The Peter Schiff Show Podcast

Friday 13th was not unlucky for Wall Street

S&P 500 traded to an all-time record high

The Dow closed above 18,000

NASDAQ at almost a 15-year high

Despite overall trend of weak corporate earnings

Weak economic data does not dampen Wall Street's spirits

Central Banks are behind the surge with excess liquidity

Wednesday - Mortgage Applications plunged 9%

Purchases declined 7% following a 2% decline prior week

10% decline in Mortgage Refinances

Jobless claims up 25,000 from prior week

Biggest back-to-back decline in Retail Sales since October of 2009

Consumer Confidence is down 2 weeks in a row

Business Inventories rose by just .1% contrary to expectations

Inventory to sales ratio highest since July 2009

Huge drop in Consumer Sentiment

Jobs number is a lagging indicator

Part-time economy is a double-edged sword

* China announces a record trade surplus

* Media reports surplus as bad news for China

* Because of the strength of the Yuan, Chinese can buy more imports for less

* Chinese consumers purchasing more

* Chinese businesses manufacturing more

* Contrary to press reports these factors point to a strong economy in China

* U.S. has record deficits along with a strong dollar

* The short term effect of a strong currency is that trade deficits should go down because imports are cheaper

* The fact that our trade deficit continues to rise illustrates underlying economic weakness

* Media double standard: China trade surplus is bad but U.S. trade deficit is good

* Media reports "low rate of unemployment" among college grads, however:

* Record number of college graduates are under employed

* Only 44% of employed Americans work 30 hours or more per week

* In future, the smarter students will skip low-value degrees in favor of work experience

* Shake Shack IPO valuation $1.5 billion on $5 million profits

* Grilled Cheese Truck: valued at $100 million on negative revenues

* Black is white and white is black: Twilight Zone


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China announces a record trade surplus

Media reports surplus as bad news for China

Because of the strength of the Yuan, Chinese can buy more imports for less

Chinese consumers purchasing more

Chinese businesses manufacturing more

Contrary to press reports these factors point to a strong economy in China

U.S. has record deficits along with a strong dollar

The short term effect of a strong currency is that trade deficits should go down because imports are cheaper

The fact that our trade deficit continues to rise illustrates underlying economic weakness

Media double standard: China trade surplus is bad but U.S. trade deficit is good

Media reports "low rate of unemployment" among college grads, however:

Record number of college graduates are under employed

Only 44% of employed Americans work 30 hours or more per week

In future, the smarter students will skip low-value degrees in favor of work experience

Shake Shack IPO valuation $1.5 billion on $5 million profits

Grilled Cheese Truck: valued at $100 million on negative revenues

Black is white and white is black: Twilight Zone

* Monthly non-farm employment number beat expectations

* Upward revisions to prior months

* Average hourly earnings number jumped by .5

* Immediate reaction in the market was swift

* Dollar up; gold down

* Unemployment up

* Labor force participation down among younger workers

* Jobs number inconsistent with other weak economic data

* Layoffs are up

* Government is way off on "jobs lost" data

* Yesterday's trade deficit was the largest increase recorded

* If our economy were strong, our workers would be producing and we would not rely on imports

* Trade deficit is subtracted from the GDP

* Productivity numbers weaker than expected

* How many times can the dollar rally on the same news?


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Monthly non-farm employment number beat expectations

Upward revisions to prior months

Average hourly earnings number jumped by .5

Immediate reaction in the market was swift

Dollar up; gold down

Unemployment up

Labor force participation down among younger workers

Jobs number inconsistent with other weak economic data

Layoffs are up

Government is way off on "jobs lost" data

Yesterday's trade deficit was the largest increase recorded

If our economy were strong, our workers would be producing and we would not rely on imports

Trade deficit is subtracted from the GDP

Productivity numbers weaker than expected

How many times can the dollar rally on the same news?

* Volatile day in the markets

* Largest decline in Personal Spending since September 2009

* Wages and Salaries gain slowest in 7 months

* December ISM Manufacturing Index down to 53.5

* December Employment growth at 7-month low

* 2.6% GDP number will likely be revised downward

* U.S. Factory Orders declined 3.6% in December

* Oil prices triggering momentum against the dollar

* The FOREX markets are beginning to acknowledge U.S. economic weakness

* QE4 will accompany a budget-busting economic stimulus

* S&P was the only agency penalized by the government for rating sub-prime mortgage AAA

* S&P is actually being penalized for downgrading U.S. government debt

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Volatile day in the markets

Largest decline in Personal Spending since September 2009

Wages and Salaries gain slowest in 7 months

December ISM Manufacturing Index down to 53.5

December Employment growth at 7-month low

2.6% GDP number will likely be revised downward

U.S. Factory Orders declined 3.6% in December

Oil prices triggering momentum against the dollar

The FOREX markets are beginning to acknowledge U.S. economic weakness

QE4 will accompany a budget-busting economic stimulus

S&P was the only agency penalized by the government for rating sub-prime mortgage AAA

S&P is actually being penalized for downgrading U.S. government debt

* Fed's official statement released yesterday

* Received by the market as hawkish, Fed is still reiterates "patience"

* The statement noted unguarded optimism about the U.S. Economy

* Fed ignored unstable markets, Europe, oil prices and strength of the dollar

* Response: the market sold off and the dollar rallied

* Gold declined on Fed's expectations

* The Fed's underlying goal may be to talk the dollar up and talk the markets down

* Strong dollar buys time

* Continued "patience" indicates Fed's true agenda


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Fed's official statement released yesterday

Received by the market as hawkish, Fed is still reiterates "patience"

The statement noted unguarded optimism about the U.S. Economy

Fed ignored unstable markets, Europe, oil prices and strength of the dollar

Response: the market sold off and the dollar rallied

Gold declined on Fed's expectations

The Fed's underlying goal may be to talk the dollar up and talk the markets down

Strong dollar buys time

Continued "patience" indicates Fed's true agenda

* Wall Street spared blizzard only to be buried in bad earnings and bad economic news

* December durable goods down 3.4%; expected to come in at +.7

* Consumer confidence up to 102.9; contrarian indicator

* Last time consumers were this confident was in the middle of 2007

* Number will collapse when reality has a violent confrontation with perception

* P&G earnings down 31%

* Caterpillar warned

* Microsoft stock down 10% today

* UPS announced they overestimated holiday sales

* Businesses geared up for a recovery in late 2013 that was not going to happen

* Layoffs coming in 2015

* This may give the Fed an excuse to delay rate increase

* How can a strong dollar be good for America but a weak euro be good for Europe?


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