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Economy added 223,000 jobs in May, but Trump's premarket tweet is the focus

Surrealistik said:
I didn't say NFP was _as_ significant as interest rates, I said it was up there and among the most significant.
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I can't tell if you're playing with semantics intentionally.

That having been said, NFP is absolutely a big short term market mover; you're more than welcome to look over USD pair prices after NFP releases (particularly where there's significant deviation from consensus projections) and observe this fact for yourself.

Moveover, some 101 for you since you clearly don't understand its significance: https://www.investopedia.com/articles/forex/09/non-farm-payroll-report.asp
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Okay, Cory Mitchell from investopedia believes NFP's are among the most important and has some evidence of its significance. I don't believe NFP is among the most important factors and I have evidence showing it's lack of significance.

Aside from that, I'm not sure what you are really trying to argue; because since we are in agreement that interest rates and inflation have much more significant to a nation's currency than employment data.

Absurd. Excess return in this case would be predicated on the fact that you made 0.46% on your position, before leverage (where again, relatively high leverage multipliers are typical and standard for USDJPY), in four hours ((109.714/109.212)-1); let's call that a day. You're not buying and holding, you're taking a short term trade predicated on Trump's tweet which implies the direction of a typically impactful news piece; 0.46% annualized works out to a whopping 5.332 multiplier or 433.2% return, and prior to any leverage! That's not to say you can consistently duplicate this trade yield daily for a year of course; the idea is to highlight the impressive, and uniquely high yield of the trade that was enabled/inspired by the leak.
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I don't think you understand this very much.

Yen returns have a normal distribution, with a 5-year average return of 0.01% and a standard deviation of 0.56%. If we assume a normal distribution, this means that 68% of all one-day returns involving the Yen are clustered within 1 standard deviation from the mean. 1 standard deviation from the mean puts the average Yen investor anywhere from +0.57% to -0.55% (the mean +/- 1 multiplied by the standard deviation). Yesterday, the Yen earned 0.62%, which places it 1.08 standard deviations away from the mean. Slightly above average, but not significantly above average.

In order to be significantly above average, you need to trade above 3 standard deviations above the mean. Three standard deviations above the mean would give you a one day return (loss) of 1.70%. Within the last 5 years, there are only 12 instances where the Yen has gained/lossed more than 1.70% in a single day.

Now I could calculate the probability of that happening and all that other stuff. The point is, no one trading on the Yen earned more than 1.70% holding the Yen yesterday.

Categorically wrong per anyone who knows anything about the impact of the NFP; the power of the NFP to influence Forex markets short term is basic 101 stuff man.
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Surrealistik said:
I didn't say NFP was _as_ significant as interest rates, I said it was up there and among the most significant.
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You do when leverage is SOP and standard for the Forex market, particularly in liquid low volatility pairs (nevermind that 0.46% pre-leverage in a day is huge in Forex for USDJPY).
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Leverage is not standard for the FOREX market; only retail investors need to use leverage.

Banks, Governments, Monetary Authorities, Corporations, Investment Funds. They are all participants in the FOREX market; they do not require leverage to participate.
 
Hedgology said:
How do you know?
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How do you not?

When Obama was President, Trump was on the record (multiple times) claiming employment data was fake/fraudulent/manipulated. Since taking the Presidency, can you point to a single tweet or quote that maintains such sentiment?

then it's not useful to me because everyone else can trade based on the same information.
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Nobody cares.

Want to know what rational people are wondering? Why is Trump undermining his own administration?
 
Hedgology said:
Okay, Cory Mitchell from investopedia believes NFP's are among the most important and has some evidence of its significance. I don't believe NFP is among the most important factors and I have evidence showing it's lack of significance.

Aside from that, I'm not sure what you are really trying to argue; because since we are in agreement that interest rates and inflation have much more significant to a nation's currency than employment data.
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As stated, you are more than welcome to check out the actual price impacts of NFP and the overflowing volumes written about its importance/impact in relation to trading Forex.

Bottom line, the point is that while the NFP may not be as relevant as interest rates/inflation/Fed announcements and policy, it absolutely does move currency (and other) markets significantly in the short term and its release is widely and rightly regarded as being a trade event of importance.

I don't think you understand this very much.

Yen returns have a normal distribution, with a 5-year average return of 0.01% and a standard deviation of 0.56%. If we assume a normal distribution, this means that 68% of all one-day returns involving the Yen are clustered within 1 standard deviation from the mean. 1 standard deviation from the mean puts the average Yen investor anywhere from +0.57% to -0.55% (the mean +/- 1 multiplied by the standard deviation). Yesterday, the Yen earned 0.62%, which places it 1.08 standard deviations away from the mean. Slightly above average, but not significantly above average.

In order to be significantly above average, you need to trade above 3 standard deviations above the mean. Three standard deviations above the mean would give you a one day return (loss) of 1.70%. Within the last 5 years, there are only 12 instances where the Yen has gained/lossed more than 1.70% in a single day.

Now I could calculate the probability of that happening and all that other stuff. The point is, no one trading on the Yen earned more than 1.70% holding the Yen yesterday.
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I don't think you're understanding my argument, which is fundamentally reducible to the fact that a position entered into at the time of Trump's tweet would have netted significantly more than a position entered at the time of NFP's official release, and that his foreshadowing made possible an impressive, high confidence, high probability return for the day.

Whether or not the return is within the 68% percentile envelop of the SD is irrelevant: yes, in all probability, your return is going to fall within or be close to a range that contains 68% of the daily variance of the USDJPY over the past 5 years. That does nothing to obviate the fact that a 0.46% base daily return (or more, depending on where you closed), pre-leverage, is impressive, particularly for USDJPY, (as especially evinced by its annualization), and handily exceeds the average daily return of the vast majority of traders/investors/funds many times over. When leverage is involved, as it invariably is when it comes to speculative Forex trading, that easily becomes 2.3% or more.

Leverage is not standard for the FOREX market; only retail investors need to use leverage.

Banks, Governments, Monetary Authorities, Corporations, Investment Funds. They are all participants in the FOREX market; they do not require leverage to participate.
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Leverage is indeed standard for _speculation_ in Forex among low volatility, high liquidity currencies and is the norm, not the exception, given that Forex returns would be otherwise paltry; retail traders may use more leverage (often much more leverage that makes me personally uncomfortable), but all speculative participants, retail or otherwise, typically use some amount; as stated, 10-30 : 1 is not uncommon for a pair such as USDJPY, at least for a high confidence trade. That said, the larger the professional body/institution engaging in speculative trading, the lower the ratio tends to get on average, yes, often dwindling to the single digits.
 
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NeverTrumpGOP said:
He is not allowed to even say he looks forward to them. That is a comment.
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Link? Is there a law that you are referencing?

After our exchange yesterday on this, I heard this on various left leaning news sources. All references were murky and non-specific as yours is. Sounds more like a propaganda talking point than a law.

What law was broken? There should be some entry in the criminal code.

What is it?

Here's an example of an entry in the criminal code:

<snip>
U.S. Code › Title 18 › Part I › Chapter 51 › § 1111
<snip>

https://www.law.cornell.edu/uscode/text/18/1111
 
tres borrachos said:
The rule Trump may have violated is set out by the Office of Management and Budget, in the heretofore dry, Statistical Policy Directive No. 3.

The chairman of the Council of Economic Advisers — Kevin Hassett, currently — and the president are allowed to get briefed on the jobs report. However, “agencies must ensure that adequate steps (e.g., sequestering those granted access) are taken to prevent prerelease disclosure or use. So long as there is no risk of prerelease disclosure or use, prerelease access is permitted.”


Here’s what they are required to do: “Except for members of the staff of the agency issuing the principal economic indicator who have been designated by the agency head to provide technical explanations of the data, employees of the Executive Branch shall not comment publicly on the data until at least one hour after the official release time.”

Two areas of wiggle room seem to emerge — one, whether Trump is covered as an “employee of the executive branch,” and two, whether the tweet without numbers can be construed as a “comment.”


https://www.marketwatch.com/story/trumps-jobs-report-tweet-in-advance-of-release-appears-to-have-violated-federal-rules-2018-06-01

It's worth the discussion, isn't it?
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I love discussions, so, yes, it is worth a discussion.

However, Trump did not discuss the report. He only indicated that he was excited to see "the numbers". From the statement, taken by itself, we don't even know that he had seen it or knew anything about it.

Finally, the unemployment numbers are the best since the Clinton days, the wage rate was adjusted higher than the leaks (from other sources) had it pegged and the economy added about 30,000 more jobs than the experts (again, not Trump) had leaked previously.

In the Much Ado About Nothing reporting employed to distract from the nearly continuous good news regarding everything, this seems to be just one more example.

The jobs report was awesome, but don't pay attention to that. Trump's a jerk.

You can publish this story every day and NBC does. Fill in the blank on the topic at the front end and end it with"..., but Trump's a jerk".

That's a story that's in the first 5 minutes of EVERY EVENING NEWS CAST from NBC.

The latest ABC's of this was that the various A-holes reporting on the B**** who called the president's daughter a C*** while using the "feckless" incorrectly.

This crude and unjustifiably confident ideologue must have heard the word in reference to Obama and probably just thought if it's bad, then it must apply to someone I'm attacking.

Her apparent lack of understanding of the language was not important in any way to those relaying the real news that, wait for it...

Trump's a jerk.


https://www.thestreet.com/markets/u...ay-14608008?puc=yahoo&cm_ven=YAHOO&yptr=yahoo
 
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Hedgology said:
How do you know?
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Because he's a narcissist and it's impossible to believe he'd highlight, direct attention to, a bad report.

If everyone knows about this information, then it's not useful to me because everyone else can trade based on the same information.

A competitive advantage is not something you achieve by engaging in the same strategies that everyone else is using. This is why arbitrage opportunities don't exist for very long. As soon as the market finds out about said opportunity, it becomes very difficult to profit from it for very long.
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You've been discussing this topic with a guy who said he traded on the information. You saying he didn't isn't persuasive, and the reason arguably no one can make money trading the tweet is everyone traded instantly on the tweet..... Your "for very long" explains it nicely.
 
JasperL said:
Because he's a narcissist and it's impossible to believe he'd highlight, direct attention to, a bad report.



You've been discussing this topic with a guy who said he traded on the information. You saying he didn't isn't persuasive, and the reason arguably no one can make money trading the tweet is everyone traded instantly on the tweet..... Your "for very long" explains it nicely.
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You always have to find something to attack Trump and charge him with inappropriate activities never able to celebrate success. Here is the success you want to ignore


Labor Force Statistics from the Current Population Survey
Original Data Value

Series Id: LNS12000000
Seasonally Adjusted
Series title: (Seas) Employment Level
Labor force status: Employed
Type of data: Number in thousands
Age: 16 years and over
Years: 2008 to 2018

Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2008 146378 146156 146086 146132 145908 145737 145532 145203 145076 144802 144100 143369
2009 142152 141640 140707 140656 140248 140009 139901 139492 138818 138432 138659 138013
2010 138438 138581 138751 139297 139241 139141 139179 139438 139396 139119 139044 139301
2011 139250 139394 139639 139586 139624 139384 139524 139942 140183 140368 140826 140902
2012 141584 141858 142036 141899 142206 142391 142292 142291 143044 143431 143333 143330
2013 143292 143362 143316 143635 143882 143999 144264 144326 144418 143537 144479 144778
2014 145122 145161 145673 145680 145825 146267 146401 146522 146752 147411 147391 147597
2015 148113 148100 148175 148505 148788 148806 148830 149136 148810 149254 149486 150135
2016 150576 151005 151229 150978 151048 151164 151484 151687 151815 151939 152126 152233
2017 152076 152511 153064 153161 152892 153250 153511 153471 154324 153846 153917 154021
2018 154430 155215 155178 155181 155474
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Part time for economic reasons meaning they couldn't find a full time job

Labor Force Statistics from the Current Population Survey
Original Data Value

Series Id: LNS12032194
Seasonally Adjusted
Series title: (Seas) Employment Level - Part-Time for Economic Reasons, All Industries
Labor force status: Employed
Type of data: Number in thousands
Age: 16 years and over
Hours at work: 1 to 34 hours
Reasons work not as scheduled: Economic reasons
Worker status/schedules: At work part time
Years: 2008 to 2018

Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2008 4846 4902 4904 5220 5286 5540 5930 5851 6148 6690 7311 8029
2009 8046 8796 9145 8908 9113 9024 8891 9029 8847 8979 9114 9098
2010 8530 8936 9233 9178 8845 8577 8500 8800 9246 8837 8873 8935
2011 8470 8464 8645 8652 8576 8427 8281 8788 9166 8657 8447 8171
2012 8305 8238 7775 7913 8101 8072 8082 7974 8671 8203 8166 7943
2013 8151 8178 7722 7964 7937 8103 8099 7816 7764 7936 7718 7827
2014 7302 7304 7451 7516 7260 7425 7400 7169 7007 7031 6885 6817
2015 6820 6693 6653 6622 6643 6386 6234 6411 6025 5807 6159 6027
2016 5960 6021 6099 6027 6491 5751 5898 5977 5893 5955 5719 5554
2017 5776 5670 5500 5309 5268 5264 5236 5209 5148 4880 4851 4915
2018 4989 5160 5019 4985 4948
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pinqy said:
No, it does not. Only a third of of those classified as part time for economic reasons could not find a full time job. 28% of part time for economic reasons actually do have full time jobs. https://www.bls.gov/web/empsit/cpseea25.htm
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The under employed was 9.4% when Obama left office and he averaged over 13% for his term. That to you and the left is a success. It is 7.6% TODAY
 
danarhea said:
So Trump breaks the law and you call those who criticize his breaking the law a Trump hating, pencil-nicked geek.

So much for the law. I think I'll go out and rob a bank. LOL.
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There's no proof he did anything of the sort.

Just the one guy.
 
WCH said:
That's good because he didn't.

You people are desperate.
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I try to defend Trump on a bunch of things. Not this time. It was a stupid thing to do plain and simple. This constant self-promotion is one of his least attractive qualities.
 
MateoMtnClimber said:
The president is an employee of the executive branch. What else would he be? A tweet is a comment. He sent an unambiguous signal that the numbers were going to be positive.
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The numbers have been positive for months now. It was a pretty good bet they would be good at the start of summer/vacation season.
 
Conservative said:
The under employed was 9.4% when Obama left office and he averaged over 13% for his term. That to you and the left is a success. It is 7.6% TODAY
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I win! My internal bet was that you would completely ignore what I actually posted, refuse to admit you were incorrect, and go off on a tangent.
 
Hedgology said:
You don't understand your own points; you don't understand my points; and when points are explained to you, you think there is a contradiction.

This is not a conversation for you.

I bet people do the exact opposite of whatever makes sense to you.

Right, because you said it so eloquently that it wouldn't have made sense to anyone.
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There you go! More condescension and you still can't address simple points. So sad for you.

You managed money. Why don't you take your best guess and tell me.
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Hey, I'm just a dumb redneck from Tennessee who has to Google EMH. I'm asking the big shot investment banker from NYC with a Bloomberg terminal to explain why I'd pay anyone a penny for managing a stock portfolio if EMH holds. If it does, why not buy index funds that match the market managed at 0.1% or so?

Because strong form market efficiency held on Friday.
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You can't begin to assert that. You have no evidence and no no f'ing idea if it did or not. And a theory either 'holds' every day or it's not a useful theory. That's why you switching from the strong to the medium to weak forms of EMH is so stupid. If the strong form means anything, it holds, period. If not in all cases, such as with insider information, there is no reason to assert it ever, because you've decided it's not a useful theory.

The only interest rate assets that trade publicly are bonds and they performed horribly at the end of the session.
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That's crap too. More of your bull****. Just for the simplest example, there are publicly traded closed end mutual bond funds, and some stocks are obviously more interest rate sensitive than others and will move more on changes in them than companies with no or low debt.

Aside from that, you have a fair point. You can make excess returns by knowing EXACTLY which assets would appreciate from the NFP report news. This would require you to have a portfolio of about 3 or 4 stocks, know exactly which 3 or 4 stocks would make the biggest gains, and hold them until market closed. Yeah, picking 3 or 4 winners out of an entire universe hundreds of thousands of stocks? That's not hard to do? Only 5% of money managers were able to do that.
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LOL, there is no need to hold any position to the closing bell. There were traders who made at least 100s of trades on Friday, many who made dozens at least and their returns for the day would vary from negative to far more than 1.08%. And the 5% is for some period like a year, not on Friday. I imagine on Friday the odds are more like 50/50 than 95/5. The trouble is repeating it.

The fact that you can't make an argument against the information being released beforehand just demonstrates that it doesn't make a lot of sense.
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I made an argument and you've ignored it and others.
 
Kushinator said:
How do you not?

When Obama was President, Trump was on the record (multiple times) claiming employment data was fake/fraudulent/manipulated. Since taking the Presidency, can you point to a single tweet or quote that maintains such sentiment?
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Do you not know whether or not Trump would have commented (tweet or otherwise) on the Job's report if the report was negative.

You can speculate whether that would have been the case, but that is all you can do. As long as I know you are speculating, I don't really need to try hard to refute your notions.

Nobody cares.

Want to know what rational people are wondering? Why is Trump undermining his own administration?
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He said he was "looking forward to the Job Report @ 8:30 this morning:

How exactly is that undermining his own administration?
 
pinqy said:
I win! My internal bet was that you would completely ignore what I actually posted, refuse to admit you were incorrect, and go off on a tangent.
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So part time for economic reasons are counted in the U-6 as under-employed?? Here I thought you were intelligent. So it really matter what percentage of those are part time for economic reasons as they remain under employed due to poor economic conditions
 
washunut said:
I try to defend Trump on a bunch of things. Not this time. It was a stupid thing to do plain and simple. This constant self-promotion is one of his least attractive qualities.
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Oh like that never happens with other POTUSs. When it's a good thing.... Shout about it.
 
Conservative said:
So part time for economic reasons are counted in the U-6 as under-employed??
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no, they are not. “Underemployed” is not a classification used by BLS.


Here I thought you were intelligent. So it really matter what percentage of those are part time for economic reasons as they remain under employed due to poor economic conditions
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Yes, of course it matters. There is definitely a difference between someone who usually works full time but for one week had slow business or hours cut, and someone for whom those cut hours have lasted more than 6 months, and someone who is willing and able to work full time but has not been able to find a full-time job in the last 6 month, and someone working fewer hours because it’s the off season.

You stated that “part time for economic reasons” meant “could not find a full time job.” You were incorrect. If you cared about being accurate, you would appreciate being corrected.
 
Hedgology said:
Do you not know whether or not Trump would have commented (tweet or otherwise) on the Job's report if the report was negative.

You can speculate whether that would have been the case, but that is all you can do. As long as I know you are speculating, I don't really need to try hard to refute your notions.
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We do know that, actually. He's got a pattern - hard to miss unless you're trying to miss it.
 
pinqy said:
no, they are not. “Underemployed” is not a classification used by BLS.



Yes, of course it matters. There is definitely a difference between someone who usually works full time but for one week had slow business or hours cut, and someone for whom those cut hours have lasted more than 6 months, and someone who is willing and able to work full time but has not been able to find a full-time job in the last 6 month, and someone working fewer hours because it’s the off season.

You stated that “part time for economic reasons” meant “could not find a full time job.” You were incorrect. If you cared about being accurate, you would appreciate being corrected.
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And here I thought you were an expert on BLS but apparently you aren't not that I ever thought you were anyway

Going beyond the unemployment rate | Pew Research Center

FACT, People working part time for economic reasons are included in the U-6 and are UNDER EMPLOYED and that is different that someone who CHOOSES to work part time.
 
eman623 said:
It's times like this that I'm truly grateful Hillary Clinton lost in 2016. Had she been president now, I'd have to listen to endless prattling from Liberals about the "2nd Clinton Miracle" and how they have the Midas touch and hypercharge the US economy under their stewardship blah blah blah.

As it is, the best they can do is give the credit to Obama. Because Dems always get credit for any good economic news. Republicans only get the blame for bad news.
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Actually in all of my adult life, it's been the opposite. Reagan blamed Carter for the recession he inherited. (it was an oil embargo in 1979)
Then repub claimed that all of the jobs created under B. Clinton even though Clinton's policies were a complete reversal of Reagan's policies
nonetheless, the 'Rs' voted unanimously against Clinton's first tax bill and budgets, yet were still proof the Reagan's policies were coming through. BULL****

During all of the job growth under Obama, the right continually said it was despite Obama's policies and of course...without saying just which policies.

So the left has a right to say that despite Trump's policies, Obama's economy continues to roll right along, strongly adding jobs.
 
JasperL said:
ADP is a....survey! Methodology here. They say upfront that they try to match the BLS methodology, with some exceptions. Essentially they're trying to provide investors and others with a 2 day head start on the official release of the employment situation report.

But the key point is they don't have data on every company, and so their numbers are extrapolations from data they do have to the economy as a whole, which is similar to what BLS does.

And a big part of the BLS releases are the unemployment rates of various kinds (U1-U6), and that cannot be captured by surveying businesses. You have to survey individuals, and private companies don't survey individuals.
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Moody's conducts surveys?

I'm pretty sure that the accountants and statisticians employed by Moody's would be astonished to discover this.
 
Conservative said:
And here I thought you were an expert on BLS but apparently you aren't not that I ever thought you were anyway

Going beyond the unemployment rate | Pew Research Center

FACT, People working part time for economic reasons are included in the U-6 and are UNDER EMPLOYED and that is different that someone who CHOOSES to work part time.
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Pew research is not BLS, is it? Here is the BLS glossary. https://www.bls.gov/bls/glossary.htm Tell us what BLS considers “underemployed.” What unofficial terminology others use is irrelevant. Underemployed is a very subjective term.
 
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