Revised 2nd quarter productivity slipped deeper into the red at -.6%. Unit labor costs increased sharply as the initial 2% rate more than doubled to 4.3% on much higher compensation costs. This marks a third quarterly decline in productivity something that hasn’t been seen since 1979.
Manufacturing data also slipped into the red as the August Institute of Supply Manufactures Manufacturing Index fell a larger than expected 3.2 points to 49.4 on weakness in new orders, production, employment and inventories. This reversal erases nearly all of the gains for this index since the beginning of the year.
The plunge in global trade volumes and shipping rates claimed its first major victim as the world’s 7th largest shipper Hanjin has declared bankruptcy, something that will disrupt global trade as its ships are being turned away at port and or impounded.
What to do when a thrice bailed out systemically significant European bank probe reveals sordid details. If you’re the investigators of Italy’s Monte Paschi you just shelve the investigation as once again too big to fail is too big to jail because the investigators concluded that continuing to look at the banks role in market manipulation and accounting fraud might reflect unfavorably on the bank, its executives and jeopardize the latest bailout. Once again there are two sets of rules one for the little people aka the 90% and one for the elites, aka the 10%, or is it 1%.
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