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TrimTabs
- Press Release - Feb 2, 2005
Announcing
New Savings Index
Booming
Economy: Wage and Salary Growth Explodes & Online Jobs Posting Index
Up 14.4% According to TrimTabs Investment Research
Santa
Rosa, CA - February 2, 2005 - "Growth in withheld income and employment
taxes returned with a vengeance last week," stated Madeline Schnapp,
Editor of TrimTabs Personal Income. Over the past two weeks, withholdings
grew 8.6% year-over-year and 6.8% year-over-year the past four weeks.
Withholdings last week topped 26% year-over-year. (Growth in withholdings
of approximately 5% year-over-year is indicative of moderate economic
and employment growth.) The recent surge in income tax withholdings suggests
healthy employment growth.
"We
believe that this Friday the Bureau of Labor Statistics Employment Report
should show an employment increase of 250,000 new jobs," said Schnapp.
"However," Ms. Schnapp cautions, "predicting what the BLS
will report is extremely difficult at this time of year due to the enormous
seasonal adjustments applied to the data." The January BLS employment
report is plagued with the largest seasonal adjustments of the year as
the BLS accounts for a normal seasonal decline of about 2.2 million jobs.
In addition, only 60% of the survey will be complete by the time of the
first release, and it will be subject to sizeable revisions over the next
two months. TrimTabs employs a year-over-year analysis of non-seasonally
adjusted BLS employment data that eliminates the need for seasonal adjustments
and provides a clearer picture of the labor market.
TrimTabs
Online Jobs Postings Index confirms that employment growth has been healthy.
The index moved up sharply last week and has been moving up steadily since
the beginning of the year. TrimTabs Online Jobs Postings Index is up 14.4%
since the first of January. Last year at this time, the online jobs index
was up 13%.
Demand
For Corporate And Industrial Loans Is Surging:
Both of TrimTabs' corporate debt indicators continued to rise at a healthy
pace last week. For the past six weeks, demand for commercial and industrial
loans has been growing at an average pace of 0.38% per week which is nearly
three times the average rate experienced during the last half of 2004.
This rapid pace suggests growth at small and medium-sized firms is accelerating.
Demand for non-financial commercial headed out of its two-month flat trend
for the second week in a row. The surge during the past two weeks suggests
large AAA-rated firms are experiencing stronger growth.
New
Savings Index Up Sharply:
"This week, we have added coverage of a new money supply indicator,
which we call total savings. We believe this indicator of money supply
will be more relevant to investment professionals," said Madeline
Schnapp. The indicator is a composite of non-seasonally adjusted bank
savings, small-denomination certificates of deposit, and retail money
market components. Total savings rose by $110 billion this January, which
compares with a decline of $96 billion last January. "The torrent
of cash flooding into savings vehicles suggests the economy and employment
are expanding at a healthy pace. While we do not expect first quarter
GDP to be as robust as the 4.5% growth during the first quarter of 2004,
GDP should rise by about 3.5% in 2005," added Schnapp.
Inflows
Will Return:
The signs of a near-term stock market bottom are now in place. Corporate
buying is surging, corporate selling is declining, wage and salary growth
is booming, and individual investors are deeply pessimistic. If corporate
buying ignites a rally, some of the money investors have been squirreling
away into savings vehicles could eventually find its way into the stock
market.
#
# #
Madeline Schnapp is Editor of TrimTabs Personal Income and TrimTabs Employment
Update. She is a frequent speaker in the financial industry, most recently
presiding at the National Association for Business Economics (NABE) and
the American Association of Independent Investors (AAII).
TrimTabs Investment Research is the only independent research service
that publishes detailed daily coverage of U.S. stock market liquidity,
including mutual funds and Exchange Traded Funds, as well as weekly withheld
income and employment tax collections. Founded by Charles Biderman, TrimTabs
has provided institutional investors - including hedge fund managers,
market strategists, and portfolio managers - with trading strategies since
1990. TrimTabs liquidity research is unique. It is a macro timing tool
to predict the direction of the stock market. For sample research and
subscriptions, visit www.TrimTabs.com.
CONTACT:
Madeline Schnapp
Editor and Senior Research Analyst,
Emerging Economic Trends
+(1) 707.829.8811
Fax: 707.829.5511
Research@TrimTabs.com
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