Non-Farm Payroll (NFP) Predictions for July

Consensus: -75k
ADP: 9k

Last: -62k

Just like in May the ADP and consensus number diverged. Last time the consensus was closer. But does it really matter?

Will NFP continue to be such a big market mover, or will it being to take a back seat to inflation numbers?

To see how the market has reacted to the number vs expectation DailyFX.com has a writeup on the last three months of NFPs.

Support Online Poker

This is from Professor Bainbridge, linked on Volokh:

The Poker Players Association has an urgent action item:

Tuesday, the House Financial Services Committee will review a bill, H.R. 5767, that would block the implementation of UIGEA regulations. In order to get this bill out of Committee on onto the House Floor, we need your help. We need you to contact the committee and express your support for H.R. 5767, as well as the King amendment which will refine the bill language. PPA strongly supports H.R. 5767 and the King amendment, but this important bill and amendment won’t pass without your help!

Call or Fax the House Financial Services Committee* Democrats’ Committee Office:* Ph: (202) 225-4247 - FAX: (202) 225-6952 Republicans’ Committee Office:* Ph: (202) 225-7502 - FAX: (202) 226-4301

Click Here To Contact Via E-mail

The UIGEA regulations will demand that banks block “unlawful internet gambling” but there is no definition of this vague term. Banks will be forced to block millions of transactions that are not in fact illegal. As a result, you may not be able to play poker or any other game of skill online. HR 5767 will prevent this regulatory nightmare. The King amendment will force the regulatory agencies to define “unlawful internet gambling” through a formal rulemaking, with due process and opportunity for input from affected parties.

Groups that oppose your right to play poker are working to defeat this important bill. Don’t count on someone else to take action for you – call today, there’s no time to waste!

Tennis Probe Finds 45 Suspicious Matches

We first talked about the story here. Chris Masse blogged the story here.

You can read the full update from Bloomberg here:

Tennis investigators found 45 matches in the past five years that need to be studied because of ``unusual betting patterns,'' the sport's governing bodies said.

The matches, identified in a study started in January, ``require further review to ascertain if they affected the integrity of professional tennis or if there were other tennis reasons for the outcome of the matches,'' the International Tennis Federation, the ATP Tour and the WTA Tour said in a news release.
…
Tennis had ordered the review to assess the threat posed by gambling after suspicious betting on a match involving fourth- ranked Nikolay Davydenko of Russia in August sparked an investigation. More than a dozen players said publicly last year that they were approached to throw matches and the men's ATP Tour suspended three Italian players for betting on matches.

Non-Farm Payroll (NFP) Predictions for April

Consensus: -78k
ADP: 10k

Last: -80k

DailyFX on the number:

Nearly everyone in the market seems to agree that non-farm payrolls will fall for the fourth month in a row, but will the job losses be more severe than what has been reported over the past 3 months? Job growth has been a sore point for the US economy for sometime and in March, the labor market reported its worst performance since March 2003. Analysts are currently looking for a mild improvement, but we believe that the conditions in the US labor market will worsen. In fact, non-farm payrolls could have even drop by 100k last month given the level of layoff announcements that have been announced.

NYT Flubs Deferred Prosecution Reporting

In one paragraph it is suggested that a deferred prosecution agreement would have been the best way to deal with Arthur Andersen:

The agreements, government officials say, also avoid the type of companywide havoc seen most acutely in the case of Arthur Andersen, the accounting firm that was shuttered in 2002 after being indicted in the Enron scandal. The firm’s collapse threw 28,000 employees out of work.

What the NYT doesn’t mention is that Arthur Andersen should never have been prosecuted, but by the time their conviction was overturned the firm had collapsed. This was the definition of abusive prosecution, but during the rush to blame following the Enron scandal no one seemed to care. Basically, the DoJ thugs screwed up. According to the Supreme Court’s reversal:

The court found that the instructions were worded in such a way that Andersen could have been convicted without any proof that the firm knew it had broken the law or that there had been a link to any official proceeding that prohibited the destruction of documents. The opinion, written by Chief Justice William Rehnquist, was also highly skeptical of the government's concept of "corrupt persuasion"—persuading someone to engage in an act with an improper purpose even without knowing an act is unlawful.

So would have a deferred prosecution agreement been a better alternative? No, since AA didn’t do anything wrong in the first place.

The article then suggests that DPAs are get out of jail free cards.

Some lawyers suggest that companies may be willing to take more risks because they know that, if they are caught, the chances of getting a deferred prosecution are good. “Some companies may bear the risk” of legally questionable business practices if they believe they can cut a deal to defer their prosecution indefinitely, Mr. Khanna said.

The general theme of the article is that DPAs are corporate giveaways. Well they are, but not in the sense that the article puts it. DPAs give prosecutors a way to hand something back to their cronies and get credit for “wins” without winning anything. After all, why shut down a perfectly viable business when it’s so much better to extort it?

This is a classic Spitzer-tactic. Make accusations to back the accused into a corner, then cut a deal. The businesses involved can’t risk even a small chance of being shutdown, but that doesn’t matter to the prosecutors who won’t hesitate to claim victory regardless of the outcome. They get away with it because the prosecutors have no intention of following through with the expense of a trial, but the system is so stacked in their favor that they never have to.

Amazingly, the NY Times points out the Ashcroft scandal involving DPAs, but not the obvious conclusion: The biggest winners from DPAs are the prosecutors.

Non-Farm Payroll (NFP) Predictions for March

Consensus: -50k
ADP: 8k

Last: -63k

DailyFX on the number:

Now more than ever, the change in non-farm payrolls for the month of March will determine the outlook for the US dollar and US monetary policy. All but one of our leading indicators for non-farm payrolls point to another month of job losses, which means that a negative print alone will not be enough to drive the US dollar lower. The dollar has been rebounding in the days leading up to the non-farm payrolls report and interest rate expectations for the FOMC meeting at the end of this month are strongly skewed in favor of a 25bp versus 50bp cut. We have seen these expectations change on a dime in reaction to incoming economic data and given the fact that the non-farm payrolls report is the most market moving indicator for the US dollar, there is no question that a weak release could alter market expectations significantly.

Non-Farm Payroll (NFP) Predictions for February

Consensus: 30k
ADP: -8k

Last: -17k

The most recent fundamental releases have been coming out to the downside:

The consensus compiled by Thomson's IFR Markets indicates economists are expecting payrolls to have increased 25,000 and unemployment to have increased to 5 pct. Since the consensus was finalised last Friday, however, there has been a host of poor economic indicators released in the week.