ADP Employment Report Shows Most Job Losses Since 1991

The ADP employment report for November showed that the private sector reduced their payrolls by 250,000 which were the most since November, 2001. Goods producing firms led by dropping 158,000 jobs as manufacturing activity has grinded to a halt. Indeed, the forecast for the Non-farm payrolls report is expected to show total job losses for the month at 325,000. However, given the private sector over shot its initial forecast by 45,000 the total losses could be greater.

U.S. Job Cuts Rise 148% Hitting a Six-Year High

Deteriorating fundamentals continues to reflect a dour outlook for the U.S. as job cuts surged 148.4% to 181,671 in November to reach its highest level in six years. Fading demands from home and abroad paired with the ongoing weakness in the credit market led businesses to cutback on employment, and conditions may only get worse as the world’s largest economy heads into a recession. Fading employment opportunities has certainly heightened the downside risks for growth, and may lead policymakers to step up their efforts over the following months in order to avoid a hard landing.

U.S. Mortgage Applications Surge 112% on Lower Borrowing Costs

U.S. mortgage applications surged 112.1% to 857.7 from 404.4 in the week ending November 21st as the Fed increased their efforts to stabilize the credit market. Last week, the central bank announced that that they will purchase up to $500B in mortgage-backed securities, and will also buy $100B of debt from Fannie and Freddie. The comments by policymakers helped to lower the average 30-Year Fixed Rate to 5.47 from 5.99, while refinancing jumped to 69.1% from 49.3%.

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