Daily Archives: Mar 5, 2014 at 02:53 pm EST

ADP: Sluggish Growth For Private Payrolls In February

New jobs in the private sector increased by a disappointing 139,000 last month, according to today’s ADP Employment Report for February. The consensus forecast via surveys of economists expected 150,000, although The Capital Spectator’s econometric projection anticipated a lesser gain, albeit one that turned out to be too low relative to the actual number. In any case, the labor market is still expanding at a comparatively weak pace by the standards of the past year or so. Although February’s advance was a bit faster than the increase for January, that’s only because of ADP’s downward revision for the first month of the year in today’s update.
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The Illusion Of “Investing”

The term “investing” is a misnomer when it comes to managing money. It’s really a job of choosing a set of risk factors that will produce an expected result. Most folks don’t think in these terms, but the reality of “investing” boils down to a basic framework: select assets today on the assumption that a particular outcome will arrive tomorrow. The details, of course, matter, which is to say that not all assumptions are created equal. One that’s on the short list is the belief that reversion to the mean endures when it comes to returns. Buy low, sell high, as they say, because returns are always fluctuating. History exhibits a long and deep pool of empirical evidence for thinking that a mean-reverting process dominates price behavior in financial and commodity markets through time. Embracing this idea in real time, however, is devilishly difficult, which helps explain why so many investors find it tough to earn a satisfying return over one or more business cycles. The trap of buying high and selling low, in sum, is never far.
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