiday, but don’t they come in for emergencies?”

    Anke: “No, you misunderstood… We have a couple of other doctors that you might see… one of them is Dr. Harry Goode, and the other one is Dr.…”

    [Eclectic, impatient and worried, interrupts Anke]:

    Eclectic: “Is he really good?”

    Anke: “Goode?”

    Eclectic: “Good!”

    Anke: “Well, yeah he’s okay but he’s not as good on rashes as our other doctor, Dr. Nelson Friday, but he won’t be back until next week. I think Bondie’s rash could probably wait… until then… or, well if you’d want to wait that is?”

    Eclectic: “When will Dr. Friday be back next week?”

    Anke: “Friday.”

    Eclectic: “Okay… Well, Good!… We’ll see him then.”

    Anke: “So, that’ll be Goode for you then?… Mr. Eclectic?”

    Eclectic: “Yep.”

    Anke: ”Okay… well, he is pretty good, so suit yourself Mr. Eclectic… At least we can get started because he’s already here today.”

    Eclectic: “But I thought you said he wouldn’t be back until next week!”

    Anke: “You mean Friday?”

    Eclectic: “YES!… that’s what you said, FRIDAY!… Remember!!… You said ‘Friday’ and I said ‘GOOD,’ we’ll see HIM THEN!!”

    Anke: “I’ve ALREADY told you Mr. Eclectic… He’s here now, since you decided not to wait for Friday. ”

    Eclectic: “But, I DO want to wait for Friday!… Didn’t you say he was good??”

    Anke: “He is n-o-t Goode!… It’s Friday that I’m tryin’ to explain to you, Mr. Eclectic… Why don’t you just listen to me!!”

    Eclectic: “You don’t have to tell me it’s Friday… I know that already… Listen!!…Dammit!…………This is N-O-T* G-O-O-D!… you hear me!!”

    Anke: “The HELL it’s not Goode… I’ve worked with the S.O.B. for 10 years… I ought to know him!”

    Eclectic: “Friday???”

    Anke: “N-O***G-O-O-D-E!!”

    Eclectic: “But you said he w-a-s GOOD!! Will you please make up your f’ing MIND!!… Look, I tell ya what!… let’s just forget everything up to now… I’m sorry I lost my temper, okay. So, would you just please tell me… can I see another doctor T-O-D-A-Y that’s just better than Goode, yes or no?”

    Anke: “Well, Dr. Solomon was supposed to work today, but I really couldn’t say he was better than Goode, although he’s usually been about as good as Goode on rashes I suppose… but it’s all beside the point anyway.”

    Eclectic: “Why’s that?”

    Anke: “Unfortunately, Dr. Solomon won’t be here for his regular weekend shift and we don’t have anyone else to cover, with it being a holiday and all.”

    Eclectic: “Oh, I see… S-o-l-o-m-o-n… yeah I get it… Passover weekend, right?”

    Anke: “No…passed away… I’m sad to say he dropped stone dead of a heart attack at his grandson’s bar mitzvah yesterday.”

    Eclectic: “Well, Doc… does that leave us with any other possible doctors we might see?”

    Anke: “There is one… an old associate of mine… Dr. A. Lang Reenspan… he’s sort of semi-retired, but, uh…I do think he’ll…”

    Eclectic (interrupts): “You think he’ll see Bondie’s rash on Passover weekend?”

    Anke (chuckles): “Are y-o-u kiddin’ me??… He’ll work Passover, Passunder, Passaround…. Pass your plate… No Passing in curve…. No Passing stopped school bus…. [Eclectic (tries to get attention): “Doc!!… Doc!!!] — [Anke (not stopping)]: ”… Passthrough… Do not Pass, No Passing on shoulder, Do not Pass Go, Passout, Passgas, Please Pass the salt, Go long for a Pass……No Passing lane……and on, and on, and on…”

    Eclectic sees that Anke is off on some tangent all his own and it’s become useless to stay, and so he takes Bondie and just walks away from the chuckling, mumbling Dr. Benber N. Anke.

  13. SINGER commented on Apr 6

    we need that crop report

  14. Mike M commented on Apr 6

    Is this Larry Kudlow’s blog?

  15. angryinch commented on Apr 6


    Thanks for giving us the Lowe-down.

  16. Jim Bergsten commented on Apr 6

    I blame myself for the “turnaround.”

    I’m short EVERYTHING.

  17. stuart commented on Apr 6

    Two facts that cannot be argued against.

    1. March total jobs gained 70,000 over Feb total
    2. Within that 70K figure, construction jobs accounted for about a 120,000 pickup over Feb.(-61K to 56K)….

    That means all other sectors essentially had a net change of NEGATIVE 50,000 jobs. Thank god for construction. This will be spun positively by wall street but with a rapidly slowing housing market, certainly not a sign of strength for the future labor market.

  18. Robert Coté commented on Apr 6

    Com’on guys. Give our gracious host a break. Clearly Mr. R has recieved “The Memo.” No more trading day appearances on CNBC unless and until he has something good to say. The immortal bard circa 2007: “Friends, traders, bloggers… Lend me your eyeballs. We come to praise the greatest story never told, not to bury it. So let it be with the Economy. The noble Kudlow hath told you the economy was ambitious; If it were so, it was a grievous fault,…


  19. ac commented on Apr 6

    stuart, nothing personally, but who believes the BLS anymore? They are losing cred each time they give out a “report” that is full of BS. I look at ADP for the pure picture and they have done well this quarter. That chick on this site that was boasting the ADP as the truth was sure correct.

  20. lewis commented on Apr 6

    Speaking for myself and Candide, we would like to welcome Barry back into this best of all possible worlds. It is Easter, and miracles can still happen if you just believe (hang in there Ben). Why, after the next election, after the Iraqi miracle and just before the health care miracle, maybe some of the rest of you can join me, Barry, Lereah and Candide in this new dawning of the age of Aquarius.

    “With the right drugs, a trip to Lowe’s can be awesome” – Jim Morrison.

  21. MichaelC commented on Apr 6

    “”Happy Days Are Here Again” was composed by Milton Ager (1893-1979) & Jack Yellen (1892-1991) in 1929, and introduced in October, just prior to the stock market crash which heralded the start of the Great Depression.” – From Marc De Bruyn (emdebe@village.uunet.be) – August 23, 2003 http://globalia.net/donlope/fz/songs/Happy_Days_Are_Here_Again.html

  22. Ricklogic commented on Apr 6

    NEW YORK, April 6 (Reuters) – Dominion Homes Inc. on Friday said first-quarter contracts fell by more than half compared with a year ago, and the company closed on the sales of about 48 percent fewer homes.
    Ohio-based Dominion said new contracts fell 54 percent to 218, compared with 475 a year earlier. The homes were valued at $43.5 million, down from $89.3 million in the first quarter 2006.
    The company closed on the sales of 165 homes during the quarter compared to 315 homes delivered for the same period 2006.
    (c) Reuters 2007. All rights reserved.

    Yea, everything will be just fine.

  23. Lauriston commented on Apr 6

    Reuters didn’t get the White House memo.

    Excellent article, Barry. Machines will be turned on Monday :)

  24. Eclectic commented on Apr 6

    This 180 is of no real significance, standing alone. 2-3 continued months of 180 would be, but that’s the whole thing we can not know.

    What do we know?…. We do know that jobs have grown continuously for several years, and we know that the pace has slowed, but we do not know when, or if, it will reverse.

    If it is in the midst of a reveral, we can not know it until the ADP and BLS are able to demonstrate it within their statistically significant limits, and that can’t happen unless the delta exceeds about 430k in any given month, more-or-less, or exceeds 430k cumulatively during continuous periods.

    According to the cumulative data, jobs are indeed continuing to increase in number… given that we examine all the recent months that have given rise to a net increase of 430k or more.

    Employment is a l-a-g-g-i-n-g indicator. Let me clarify that a tad. The delta in employment that eventually proves the reversal has occurred IS a lagging indicator, and then the worsening employment itself becomes a LEADING indicator of the depths of the subsequent economic downturn. Even its quality of being a leading indicator will evenually subside to then again LAG the again reversing delta.

  25. Michael Carne commented on Apr 6

    Beeks?! Where in the hell is Beeks???

  26. John Hargreaves commented on Apr 6

    Of course the economy turned around on a dime. My wife went shopping again.

  27. tjofpa commented on Apr 6

    Beeks must have gotten to NYC at around 10 am Tues Morning.

  28. dirge commented on Apr 6

    How many jobs are required each month just to keep up with population growth? I had thought that it was somewhere between 100 and 150k. Am I way off?

  29. jagmohan swain commented on Apr 6

    While I have been bearish on the housing market I don’t think we are going to see a precipitous collapse in equity market.I would like that to happen first in bond markets.But the fact of the matter is interest rates remain incredibly low.Earnings aren’t exploding but they are not decelerating either.And as per valuation we are nowhere close to nasdaq 2000.When a bear market starts from an even-valued levels any correction would be muted.So in my opinion there is no need to get all worked up about recession, bear markets etc as these aren’t abrupt events.As things get bad market will give enough opportunity to get out of long side and play on the short side.So long and strong at this corner for now after catching the February sell off on the short side.

  30. Rick Hanley commented on Apr 6

    It’s clear as day that Barry was being sarcastic but for the life of me I can’t understand the comments in 25% of the posts. Are they going along with the sarcasm? Are they adding to the ridicule of some talking head that I don’t know and so I can’t tell that they actually got it?

    Most of us know that the talking heads, if they were working today, would have tried to talk the market into a double (100% gain). They would have cried with joy on the set at the mere thought of such humongous proof (haha ha) of the vigor in the economy. I think that is in their contracts. They also sign away any acceptance/recognition of Nasdaq having dropped almost 80% several years ago. That recognition is only for sad, sad pessimists. It is not a lesson to heed (sarcasm).

    The unwind is going to be a doozie.

  31. daisycolorado commented on Apr 6

    I guess when rational analysis fails you, all that is left to salvage ones ego is sarcasm…. perfectly understandable.

    And BTW AC, I believe the BLS data, knowing the people who put together both the ADP and BLS data, their relative experience, history, motivations and methodologies, I will take BLS any day.

    And yes, employment is a lagging indicator, but hours worked, particularly for manufacturing is a leading indicator and it was up a robust .2 hours.

    Its looking more and more like February was a weather related head fake and not the beginning of some financial melt down after all.

  32. Winston Munn commented on Apr 6

    Was the jobs number signed off by Karl?

  33. Eclectic commented on Apr 6

    daisycolorado, per you:

    “And yes, employment is a lagging indicator, but hours worked, particularly for manufacturing is a leading indicator and it was up a robust .2 hours.”

    You have a good point… and it’s hard to defeat it without attempting to use the proverbial “chicken and egg” argument.

    Increased work-week hours along with increasing wages can go a long way to preserve consumer confidence and spending.

    But, it won’t necessarily induce the capex we need, nor will it necessarily offset losses in consumer confidence and spending that result from housing weakness, the kind of weakness that the jury is really still out about.

    For me personally, nothing changed from minutes before to minutes after BLS. I had a momentary sense that the economy was much stronger, after being exposed to the party hats and “Rose Bowl Parade-like” commentary from CNBC this morning… but after second thoughts, I’m back to a wait and see attitude. Maybe yes… maybe no… my opinion won’t change it, no differently than one kernel of corn will change the size of the corn crop this year.

    I think you’re being short-sighted about ADP. They have a reputation for objectivity and precision. Otherwise, who’d allow them to handle their payroll? However, I agree with you about BLS’s competence… it’s just that they’re two completely different studies.

    I can’t conceive of ADP losing payroll processing customers who’d want to somehow retaliate against them for accurately reporting employment data that affected economic commentary or markets. Payroll is an expense that demands careful attention to efficiency. The more efficient ADP is, the more likely they will keep customers who’d be cutting their noses off to spite their faces if they fired them purely because they blamed them for facts beyond ADP’s control.

    I have no affiliation whatsoever with ADP.

  34. Eclectic commented on Apr 6

    On sarcasm and Barringo:

    Barry’s delivery of the opening topic in written text might more easily be perceived by people who don’t know him as coming from petulance associated with sarcasm, rather than from the ironic form of sarcastic humor (as I think he’s trying to say with his post-scripted definition of sarcasm).

    It takes an incredibly talented writer to convey this subtle difference in writing alone. Strangely enough, Abraham Lincoln could do this as well as any other writer I can think of… with the possible exception of Mark Twain.

    Although a very talented writer, Barringo doesn’t have the time I’m sure to spinkle his text with the literary clues that can make the distinction more clear.

    If you saw him deliver the same elements in the topic headlining text, but rather by doing it in person, verbally, with all the tone, inflection and body language of human communication, you might not even recognize it as being from the same topic text.

    Having said all of that, he’s just being an asshat today, and he needs a cookie and a nap.

    You see… that’s the way to do it. Old Abe didn’t have any monopoly on the artistic form of ironic sarcasm.

  35. Craig commented on Apr 6

    Mr. Eclectic, we TOLD you plainly, Bondie’s temperature cannot remain below 5.25 as long as her petuitary is pumping out growth hormone at about the 12550 level. We explained that we can’t cut the amount of insulinterest at these levels, which may lead to ever higher rates. Look at her chart, that trendline is alarming! If she spikes above 4.90 she’s a gonner for 5.25. We can’t do a thing unless she stops drinking Greenspan’s punch and she goes into rehab. But we have to warn you, this treatment is going to make Britney Spears look like a genius.

    Dr’s Benber N. Anke, Goode, Friday, Solomon, et al.

  36. Winston Munn commented on Apr 6

    Inside the numbers from Economicpolicies.com: “Second, manufacturing employment continued to trend down over the month (-16,000), with declines in furniture and related products (-4,000), computer and electronic products (-4,000), textile mills (-2,000), and paper and paper products (-2,000). Not good.

    Finally, the BLS in March added a magical 128,000 to the number employed with what they call their Birth/Death Model.”

    Ya gotta love that birth/death model.

  37. brion commented on Apr 7

    I’ve been known to dabble as a songwriter and i think i’ve come up with an updated “Happy Days Are Here Again”…It’s called

    “There’s A Light At The End Of The Tunnel”

    Hey DaisyC–Do you HAVE to haunt this blog too? I’d rather go to the propaganda than have the propaganda come to me…know what i mean?

  38. Barry Ritholtz commented on Apr 7

    Humans have a tendency to overemphasize more recent data than overall trend (The recency effect).

    Despite an overwhelming amount of evidence showing that this has been a generally weak jobs recovery (worst post-WWII), your primate brain interpret a modest number as proof of a strong economy.

    Of course, 180k is hardly a strong number relative to both population growth and recent expansions (1990s). Oh, and in the that period, there was no Birth/Death adjustment.

  39. The Big Picture commented on Apr 7

    Liscio Report on NFP

    I mocked yesterday’s NFP report, and a sizably stunning percentage of readers didn’t get the humor (and on a day off, too). My assumption is that these are people who are unfamiliar with my slightly skewed sense of humor. To contextualize that, a few m…

  40. Eclectic commented on Apr 7

    Sorry Craig…

    But, I’m really surprised at you!

    I called up ANKE with your suggestions and he just laughed. He said, “Mr. Eclectic, every clinician worth his caduceus KNOWS that infections with Conclusiarii Ridiculonius n-e-v-e-r lead to increased growth hormone.”

    He reminded me that he’d also heard that once from some hack doctor down in Texas that published a paper in a medical journal, a guy named Dr. F.I. Sher.

    Unfortunately, Dr. Sher came down with a case of Bombastus Hyperbolus from some bad pork at a square dance he was callin’ do-sa-do at, and didn’t return calls.

    Where’d you go to med school anyway???

  41. me commented on Apr 8

    Look, for his entire 8 years job growth under Clinton averaged 236,000 a month. How many times has Bush exceeded that average?

    Even with the birth/death funny numbers? If the jobs are so great, why did 26,000 people apply for 1000 casino jobs, not exactly high paying?

  42. Craig commented on Apr 8

    How dare you Eclectic Sir! I went to medical school for the full two weeks in Mexico. I urge you, keep Bondie below 4.90 or she’ll run to 5.25 for sure.
    The Federali’s won’t cut her med rate while she’s running at this rate and they believe their own lying diagnosis. They won’t add medicine until Bondie’s sister, Dollarie, is really sick too. And the evil triplet, Goldie, she is so hot! She looks to be getting very healthy.

  43. Eclectic commented on Apr 9


    Time to put your big mouth on some specific predictions on the 10-y-T.

    You and Barringo need to huddle up and decide how much foot you want to put in your mouth… and you should be careful, cause you may have to eat up a lot of big foot before last day 2007.

    Come back?

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