So much for that economic forecast

[MU Fan in Connecticut]

Here's a sampling of April metals pricing for a few metals.  This is from the London Metal's Exchange (LME).  It's available for free if you register.  They have the monthly averages going back to January 2021.  Further back data is also available somewhere on the site.

Nickel has been screwed up because of Russia invading Ukraine.  I took a closer look and it actually leveled off some at the end of the month.  We separate the Fabrication Price + Metal Price = Sales Price for most customers.  Fab price (that's our cost to make) and we increase/decrease the metal portion depending on international monthly averages.  Some of our customers use COMEX which is another international metals trading site.  So we don't get penalized for increases in raw material and our customer's benefit when international prices drop.   

https://www.lme.com/en/Market-data/Reports-and-data/Monthly-averages

[MU82]

Job openings hit new records, while 4.5 million Americans quit or changed jobs in March, reflecting labor market strength

https://www.washingtonpost.com/business/2022/05/03/jobs-quits-hires-march-2022/?utm_campaign=wp_post_most&utm_medium=email&utm_source=newsletter&wpisrc=nl_most&carta-url=https%3A%2F%2Fs2.washingtonpost.com%2Fcar-ln-tr%2F36bd879%2F6271551e956121755a613f47%2F5f8d147cae7e8a56e5b732a4%2F15%2F72%2F6271551e956121755a613f47

U.S. employers posted a record 11.5 million job openings in March, and some 4.5 million Americans quit or changed positions, matching previous highs, reflecting continued strength in the rapidly growing labor market, where workers continue to have the upper hand.

Meanwhile, the number of new hires — 6.7 million — remained steady, according to a report released Tuesday by the Bureau of Labor Statistics.

“Demand for workers remains white-hot,” said Julia Pollak, chief economist at ZipRecruiter. “This is very broad, enormous growth. Even though we’ve almost recovered all of the jobs lost in the pandemic, the labor market just keeps getting tighter and tighter.”

The strong job openings and worker quits data could play into discussions about curbing inflation at the Federal Reserve, which is expected to announce another interest rate hike, by a half-percentage point on Wednesday. Fed Chair Jerome H. Powell has cited the “extremely, historically” tight job market as a major reason he says the economy can withstand higher interest rates without tumbling into recession.

U.S. employers have added more than 400,000 jobs a month for nearly a year, while the unemployment rate of 3.6 percent remains near record lows. Overall, the number of job openings grew 36 percent in March from a year earlier. Demand for workers rose markedly in retail (where job openings increased by 155,000 from February), manufacturing (up 75,000) and finance and insurance (up 51,000).

That insatiable need for new workers has forced employers across the economy to offer higher pay and better benefits. Wages have risen 4.7 percent in the past year, although they have not kept up with inflation, which has grown 8.5 percent in the same period. Economists say they expect workers’ pay to continue ticking up in coming months as companies compete for a limited pool of workers.

“These record quits across the economy show that employers are under huge pressure,” Pollak said. “They’re going to realize very quickly that offering massive compensation packages to new hires isn’t going to cut it anymore. They’re going to have to raise wages wholesale for existing employees, too.”

Workers who switched jobs saw a 5.3 percent increase in median pay from a year ago, compared to 4 percent growth for those who stayed put, according to the Federal Reserve Bank of Atlanta’s Wage Growth Tracker.

“The balance of power in wage negotiations has tilted toward workers,” Mickey Levy, chief Americas economist for Berenberg Capital Markets, wrote in a client note Tuesday.

[muwarrior69]

Job openings hit new records, while 4.5 million Americans quit or changed jobs in March, reflecting labor market strength

https://www.washingtonpost.com/business/2022/05/03/jobs-quits-hires-march-2022/?utm_campaign=wp_post_most&utm_medium=email&utm_source=newsletter&wpisrc=nl_most&carta-url=https%3A%2F%2Fs2.washingtonpost.com%2Fcar-ln-tr%2F36bd879%2F6271551e956121755a613f47%2F5f8d147cae7e8a56e5b732a4%2F15%2F72%2F6271551e956121755a613f47

U.S. employers posted a record 11.5 million job openings in March, and some 4.5 million Americans quit or changed positions, matching previous highs, reflecting continued strength in the rapidly growing labor market, where workers continue to have the upper hand.

Meanwhile, the number of new hires — 6.7 million — remained steady, according to a report released Tuesday by the Bureau of Labor Statistics.

“Demand for workers remains white-hot,” said Julia Pollak, chief economist at ZipRecruiter. “This is very broad, enormous growth. Even though we’ve almost recovered all of the jobs lost in the pandemic, the labor market just keeps getting tighter and tighter.”

The strong job openings and worker quits data could play into discussions about curbing inflation at the Federal Reserve, which is expected to announce another interest rate hike, by a half-percentage point on Wednesday. Fed Chair Jerome H. Powell has cited the “extremely, historically” tight job market as a major reason he says the economy can withstand higher interest rates without tumbling into recession.

U.S. employers have added more than 400,000 jobs a month for nearly a year, while the unemployment rate of 3.6 percent remains near record lows. Overall, the number of job openings grew 36 percent in March from a year earlier. Demand for workers rose markedly in retail (where job openings increased by 155,000 from February), manufacturing (up 75,000) and finance and insurance (up 51,000).

That insatiable need for new workers has forced employers across the economy to offer higher pay and better benefits. Wages have risen 4.7 percent in the past year, although they have not kept up with inflation, which has grown 8.5 percent in the same period. Economists say they expect workers’ pay to continue ticking up in coming months as companies compete for a limited pool of workers.

“These record quits across the economy show that employers are under huge pressure,” Pollak said. “They’re going to realize very quickly that offering massive compensation packages to new hires isn’t going to cut it anymore. They’re going to have to raise wages wholesale for existing employees, too.”

Workers who switched jobs saw a 5.3 percent increase in median pay from a year ago, compared to 4 percent growth for those who stayed put, according to the Federal Reserve Bank of Atlanta’s Wage Growth Tracker.

“The balance of power in wage negotiations has tilted toward workers,” Mickey Levy, chief Americas economist for Berenberg Capital Markets, wrote in a client note Tuesday.

Yet the job participation rate continues to fall. Inflation will not come down until energy costs come down as that affects the cost of just about everything. We just installed solar panels on our roof not to save the planet but to save money.


https://www.bls.gov/opub/mlr/2013/article/labor-force-projections-to-2022-the-labor-force-participation-rate-continues-to-fall.htm

[Uncle Rico]

Yet the job participation rate continues to fall. Inflation will not come down until energy costs come down as that affects the cost of just about everything. We just installed solar panels on our roof not to save the planet but to save money.


https://www.bls.gov/opub/mlr/2013/article/labor-force-projections-to-2022-the-labor-force-participation-rate-continues-to-fall.htm

I don’t do a single thing to leave the world a better place I found it.  There is no I in Earth but there is an e for me

[Herman Cain]

82

I also took away from the Buffett meeting that he and Munger felt that speculation inflated the market over the past couple of years. His comments on giving guidance were also interested, IMO. I watched 90% of the event and did not come away feeling we are in a robust economic cycle. I very much enjoyed watching the meeting and hope the old guys are back next year.

Goose:
I thought you would enjoy this story.

Many years ago, when I was young Investment Banker in the pre internet and cell phone age ; I was dispatched by my client to make an offer to Berkshire to sell their business . This was in Buffetts early days of entire business acquisitions .

So I proceeded to write Mr. Buffett a letter in accordance with the guidelines he requested for acquisitions along these lines
Dear Mr . Buffett:
I am writing to you about XYZ corporation . Discussion of its deep moat
Characteristics . Discussion of the group I Represented . Then an asking price. I look forward to your response .
Sincerely,
Herman Cain

I at at my desk waiting for a call. instead ,about 3 Weeks later I received a letter from Buffett along these lines .

Dear Herman: ( I liked that personalization Lol)

You are correct XYZ is exactly the type of business Berkshire wants to acquire .

I have personally read every XYZ annual report for the last 28 years cover to cover including footnotes .

I am not interested at the price offered . However , please continue to send any other opportunities you may see .

Best Regards.

Sincerely,
Warren E. Buffett

Fast Forward to today about 28 years later . Berkshire bought XYZ for about 60 times what is was offered back in the day .

All my files are in storage since we moved to the Sunshine State . One day I am going to dig that letter out and frame it next to a copy of the Wall Street Journal story announcing Berkshires acquisition of XYZ

As far as I am concerned Buffett has lost nothing off his fastball . He is  Still a Tiger out there .

[Goose]

Herman,

That is a great story. Back in my leather/shoe days I wrote, but never sent Warren Buffet a letter about the opportunities in China and the shoe industry in particular. I remember vividly sitting in my hotel room in approx 1995 and saying to myself this is the next gold rush and I thought Buffet was the perfect guy to invest in the excitement being created in China. To this day I still regret not sending him that letter.

Fast forward from my non sent letter and Berkshire started buying shoe companies in the late 1990's and ultimately bought Dexter Shoe from Harold Alfond and his family. I had the pleasure of seeing Mr. Alfond at work and worked a great deal with two of his grandsons and his son in law over the years. It was a lesson in business I have never forgot.


By the way, Buffet said later on that buying Dexter was the worst deal he ever made, compounded by the deal being stock vs. cash. Even the the great one's can be a pigeon from time to time.
As for the Dexter sale to Berkshire, Mr. Alfond was closing the deal with Buffet and it was to be an all cash deal, which was the norm for Buffet and Berkshire. Mr. Alfond politely told Buffet that he had plenty of cash and he only would sell for Berkshire stock. He ultimately sold for stock and one of my business hero's, Alfond, beat one of my other hero's in that deal.

I would recommend anyone that has an interest in business, manufacturing and how to run a family business to google Harold Alfond. An amazing man and a better businessman. As I mentioned, I saw Mr. Alfond in action on more than one occasion and it was a lesson that was beyond belief. For one morning I shadowed Mr. Alfond as he went department to department to talk to the managers and piece work employees to get a pulse on how things were going in the company. In addition, he checked every daily piece work time sheet to make sure production was moving at the proper speed. He was firm, polite, funny and caring, but he definitely had an agenda for his time on the floor and it was priceless to be a small part of his morning.

[MU Fan in Connecticut]

Herman,

That is a great story. Back in my leather/shoe days I wrote, but never sent Warren Buffet a letter about the opportunities in China and the shoe industry in particular. I remember vividly sitting in my hotel room in approx 1995 and saying to myself this is the next gold rush and I thought Buffet was the perfect guy to invest in the excitement being created in China. To this day I still regret not sending him that letter.

Fast forward from my non sent letter and Berkshire started buying shoe companies in the late 1990's and ultimately bought Dexter Shoe from Harold Alfond and his family. I had the pleasure of seeing Mr. Alfond at work and worked a great deal with two of his grandsons and his son in law over the years. It was a lesson in business I have never forgot.


By the way, Buffet said later on that buying Dexter was the worst deal he ever made, compounded by the deal being stock vs. cash. Even the the great one's can be a pigeon from time to time.
As for the Dexter sale to Berkshire, Mr. Alfond was closing the deal with Buffet and it was to be an all cash deal, which was the norm for Buffet and Berkshire. Mr. Alfond politely told Buffet that he had plenty of cash and he only would sell for Berkshire stock. He ultimately sold for stock and one of my business hero's, Alfond, beat one of my other hero's in that deal.

I would recommend anyone that has an interest in business, manufacturing and how to run a family business to google Harold Alfond. An amazing man and a better businessman. As I mentioned, I saw Mr. Alfond in action on more than one occasion and it was a lesson that was beyond belief. For one morning I shadowed Mr. Alfond as he went department to department to talk to the managers and piece work employees to get a pulse on how things were going in the company. In addition, he checked every daily piece work time sheet to make sure production was moving at the proper speed. He was firm, polite, funny and caring, but he definitely had an agenda for his time on the floor and it was priceless to be a small part of his morning.

Goose,
Taking me back to my childhood.  On my French-Canadian side I had a Great Uncle who lived in Dover-Foxcroft, ME.  We'd go up to visit over the summer and as part of the trip was my parents insistence that we always stop at the nearby Dexter Shoe Factory and pick up shoes at a discount.   

[Goose]

Mu Fan

Aside from my time with the Alfond and Lunder family at Dexter, the highlight of my time in Dexter ME was hanging out at the off track betting joint in town. I love Maine, but Dexter was not much to write home about back in the day.

By the way, I became friends with Alfond's grandson the first time I met him and told him I would never wear a pair of Dexter shoes and he loved it. That is how I made my debut to the Alfond family.

[MU82]

U.S. Jobs Report for April Shows More Strong Gains

https://www.nytimes.com/live/2022/05/06/business/april-2022-jobs-report?campaign_id=60&emc=edit_na_20220506&instance_id=0&nl=breaking-news&ref=headline&regi_id=108420427&segment_id=91458&user_id=d36dcf821462fdd16ec3636710a855fa

April produced another solid month of job growth, the Labor Department reported Friday, reflecting the economy’s resilient rebound from the pandemic’s devastation.

U.S. employers added 428,000 jobs, the department said, the same as the revised figure for March. The unemployment rate in April remained 3.6 percent.

“The job market is proving to be a key source of resilience for the economy. Job creation will eventually settle into a slower pace as businesses feel the pinch of soaring inflation and tighter financial conditions, but gains will stay healthy,” said Oren Klachkin, a lead U.S. economist at Oxford Economics. “We think the economy has enough strength to create over 4 million jobs this year.”

The U.S. economy has regained more than 90 percent of the 22 million jobs lost at the height of coronavirus-related lockdowns in the spring of 2020. And labor force participation has recovered more swiftly than most analysts initially expected, nearing prepandemic levels. The labor supply over the past year has not kept up with a record wave of job openings, however, as businesses expand to meet the demand for a variety of goods and services.

That has helped push up wages — the April survey showed average hourly earnings 5.5 percent higher than a year earlier — but those gains for workers have been largely offset by a surge in prices.

High inflation began last spring as demand from households and businesses collided with a chaotic reordering of the supply of goods and labor, and it has persisted longer than the Federal Reserve expected. The price pressures have been compounded by the war in Ukraine, which has upended energy and commodity markets, and another spell of coronavirus lockdowns in China, which has caused renewed supply chain disruptions.

[Golden Avalanche]

Huh.

No wonder the grave dancers are presently quiet.

[Goose]

82

The jobs numbers looked very good, but we are living in strange times. IMO, the only numbers that really matter at the moment are inflation numbers and interest rates. My guess is you could find economists who could argue both sides of the job numbers and both could be right. My level of concern is growing weekly, and I believe extremely rough sledding is coming for the US economy.

There was a debate on scoop over the past few days on what caused the rapid increase in inflation, and I believe the biggest single factor was the wealth factor created by an overbought stock market and even hotter housing market. The wealth factor is a dangerous component in our economy because when it dies, it dies hard and fast. If I am right, the good news that weaker demand will drive down prices to some extent.

[MU82]

82

The jobs numbers looked very good, but we are living in strange times. IMO, the only numbers that really matter at the moment are inflation numbers and interest rates. My guess is you could find economists who could argue both sides of the job numbers and both could be right. My level of concern is growing weekly, and I believe extremely rough sledding is coming for the US economy.

There was a debate on scoop over the past few days on what caused the rapid increase in inflation, and I believe the biggest single factor was the wealth factor created by an overbought stock market and even hotter housing market. The wealth factor is a dangerous component in our economy because when it dies, it dies hard and fast. If I am right, the good news that weaker demand will drive down prices to some extent.

Yep. Indeed, I have read accounts from some economists this morning that say it actually would have been good if job growth and wages would cool some because it would help tamp down inflation.

There are plenty of concerns to go around.

[4everwarriors]

Published numbers lag real time scenarios. In today's economic volatility, stick a wet finger in the air and gage how the wind is blowin'.
In fact, stick a long finger in da direction of 1600 Pennsylvania Ave., aina?

[Hards Alumni]

Published numbers lag real time scenarios. In today's economic volatility, stick a wet finger in the air and gage how the wind is blowin'.
In fact, stick a long finger in da direction of 1600 Pennsylvania Ave., aina?

 

[MUBurrow]

82

The jobs numbers looked very good, but we are living in strange times. IMO, the only numbers that really matter at the moment are inflation numbers and interest rates. My guess is you could find economists who could argue both sides of the job numbers and both could be right. My level of concern is growing weekly, and I believe extremely rough sledding is coming for the US economy.

There was a debate on scoop over the past few days on what caused the rapid increase in inflation, and I believe the biggest single factor was the wealth factor created by an overbought stock market and even hotter housing market. The wealth factor is a dangerous component in our economy because when it dies, it dies hard and fast. If I am right, the good news that weaker demand will drive down prices to some extent.

Goose, could you elaborate a bit on why you think raising interest rates might be the wrong strategy?  I don't have the experience through as many economic cycles as you and some others here.  From my limited experience, the Fed raising rates seems like a no brainer - an overjuiced equity market, unsustainable residential real estate market, inflation that is too high, rates that are (long view historically) very low - it seems like capital is very, very available.  I'm kind of scratching my head saying "if not a rate raise now, then when would rates ever go up?"

[Hards Alumni]

Goose, could you elaborate a bit on why you think raising interest rates might be the wrong strategy?  I don't have the experience through as many economic cycles as you and some others here.  From my limited experience, the Fed raising rates seems like a no brainer - an overjuiced equity market, unsustainable residential real estate market, inflation that is too high, rates that are (long view historically) very low - it seems like capital is very, very available.  I'm kind of scratching my head saying "if not a rate raise now, then when would rates ever go up?"

IMO, it's well past time to raise rates.  Doing so allows a lever to be pulled in the future to stimulate the economy.

[MUBurrow]

IMO, it's well past time to raise rates.  Doing so allows a lever to be pulled in the future to stimulate the economy.

That's my thinking too. I'm pretty afraid that we're running out of bullets in the chamber that we can fire during economic swoons.

[Goose]

MU Burrow

Sorry for not being clear on the interest rate front. I am 10000% in favor of raising rates, believe it should have started in Q3 of 2021 and keep raising them until it is no longer needed. We have had Fed fueled stock market gold rush and equally hot housing market and nothing lasts forever. The Fed is not around to help my retirement plan skyrocket in price or provide 100% increase in my home value. They are a very powerful group, maybe as powerful as any group in the world, and I think they have been reckless for a long time. In addition, they have had interest rates at near zero for a long time and could not to create 2% annualize inflation when they tried to, thus I am not so sure they are going to be able to get the horse back in the barn without a lot of pain to the American public.

[TSmith34, Inc.]

Paranoid conspiracy theories are apparently common amongst old, easily influenced dentists

[rocket surgeon]

Paranoid conspiracy theories are apparently common amongst old, easily influenced dentists

so that's your excuse

[The Hippie Satan of Hyperbole]

so that's your excuse

He’s a dentist?

[real chili 83]

He’s a dentist?

Checkout this Brainiac’s gene pool. TSmiff, that is.

[TSmith34, Inc.]

He’s a dentist?

I seem to know more about health care than roqqet and 4ever, does that count as being a "dentist"?

[4everwarriors]

Maybe bye osmosis, hey?

[rocket surgeon]

I seem to know more about health care than roqqet and 4ever, does that count as being a "dentist"?

  if you can beat about 80 years combined dental experience, then yes, you are a health care rock star smith