The Big Picture

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• Succinct Summations of Week’s Events (1/10/14)
• NFP: Pay No Attention to the Statistician Behind the Curtains
• Better times for the music industry
• Video: The Lessons of Gold’s Collapse
• Comedians in Cars Getting Coffee with Louis C.K.
• 10 Friday AM Reads
• The Plural of Anecdote Is Not Data
• 2 Day Course Teaches Ferrari Owners How to Drive

Succinct Summations of Week’s Events (1/10/14) Posted: 10 Jan 2014 01:00 PM PST Succinct Summations week ending January 10, 2014 Positives: 1. ADP came in at 238k v expectations of 200k, its largest monthly increase since November 2012. (Attention Chicago guys: NFP did NOT confirm these strong numbers). 2. 10-year yield saw its biggest one-day decline since October, borrowing is cheaper, woo hoo (for bad reasons, I know) 3. Dennis Rodman, the gift that keeps on giving, is at it again in North Korea. 4. 6.7% unemployment rate is the lowest since Oct 2008 5. November NFP was revised up to 241k v the reported 203k (pending revisions, of course). 6. Initial jobless claims come in at 330k, 5k below expectations. 7. November U.S. trade gap shrank to the smallest since 2009, 'Murka. 8. The Dow Transports are ripping, closing out new all-time highs, ditto for mid-cap stocks. Negatives: 1. NFP reports a lousy 74k workers added, v estimates of 197k. 2. ISM services index fell to 53 v expectations of 54.7. 3. The S&P 500 is down 5 of the first 6 days of the year for the first time since 1991 (which finished up >25%) 4. One of Americas oldest stores, Sears, reported horrific numbers and is in a pile of trouble. 5. Estimates for customers security information breach keeps climbing at Target. 6. The Polar Vortex sucked.

NFP: Pay No Attention to the Statistician Behind the Curtains Posted: 10 Jan 2014 10:30 AM PST Okay, strap in for yet another tirade on why you should (for the most part) pay very little attention to the monthly Non Farm Payroll data, also know as the Employment Situation. Its hype to usefulness ratio is abysmally low. Long time readers know this is a peeve of mine (See list of prior articles below). For newer readers, here is the reasoning behind my disdain. The first has to do with the idea of modeling the real word via assembled data. What you end up with is some form of artificial creation that bears only a passing resemblance to the complexity of the real world. That would not be such a problem, if only you humans remembered what the great professor George E. P. Box advised us: "Essentially, all models are wrong, but some are useful." The usefulness of a model that is wrong is that we can into what us useful and ignore what is wrong. And we know from each month's revisions that the initial read is off, often by a substantial amount. It's a noisy series, subject to many errors and subsequent corrections.     Continues here

Better times for the music industry Posted: 10 Jan 2014 09:30 AM PST Source: Economist

Video: The Lessons of Gold’s Collapse Posted: 10 Jan 2014 08:00 AM PST Source: Yahoo Finance

Comedians in Cars Getting Coffee with Louis C.K. Posted: 10 Jan 2014 06:00 AM PST Source: Comedians in Cars Getting Coffee

10 Friday AM Reads Posted: 10 Jan 2014 05:45 AM PST Good morning. Here’s my Friday on-the-damned-Acela-to-D.C. reading: • Barron's Roundtable: 2013 Performance & Updated 2002-13 Rankings (PunditTracker), see also The Most Expensive "Free" Advice — 2014 Update (A Dash of Insight) • What if the Future Is Better Than We Think? (A Wealth of Common Sense) • Wells Fargo's pressure-cooker sales culture comes at a cost (LA Times), see also Wall Street Predicts $50 Billion Bill to Settle U.S. Mortgage Suits (DealBook)   Continues here

The Plural of Anecdote Is Not Data Posted: 10 Jan 2014 04:30 AM PST Source: Nestler Analytics

2 Day Course Teaches Ferrari Owners How to Drive Posted: 10 Jan 2014 03:00 AM PST Want to drive $300,000 Ferraris on Austin’s brand-new Formula 1 racetrack? A group of 18 Ferrari owners just had the opportunity. The price tag: $13,500. It is part of the Italian company’s first-ever driving school in the U.S. All yours for just $13,500 for 2 days: Source: Bloomberg

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