John Lounsbury's  Instablog

I always thought that seasonal adjustment should wash out when comparing twelve month changes.  In other words, seasonal adjustment should contain only calendar effects.  When comparing one month to the same month a year earlier the changes for SA (seasonally adjusted) data and for NSA (not seasonally adjusted) data should be the same.

Well, it doesn't happen.  Look at the data from the NAR (National Association of Realtors) for existing home sales in the following two tables.





Why aren't the percent changes from October 2008 to October 2009 the same for SA and NSA?

Seasonal adjustment appears to have added 32.9% to the single home sales (2.4 / 7.3) and 19.7% to the condo sales (6.7 / 34.1).  Seasonal adjustment is not the same for every October? 

Sources:  here and here. 

Read Gillian Tett's article with this title at ft.com (here).

In case you missed it on Market Currents (Sunday evening), Janet Tavakoli has retracted (here) her apology to Goldman Sachs (GS) of two weeks ago.  She apologized for accusing Goldman of lying when they said that the AIG bailout was immaterial to their financial well being.  Scratch that!  She cites the report released Wednesday by SIGTARP (here).

Has The New York Times editorial board been reading comment streams on Seeking Alpha?  In today's editorial (here), they suggest that, rather than the $100 million a year for five years devoted to small business (details here), Goldman Sachs (GS) should be paying billions per year against the national debt.

In this week's Thoughts From the Frontline newsletter by John Mauldin, the following graph shows the 47-year history of the dollar index.  The title of this week's piece is "Where the Wild Things Are" and it will probably appear on Seeking Alpha in the next day or two.  When it does, read the article to get John's perspective.  Note:  I have added the black support lines.



The message I take from this is that the dollar is continuing a very slight down sloping trend since 1980.  The crash of the dollar is feared; it is not here yet.  The types of fluctuations in the dollar index we have seen in the past two years are quite typical.  The two wide swings occurred with peaks in 1985 and 2002.

Now, the behavior of all currencies relative to gold, oil and some commodities is quite another story.

Go to http://vimeo.com/6437816 to see a really cool animated history lesson by Pedro M. Cruz.

Hat tip to Paul Kedrosky at Infectious Greed (here).