Gasoline Prices Soaring Again

By DataAnalytics

Monthly Gasoline prices SPIKE one more time.

Now $3.65 per gallon (2/24). THAT’S THREE DOLLARS SIXTY FIVE CENTS.
Up $0.08 cents within the week. So far gas has RISEN from $3.23 to $3.65
per gallon just since January.

 

(2/20)
The average pump price of regular gasoline in the U.S. has
now risen to $3.57 from a month ago at $3.385 p/gal., and
up from $3.171 p/gal., just a year ago. A hefty 12.6% rise.

 

Here is what the main stream media, the Street and the
department of energy are reporting:

Both Brent and WTI are trading well above $100 per Barrel.

  

The burning question is why.

Here are the corporate owned media ‘talking-points’:

• Geo-political tensions
• Possibility of supply interruptions
• Decreased crude supply from Nigeria and Libya.
• Decreased capacity from Cushing/Midwestern refinery’s

In turn, this is what investment firms and traders use as
a so-called “inflection point” or “trigger” to artificially drive
prices up, of both crude oil and retail gasoline.

However, here are a number of facts uncovered by DataAnalytics.

Most of the previously lost Libyan production is back to
over 1 billion barrels per day.

Nigerian production of 2+ bb/per day has been relatively
stable for the 15 months.

The supposed Geo-political issues in the middle east have been
on-going for the past 40+ years. This is nothing new.

The prospect of supply being disrupted is slight.

U.S. Gasoline demand is at its lowest in 17 years.

• The level of supply is elevated
• The level of demand has decreased

Gasoline supply has increased 9.7% from January.
Refinery utilization has declined from 85.6% to 84%
per day or only 0.4% which equates to -218K per day.
(this is basically a negligible amount)

Other than geo-political rhetoric and wild, unregulated
speculation, the mostly normal and broadly acceptable model
of demand and supply, based on consumption, appears to have
no place in the current price  ‘controls’ established by Wall Street,
OPEC and supposed government regulations.

The fact is that the current and wild speculation is unfounded
and is in the process of creating a gasoline bubble. Just last week,
traders bought 90 billion barrels of futures contracts for themselves.

A major consequence of course is increased consumer inflation
and the further erosion of discretionary income and spending.

The most perilous potential result could be a Double-Dip Recession.
The bottom line is that the average consumer will suffer the
most, while only a very select will benefit and benefit enormously.

When supply is up and demand is down, but prices keep rising,
it does not take a PhD to figure out the causation. Which is
neither one of a geo-political, mechanical or physical supply issue.
In short, it is simply the underlying ambition of unreasonable profit,
by baseless speculation, at the great expense of the consuming public.

We are working on a more in-depth story regarding crude oil
and gasoline commodities. Stay tuned.

Preliminary February Unemployment Rate

By DataAnalytics

U3 rate jumps back up to 9%

Gallup’s latest report suggests the BLS will “likely report on the first
Friday of March that its seasonally adjusted unemployment
rate increased in February.”

Gallup’s mid-month unemployment rate analysis is a preliminary
estimate of the BLS government report. Data now suggests that the
Bureau of Labor Statistics will likely report on March 2nd that its
“Seasonally Adjusted” U3 unemployment rate will indeed actually
INCREASE  in February.

Meanwhile, the U6 rate (underemployment/unemployment) has also
spiked up to 19%, from the purported S.A. 15.7%  rate. The take away
here is that the labor market is worsening as we have suggested.

The non-seasonally adjusted data can be a more effective gauge of
the labor markets overall health. That, and the “Mean Duration” of
unemployment, which is near 41 weeks, accompanied by the all
alarming statistic of 43% of those who are unemployed are in that
Long-Term Unemployment category.

Labor Force Participation Rate is the key to deciphering and analyzing
the realistic unemployment rates. From approximately 2000 to 2009,
the LFPR had been about 67% +/-. But in the past 2+ years the LFPR
has been falling and now stands at approximately 64%+/-.

The reality is that the true total underemployment/unemployment
rate could be as high as 36%. Though it is difficult to pin down exact
numbers without having access to payroll income tax data.

But it is safe to state, that the total unemployment rate is roughly
between 25% and 36%. That is One Quarter to One Third of ALL
available would-be workers out of full-time work or out of work all together.

What this latest batch of data suggests, proves, is that the false claims
and bell-ringing of an economic recovery are worthless. The “Hopium”
that is being passed around in the “progressive pipe” has burned a hole
in the brains of those who are buying-in to the massive propaganda
war being waged by the government and the corporate owned media.

The economy is tanking day by day. All of the meaningful economic
indicators are either flat or negative. We have gone over them time and
time again in the last year, but it doesn’t seem to sink in.

Real Retail Sales were 0.0% in December. Preliminary figures
for January were 0.4%,  which will be revised downward again.
Most big name retailers are in serious trouble.

Profit margins in 2011 were down for almost every major retailer.
Many are now in bankruptcy, due to the massive price slashing
efforts in order to gain the foot traffic in the last quarter of 2011.

Auto sales were misleading as well, as the bulk of orders were not
for customers, but rather dealership inventories.

Crude oil are gasoline are spiraling out of control and have seen
double-digit percentage increases over last year at this time. These
rising fuel commodities show no signs of slowing down or reducing
which is further jeopardizing the economy.

Food prices are up and slightly rising as well and are expected to
remain at elevated levels in 2012. Another cold harsh reality is that
Food & Fuel inflation is up approximately 30%+/- from a year ago.

Housing market remains depressed with median prices still falling,
due in part to the huge inventory of distressed properties. With more
foreclosures due to hit the market all throughout 2012, prices will
continue to slide. This will negatively affect existing homes and
mortgage holders who are already underwater.

Debt, both personal and corporate were up in 2011 and will not
abate anytime soon.

GDP for Q4 2011, was 2.8%. Now, strip out the stockpiled inventories
which accounted for 1.9%, then remove autos, 0.6% and ta-da!
Q4 GDP was a Whopping 0.3%! Zero point three of a percent.

There you have it, 5 major indicators of economic activity are flat to
negative and are nowhere near improving because of one simple word:
Jobs. The labor market is the crux of our economic engine, period.

It’s not the stock market or any other insignificant indicator the media
and shill economists tout. Without sufficient labor levels and wages, the
all important Purchasing Power is diminished or completely eliminated.
Which tends to halt almost all economic activity (except necessities)
in our +/-67 percent  “consumption-driven” economy.
(is the light bulb coming on yet?)

The (In) Complete Postal Package

By DataAnalytics

Neither snow, sleet or rain can usually stop postal carriers from
delivering the U.S. mail, but critical financial difficulties certainly could.

Now staring straight down the barrel of a projected 18.2 BILLION
dollar loss, the United States Postal Service is seeking approval
to increase the price of a first-class stamp to $0.50 cents, up from
the current $0.45, to try and stave off the inevitable bail out.

Suffering from internal inorganization and fairly inefficient operational
methods with some very antiquated and restrictive governmental
regulations, first-class mail volume has fallen 20% since its peak in
2006 along with a 22% decline in overall mail handling volume since 2007.

usps financial chart

A key measure shown in the chart above, is the total expense column.
As revenues fell expenses significantly increased, which only serves
to highlight the ongoing inefficiencies within the postal service.
Particularly alarming are the large jumps in the expenses to revenues
from 2009 to 2011.

E-R Spread

Revenue to Expense mean loss 2006-2011:

• -$4.28 billion

Aggregate revenue loss 2006-2011:

• -$5.1 billion

Year-over-Year mean debt 2006-2011:

• -$2.42 billion

Increase of debt 2006-2011:

• 83%

While these deficiencies certainly contribute to the continual losses,
it is also partly due from not adapting very well to the more recent
electronic and techno media revolution. The resulting drop off in usage
from 2009-2008 had netted a minus $7 billion dollar drop in revenue.

bill-payment graph

Couple these inefficiencies with over paid management, often
problematic unions and so forth and one can see why the post office
is one of the more mismanaged quasi-governmental agencies in the U.S.
It is public knowledge that the postal service has been running huge
deficits for many years now and its viability is in serious question.

In addition to the stamp rate hike, the USPS will be taking further steps
to reduce the massive short-fall of income. This would include cutting
approximately 150k jobs, ending Saturday service and closing up
to 3,500 facilities.

The suggestion of a fully privatized postal system has been brought up
more than ever over the past few years and now in more recent months
and rightly so. But question remains, will the price hikes and cuts be
effective enough to ensure the longevity and sustainability of the postal
service as it exists, without tax-payer intervention…

Gasoline Prices

By DataAnalytics

UPDATED Post:
February 14, 2012

The mean price per gallon for regular gasoline in the U.S. is now $3.51.
Up 12.5% from one year ago, when prices averaged $3.12 per gallon.
Just a month ago, regular was averaging $3.44 p/gal.
This continual rapid rise is cause for alarm and concern as unemployment
is increasing and the economy is falling deeper towards a double-dip recession.

Feb. 2, 2012
Here’s a quick update on U.S. Fuel Commodity Inflation, part of the
necessary and reoccurring household consuming expenditures.

Unless you have been inducted into the witness protection program or
hiding out in a remote secluded cabin…you know that gas prices at the
pump have been (recently) steadily rising since late November.

 

 

In the week ending January 31st, the national average for regular
gasoline was $3.439 per gallon. Up from $3.101 p/g one year ago.
That’s a 10.89% increase and a 4.5% rise just in the month of January.

 

The immediate question is; why? Well of course the most simplistic
and obvious answer would be supply and demand, right? Absolutely,
that would be the correct answer- except that demand for pump gasoline
has been dropping for about the past 3 months.

Demand for pump gasoline during most of 2011 had been approximately
370-million gallons per day, but over the last few months that rate has
fallen to about an average of 340-million gallons per day.

Meanwhile on the supply side, gasoline inventory has increased for the
third straight week, attaining the highest level since March of 2011.
And, with the stockpile of fuel, refinery utilization rate is down by 1.9%.

Typically, U.S. gasoline consumption has historically trended in-step with
employment and with Unemployment at unprecedented highs, the drop-off
in aggregate demand is really no surprise at all.

So the evidence reveals that demand has and continues to decrease, yet
prices at the pump keep rising. Given these two facts, we can surmise that
it is not the result of a Cost-Push trigger whatsoever.

There are many reasons for the jump in crude (both Brent and WTI)
which directly affect retail pump gasoline. DataAnalytics is working
on a story explaining those reasons, which we will publish in the coming months.

The bottom line here is, that the average driving/commuting consumer
is paying approximately 12% more for gasoline than this time last year.
Couple that sizable 15%-20% increase with inflated cost of staple foods
and the grim pressures of affordability to the average American household continue to mount.

The Shadow Knows…(Housing 2012)

By DataAnalytics

2012 Housing Market observations:

»Update to original post

Confirmed Data-

•Twelve Million Mortgage Holders are now Underwater (Avg of -59K neg equity)
•Mortgage Delinquencies are rising (+60-day)
•Foreclosures are accumulating (REO and pending)
•Shadow Inventory remains elevated (disclosed & undisclosed)
•Underemployment/Unemployment is stuck at 11+% (U3)
•Wages and salaries are stagnant (which lowers purchasing power)
•Food & Fuel Inflation remains elevated over 2010 levels

Probable Data-

•Mortgage delinquencies will likely increase
•Overall housing inventory will likely increase
•Unemployment will remain in double-digit territory
•Real GDP will remain below 3% through Q3 of 2012
•Public and Private Debt is increasing
•Food & Fuel Inflation will remain high and may increase

As 2012 rang in, there were the so-called experts weighing in on the
Housing Market and their predictions for the new year. Most are choosing
to stand on the side of a declared price-bottom.

»The Fed’s January report stated that 12 million mortgages are
now underwater to the tune of an average -$59,000 negative per loan.
Adding to the already existing $700 Billion in negative home equity.

»So as distressed inventories keep increasing, prices will continue to fall.
Which means, these already negative equity mortgage holders will be
losing even more value in their homes. You can be certain that a portion of
these mortgage holders will be walking-away from their sinking ships…

DataAnalytcis, contrary to main stream prediction, is standing
across the proverbial street, and stating that most of 2012 will
not be the year of a price bottom. Perhaps their might be a start
to a trending uptick beginning in Q4, but only perhaps.

But with at least 1.6 Million units of shadow housing inventory
lurking- (mind you this is ONLY what is being disclosed and reported,
as it is widely believed that there could be upwards of double that figure)
on top of the 2.6 Million of existing units, (nar data is always suspect)
plus 160k of new homes and the approximately 1.5 Million units of
already foreclosed properties and clearly inventory levels are not subsiding.

total housing inventory 07-11

The glut of approximately 5 Million to 6 Million total housing units with
a very likely probability of more distressed properties hitting the market
will keep pushing prices downward. Couple the massive inventory problem
with what is basically flat to little demand AND then add in the major issue of
unemployment to the housing depression mix for a real witches brew…

Fact: 39% of loans in foreclosure have not made a payment in two years,
and 72% have not made a payment in over one year.

• 2.36 million loans over 60 days delinquent.
• 1.84 million loans 90+ days delinquent.
• 2.17 million loans in foreclosure process.

For a grand total of 6.37 million loans delinquent or in foreclosure 
as of September of 2011.

One aspect that is tethered to the unprecedented 22%-23%
underemployment/unemployment rate in the U.S.- is, the
pending 2012 presidential elections.

What do we know about all financial and economic markets? Easy.
Markets like stability, (for the most part) markets thrive in predictable
and certain parameters.

This includes the labor market and the housing market.
DataAnalytics thinks that one of the issues preventing the labor
markets from recovering, is the unpredictability and uncertainty
of the political landscape.

When a market and its manipulators know or have a very good idea of
who is calling the shots, it tends to be more or less predictable.
Fact: Companies are not adding enough jobs to lower the unemployment rate.

underemployment/unemployment rates

While there are various reasons for this; such as the increased costs of
employer-provided health benefits, along with the uncertainty of tax policy,
results in a reluctance to increase hiring or begin to hire. Which can be pinned
down to the current and often unpredictable administration currently in the White House.

But come November 2012, the markets will have a clearer path to its destination;
Whoever secures the White House in 2012, be it the DNC or GOP, the markets
will know what to fairly expect. Although, if this current and ineffective administration
retains the Presidency, the labor market will probably be very slow to improve if at all.
With other major and investment markets following suit.

Market surety is one of the keys to growth in our mixed-market free economy.
Replace abnormal market volatility with some sort of actual cohesion and
the indicators will begin to show signs of Real improvement.

The main issue facing our economy will be the implementation of said
cohesive force- that will enable hiring within the job market. Sounds
easy, right? Well as with almost everything, the delta between theory
and practicality remains vast. Philosophically, Socially and Politically,
those differences are just a few of the stumbling blocks on the road to recovery.

Collecting credible data is always challenge in this 24-7, online world.
With the enormous amount of data available, scattered widely
across the many spectrum’s of information, an independent researchers
job to mine reliable data is more difficult than ever.

Information and data collected and then disseminated by the government and
in-house organizations (such as the nar, BLS, nhba, Commerce Dept., etc.,)
usually results in biased and inaccurate reports.

DataAnalytics, an independent resource, always attempts to collect and verify
data then report all discovered information without bias.

Partial data in this report was collected from LPS, CoreLogic and RPX data.

Jobless Rate is at 11.4%

VIA ZEROHEDGE

“One does not need to be a rocket scientist to grasp the fudging the BLS has been
doing every month for years now in order to bring the unemployment rate lower:
the BLS constantly lowers the labor force participation rate as more and
more people “drop out” of the labor force for one reason or another.”

“While there is some floating speculation that this is due to early retirement,
this is completely counter-factual when one also considers the overall rise
in the general civilian non institutional population.”

“In order to back out this fudge we are redoing an analysis we did first back in
August 2010, which shows what the real unemployment rate would be using
the real labor force participation rate.”

Read More about it from Tyler Durden

Household Inflation & Commodity Prices

By DataAnalytics

So, how far is your dollar stretching these days? We know, not very far.
It seems that almost everything costs more today than it did last year at
this time. Well, in fact almost everything does cost more. But wait, the
BLS states that consumer inflation has increased only 3.4%. Really?

Well, you can forget the mostly impractical CPI-U Index published by
the government. What matters abundantly and has a significant
impact to the average consumer is Household Inflation.

Those household ‘commodities’ are the everyday items we all use and mostly
need with a few basic ‘wants’ in the mix as well. Such as; Food, Fuel, Apparel,
household Appliances and Electronics.

According to the “Basket of Goods” utilized in the governments CPI-U index,
inflation is approximately, +3.4% (NSA). The simple fact is that this ‘measure’ of
inflation is not relevant or indicative of real-world household/consumer price inflation.

The fact is that aggregate household-commodity inflation on nominal prices
from one year ago in October- (y-o-y comparative analysis ) for these items-
(Food, Fuel, Apparel, Appliances and Electronics) has risen +35.30%. (cumulative)
(For a breakdown of commodities and price-levels, see the graphs below)

What this really means is that the purchasing power of the average U.S. consumer
has greatly decreased, approximately 35% for these basic staples from 2010.

So what exactly has been the causation of the rapid acceleration in food, fuel,
clothing and electronics then? It”s certainly not Demand-Pull inflation. ‘Demand’
for most household commodities and gasoline has been less than last year and
personal consumption has dropped a whopping 24% from Q2 to Q3.

Could a portion of commodity inflation be tied to a Cost-Push? Perhaps,
but it would be a minor amount of the overall aggregate price rises.

Well on the food side, we know that the prices of cornmeal, sugar, rice and wheat
have been driven up by a variety of factors- first, is the slight drop off in crop
yields and second, is speculation as well as the effects of monetary supply
and wage stagnation.

inflation cereal rice pasta meat eggs

Total Rise of Cereal, Rice, Pasta, Cornmeal, Meat, Poultry, Fish, Eggs: 20.82%

inflation milk fruits bread

Total Rise of Milk, Fruits, Vegetables, Bread: 24.39%
(Total Aggregate Rise of Staple Food Commodities: 22.60%)

Examining Apparel, Appliances and Electronics, specifically, home video
and audio, we see only a moderate increase in price levels from Oct. 2010.

tv clothes appls

Total Rise of Apparel, Appliances and Electronics: 5.54%

On the fuel side, it is down to OPEC and to some extent, futures trading. We know that
OPEC will no longer sell crude for less than $90-$95 per barrel for any length of time.
This ‘built-in’ price floor sets the stage for the loosely monitored, but undeniable
‘fixed-pricing’ basis on crude. Mix in speculative trading and the market is able to
some extent, manipulate the cost per barrel.

avg gas prices

Total Rise of Regular Gasoline Per Gallon Nationally: 7.15%

Given the fragile state of the U.S. economy and the unprecedented
unemployment/underemployment rate of 22%-23%, how much more
price inflation can the average household absorb?

An ideal economy retains price-stability, which at the moment we have
none of. So what does our inflation analysis reveal? Well, the obvious is that
most household commodities are costing over 35% more than they did in 2010.

Secondly, price-inflation seems to be somewhat fragmented and without argument,
some of these price rises are transitory, with a historic trend of being somewhat
predictable. But that has not been the case as of late.

Yes, most household food commodities have been shifting downward since
the beginning of 2011, with retail gasoline following suit, while the rise in rents are
averaging only about 5% nationally. On the other side of the coin, housing asset
prices have declined and continue to fall, with auto prices remaining fairly stable.

So as we close out 2011 the U.S. economy remains in a state of flux with most
tangible assets deflating, while commodities are still above 2010 price levels and
could easily rise again. The bigger question looming is what will this ‘push-pull’ yield
going into 2012? Much of it depends on the broader macro-picture, the all important
labor market, the presidential election and the Eurozone crisis will all play a role in the
macro economic picture.

The bottom line is that the variables involved, both domestically and abroad are
unknown in terms of predictability and performance. The U.S. as well as Europe
and parts of Asia could remain in this unstable economic environment for a couple
of more years or perhaps even longer. But here at home, the dollar can only be
stretched so far, before it eventually breaks.

 

For analysis purposes the following methods were implemented
*price averages reflect the retail mean.
*each commodity group was weighted.
*food commodities combined. (previous correction)
*apparel, appliances, electronics combined
Partial data derived from IndexMundi, IBD and consumer surveys

Eurozone Crisis – Michael Lewis’ ‘Boomerang’

PBS NewsHour interview clip with Michael Lewis.

‘Money Thrown Out in Hope, Coming Back in Anger’

The Long-Term Unemployed – Demise of the Middle-Class

By DataAnalytics

While Congress and the most disappointing administration in decades praised their own
efforts and actions in seemingly lowering the U3 unemployment rate last Friday,
from a supposed 9% to a reported 8.6%, they ignored many negative glaring facts.

Indeed, the Private Sector added 120k net jobs, (revised down to 100k) but
-315 thousand workers gave up searching for jobs altogether, which is why the U3 rate dropped.
The U.S. is averaging approximately -350k first-time unemployment claims per week.
While only averaging about 125k jobs added per month. It takes at least 100k per month
just to keep the rate steady and a minimum of 200k per month to lower the UE rate.

Now on to the more disturbing and eye-opening statistics-
Long-Term Unemployment. The mean (or the average for those not familiar)
duration of unemployment in November 2010 was 34 weeks.
The mean duration of unemployment in November 2011 WAS a whopping 41 weeks.
A very sharp and alarming  increase of +7.1%.

Historically, the delta between the U3 and U6 rates has been approximately 3.9%. The spread has been up over 5% now. Another alarming data point is that 43% of all jobless persons are now the Long-Term unemployed. The U.S. is closing in on nearly half of the unemployed being out of work for a minimum of 27 weeks all the way up to 260 weeks.

Up until mid-year, the duration had been hovering in the 30 to 35 week range,
but has now made a significant jump since late 2010. What does that data reveal?
For one thing, unemployment is not easing or subsiding at all. In fact, it is worsening.

The BLS is simply deceiving the American public. The labor market is in
serious trouble and no one is tackling the problem head on. A lot of rhetoric and finger-pointing
from politicians, but no action. As the duration of the long-term unemployed keeps climbing,
so does the desperation and the continuing erosion of the middle-class.

Another interesting point to note is that the BLS changed the long-term
metric from 24 months or 100 weeks to 60 months or 260 weeks.

The take away here is that more and more workers are going without a job
for longer and longer periods of time. The negative results will be felt as purchasing power is reduced further and further. And, as household/consumer inflation keeps rising, the value of a dollar will keep sinking.

Our prediction is for a continuation of a depressed economy, more foreclosures
and higher commodity prices well into 2012. As it is, foodbanks and food pantry’s
are stretched to their limits. There are approximately 43 million people receiving food
stamps and 16 Million children in America living in poverty. Very sad and shameful indeed for
one of the most wealthiest nations in the free-world.

Gas Paradox: Falling Demand, Rising Prices (via WSJ)

U.S. gasoline demand has dropped to a 12-year low, yet consumers are paying the highest-ever prices for this time of year. The reason: Rising global oil prices are in the driver’s seat.

The paradox isn’t limited to the gasoline pump. Home-heating oil users will see record-high bills, despite using less fuel, according to an Energy Information Administration forecast.

Diesel fuel prices are up 25% from a year earlier at record November levels, fueled by a powerful one-two punch of surging demand both in the U.S. and abroad, the EIA and analysts added.

Prices for gasoline, diesel and heating oil are determined by global demand and worldwide crude prices. That notion is sometimes lost, with the emphasis misplaced on the U.S. benchmark.

Read More Here