"It's not who you are that holds you back, it's who you think you're not."
Author Unknown

Just a quick post here- I don't read NY Times often but this weekend I ran across an interesting article on one of the news aggregator sites about a report by small research firm called TrimTabs Investment Research. I've heard this name before so I decide to do a bit more DD on these guys- and I'll tell you I was quite impressed.

Their forecasting ability seems to be far superior to the numbers Bureau of Labor Statistics puts out each month. And here come the bad news- job growth according to these guys was firmly negative in February:

"TRIMTABS, which estimates employment growth using data from an online job index and an analysis of income tax withheld versus job creation rates, has been far more accurate than the Bureau of Labor Statistics. For example, in 2006, the government's initial estimates of employment growth came in at 1.52 million jobs. But the bureau revised that data upward in February 2007, for a total of 2.24 million. By comparison, TrimTabs' estimates of 2006 employment growth, using real-time data, totaled 2.39 million jobs. The firm reported those figures to clients contemporaneously. Last week, TrimTabs told clients it estimated that 77,000 jobs would be lost in February; Wall Street economists are calling for a gain of 30,000 for the month. Since October 2007, TrimTabs estimates, the economy has lost about 175,000 jobs, the first sustained employment drop since early 2003. Growing job losses naturally will contribute to a weakening consumer, whose ills will affect the overall economy. And the stock market is feeling this pain as well, in Mr. Biderman's view. "

And if you thought the labor numbers look bad- here is another piece of bad news which should come as a real surprise to anyone who visited my blog before :) - GDP growth is likely to be negative in Q1

TrimTabs calls its new measure the Consumer Spendables Indicator, and it sensibly includes these crucial sources of consumption cash: after-tax wages; after-tax income from nonwage sources, like capital gains, dividends, pensions, partnerships and self-employment; and net equity extraction from consumers' homes, either through property sales or mortgage refinancing.

FOR the first time since the fourth quarter of 2003, TrimTabs estimates, consumers will have less money to spend this quarter on a year-over-year basis. The firm expects this figure to fall 0.6 percent from the same period in 2007.

source- NY Times

So the punch line is still the same- stay safe out there- shorting is perfectly ethical- need ideas to short- go to my MSN Strategy Lab profile

skepticalcapitalist@gmail.com

P.S. Just to confirm credibility of the source- recently Goldman Sachs took a minority stake in the company

"Goldman Sachs has found TrimTabs' analysis very useful," Hudson Street Services Chief Executive Michael Sanders said in a statement. "We hope our new collaboration will help grow TrimTabs Investment Research activities."