Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

The Elections Are Over - And No One Should Be Happy

My headline sounds like sour grapes from a Romney supporter - NOT.

What every person in the USA should understand is that the economy is as bad as it was a week ago - and the political machine responsible for changing it is the same as one week ago. I am not a dogma driven citizen - and I do not buy the political platforms of the left or right. What I wanted was economic solutions.

Most do not understand that every economy in the world is geared differently. That is why a strong centrally controlled economy can prosper equally as well as a laissez faire economy. Taxes, regulations and government support are balanced for each situation.

The government portion of the USA economy is not in balance for the type of economy that exists. Both political parties have a vision, but not the votes to make the economy function better (ok, both have a plan but neither is good). The country has demonstrated it is divided - and has voted to prevent the necessary change.

Whether the fall in the markets this past week were due to this realization - or because of a variety of other big issues - surely a game plan for redesigning American's fiscal policy is at least 2 years (1 more election cycle) away.

The Econintersect economic forecast for November 2012 showed barely moderate growth, but the underlying data used to forecast was very mixed. To use a technical term - the data was wacky, and as an analyst leaves me with an uncomfortable feeling. However, the good data was stronger than the bad data, and our alternate forecasting tools validated our forecast.

ECRI is still insisting a recession is here (a 07Sep2012 post on their website). ECRI first stated in September 2011 a recession was coming . The size and depth is unknown. The ECRI WLI growth index value is enjoying its eleventh week in positive territory. The index is indicating the economy six month from today will be slightly better than it is today.

Current ECRI WLI Growth Index

/images/z weekly_indexes.PNG

Initial unemployment claims fell slightly - from 363,000 (reported last week) to 355,000 this week. Historically, claims exceeding 400,000 per week usually occur when employment gains are less than the workforce growth, resulting in an increasing unemployment rate (background here and here). The real gauge - the 4 week moving average - rose slightly from 367,250 (reported last week) to 370,500. Because of the noise (week-to-week movements from abnormal events AND the backward revisions to previous weeks releases), the 4-week average remains the reliable gauge.

Weekly Initial Unemployment Claims - 4 Week Average - Seasonally Adjusted - 2010 (blue line), 2011 (red line), 2012 (green line)

/images/z unemployment.PNG

Bankruptcies this Week: Homer City Funding, Privately-held American Suzuki Motor, Monitor Company Group Limited Partnership

Data released this week which contained economically intuitive components (forward looking) were:

  • Rail movements (where the economic intuitive components indicate a moderately slightly expanding economy).
  • ISM Services business activities subindex weakened but remains in expansion territory. There is no clear trend.
  • The imports portion of the trade balance was very bad (YoY decline). This is not a good indicator.

All other data released this week either does not have enough historical correlation to the economy to be considered intuitive, or is simply a coincident indicator to the economy.

Weekly Economic Release Scorecard:
Dollar Gains on European Woes
Philly Fed: Economic Forecasters See Little Change in Outlook for 4Q2012
Preliminary November 2012 Michigan Consumer Sentiment at Post Recession High
ECRI's Weekly Leading Index Growth Index Rate Falls in w/e 02 November 2012
September 2012 Wholesale Sales & Inventories Shows Recessionary Signs
Slight Export and Import Price Inflation in October 2012
Infographic of the Day: @Work State of Mind
How to Handle Futures Contract Rollovers
Built to Last: Structure and Conscience
China: CPI Lower than Expected, PPI Contraction Continues
CBO: Possible Changes for a Sustainable USA Budgetary Path
Fed's Balance Sheet: 07 November 2012: Hardly Any Change
Options for Falling Off the Fiscal Cliff
Rail Week Ending 03 November 2012: Bad Hair Week Due to Hurricane Sandy
Did France Cut Wages to Offset Tax Increases?
Stock Market Harmonics: Signaling the Unexpected
03 November 2012 Unemployment Claims: Four Week Average Up Again
September 2012 Trade Data: Does Not Look Pretty
The Employment and GDP Relationship
Infographic of the Day: Car Theft Hotspots
Value vs. Momentum
The State of Economics During the Crisis
Gold Consolidation Formation Faces Important Test
Challenger CEO Turnover Jumps in October 2012
New Index From Chicago Fed To Forecast Recessions
Employment Loss During Great Depression May Be 4.3 Million too High
Consumer Credit Driven by Student Loans in September 2012
Obama Gets a Mulligan
China: Reform May Not Be Coming
Valuation Call: Bank of America and AIG
Stratfor: Elections, Gridlock and Foreign Policy
Infographic of the Day: Mortgage Payment Options
Chronic Fatigue Syndrome is No Joke
Avoiding the Whipsaw Trap
September 2012 CoreLogic Home Prices Show Continuing Year-over-Year Improvement
Shocker!!!!! Supreme Court Disqualifies Millions of Votes
Avoiding Post-Election Options Volatility Crush
September 2012 JOLTS May Be Warning of Slowing Job Gains Ahead
Infographic of the Day: Smartphone Security Risks
Bulls Return to Ticker Sense 05 November 2012 Blogger Sentiment
Markets Will Let You Know To Be Long or Short
Sandy and Election Day Blues
Netherlands: Real Estate Bubble Pops, Trouble for Banks
Goldman to SCOTUS: Save Wall Street
For A Large Segment of Population - Renting A Home Better Than Buying
Average Gasoline Price Falls $0.075 Week Ending 05 November 2012
Geopolitics, Trigger of a Big New Global Shock?
Monster: U.S. and Europe Employment Headed in Different Directions
Cycle Low Opportunity for Gold?
Found: The Voters Who Will Decide the Election
ISM Services Index Is Softer in October 2012
October 2012 Employment Index Grows but Forecasts Weak Growth
Infographic of the Day: QE3 and the Real Estate Market
Why Are There No Famous Financial Whistleblowers in This Crisis?
Why Oil Prices Can't (and Won't) Collapse
The Week That Was Stormy
The Fiscal Cliff and Corporate Profits
Insider Trading 02 November 2012: Bill Gates Sold $153 Million of Microsoft
Sunday Economic Comedy: Economic Scream Therapy
Infographic of the Day: World's Largest Tech Companies
Full-Time Jobs Jump But….
Car of the Year: Tesla Model S
Saturday Economics Comedy: Live at Lancaster University
Infographic of the Day: Social Media Destroys Productivity
Mosler Book Free This Weekend Only
The Goods on Imports - A Growing Problem?
Crib Sheet for the Undecided Voter
Media Negative on Presidential Election
ECRI's Weekly Leading Index Growth Index Rate Slightly Falls in w/e 26 October 2012
Manufacturing New Orders Remain Soft in September 2012

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.