This chart comes from The Conference Board, and it shows the relationship between the level of employment (red line) and an index of online help-wanted ads (blue line). Over the relatively short sample period available, ads seem to do a good job of leading employment, which in turn suggests that we should be seeing further job gains in the months ahead.
HT: Mark Perry, who notes that "the 4,296,100 job vacancies in September were the highest level since November 2008, almost two years ago." This is a fairly impressive and positive sign in my view.
This data combined with the American Staffing Association highs
ReplyDeleteportend inprovement in job creation...
I can only surmise that if we do get improvement in job creation as these indicators suggest, then the market is going to be in for a surprise.
ReplyDeleteBoy, I sure hope so.
ReplyDeleteThe Fed wants to take away the punch bowl already.
If online job demand points to rising employment, then online consumption points to recession.
ReplyDeleteAh yes Consumer Metrics Institute......
ReplyDeleteA little off topic but IBM traded at ALL TIME HIGHS today. Yes, exceeding 1998 and 1999, when earnings per share were $3.29 and $3.72 respectively. EPS for 2010 should exceed $11.00 per share. IBM keeps on truckin'.
ReplyDeleteJohn-
ReplyDeleteJust some simple math, but fun.
Okay, lets say EPS climb 50 percent in next five years--not impossible, coming out of a recssion.
Let's say multiples increase by 50 percent in next five years--not impossible, coming out of a recession, and in a low-interst rate environment.
You get Dow 24,000 or so.
Not impossible.
Benj,
ReplyDeleteAssuming a 20X earnings multiple that would be pretty close to correct. Not saying that will happen...just that its possible and not a crazy notion.
The market is not as cheap as it was in late june when everyone thought the euro would implode but it is still reasonably valued in my opinion. It will be interesting to see if we get the correction in October after end-of-quarter window dressing. I still think higher than now by yearend. If employment exceeds expectations during the fourth quarter, as Scott says, it will be a big surprise...and very positive for the markets.
John,
ReplyDeleteWhat exactly does IBM do these days? I haven't the slightest clue...
IBM?
ReplyDeleteI always thought it referred to one's bowel movement.
Pub,
ReplyDeleteSorry, I did not see your question until today.
IBM has remade itself in recent years, transforming itself from a manufacturing company to a services company. They may still have some manufactuting but they are primarily a business services company providing information processing technology and software. They also basicly manage the 'rat's nest' of tech systems. They also do consulting work on thorny problems that face businesses, industries, and governments (see recent TV advertisments..."I'm an IBMer").
Their record of consistent earnings and dividend growth over the years is quite good.
I do not own IBM directly...it is a component of a large cap fund I own, as well as an ETF.