The interesting — and high (0.86) — correlation between the “Poor Sales” component of the NFIB’s SBET and the nation’s unemployment rate was evident yet again this month: Last week we saw the unemployment rate drop a dramatic 0.4 percentage points (although the noise and cross-currents in the report were sufficient to render it virtually useless), and today we witnessed the NFIB’s “Poor Sales” component drop a sharp 6 points from last month, from 33 down to 27, the lowest reading for this metric since December 2008, and among the largest drops on record. Although the NFIB’s report was a mixed bag, there were some positive takeaways (the overall index increased (94.1), and the aforementioned decline in Poor Sales as the single biggest problem, among others).
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Previous large declines in Poor Sales took place in Feb 1995 (-9, from 16 to 7, as concerns about Taxes and Insurance rose), and the tail end of 1994 (-6, from 14 down to 8, as worries about Taxes and Regulations rose).
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