proem
PRO-uhm, -em
An introduction, preface, or preamble.
from Latin prooemium, from Greek prooimion, from pro- (before) + oime (song).
_____________________________________________
TIP OF THE WEEK
The proem on the future of the SBA is a one page overview
in the President’s budget request for the next fiscal year.
Only $987 million is being requested in discretionary
budget authority for 2024.
With less than a billion dollars, this will support
almost $58 billion in lending through mainly the SBA 7(a) and 504 loan programs.
_________________________________________
Indices:
PRIME RATE= 7.75%
________________________________________
SBA 504 Loan Debenture Rate for March
For 20 year debentures, the debenture rate is only 4.86%
but note rate is 4.931% and the effective yield is 6.338%.
For 25 year debentures, the debenture rate is only 4.93%
but note rate is 4.98% and the effective yield is 6.334%.
_______________________________________________
AHEAD OF THE YIELD CURVE
A proem for the Federal Reserve’s next meeting on interest
rates is the latest on jobs.
The Bureau of Labor Statistics reported that total
nonfarm payroll employment rose by 311,000 in February.
105,000 of those new jobs were in leisure and
hospitality. At the beginning of the
pandemic, in March and April of 2020, leisure and hospitality lost 8.2 million
jobs, and are now down 410 thousand jobs since February 2020.
So, leisure and hospitality has now added back about 95%
all of the jobs lost in March and April 2020.
US employment has largely returned to pre-pandemic levels
but this recovery hasn’t been even across the labor market.
You can use data from the Federal Reserve Bank of Saint
Louis to illustrate the recovery in employment according to establishment size:
1-19, 20-49, 50-249, 250-499, and 500+ employees.
Before the pandemic, employment across all establishment
sizes had been slowly increasing. Predictably, employment dropped in March 2020
for all size categories.
For the smallest establishments (1-19 employees),
employment dropped the least and recovered the fastest; however, employment in
these establishments has fallen slightly since the end of 2021.
For establishments with 20-49 employees, 250 to 499
employees, and 500+ employees, employment has followed a similar pattern,
increasing above employment levels from 2020.
For mid-range establishments with 50 to 249 employees,
employment dropped the most and recovered the slowest.
The smallest establishments obviously benefited from PPP
financial assistance
Here are the latest jobs numbers from the Bureau of Labor
Statistics.
February 311,000
January 504,000
2022 4,810,000
2021
7,270,000
2020 -9,370,000
2019 2,108,000
2018 2,679,000
2017 2,110,000
2016 2,160,000
2015 2,740,000
2014 3,116,000
2013 2,074,000
2012 2,193,000
2011 2,103,000
2010 1,022,000
2009 -5,052,000
2008 -3,617,000
2007 1,115,000
2006 2,071,000
2005 2,484,000
2004 2,019,000
What does all this mean?
I don't know.
One profligate propaedeutic has been that there is a
trade-off between jobs and inflation.
At last week’s auction of $18 billion in 30 year Treasury
bonds, the high yield was awarded at 3.877 percent, up from 3.686 percent last
month but down from a high of 4.080 percent in November.
Non-dealer bids accepted accounted for 91 percent of the
total, indicating excellent demand from investors.
On Tuesday, the Consumer Price Index will be released.
Core prices in February are expected to hold steady at an
elevated 0.4 percent monthly gain with overall prices also expected to rise 0.4
percent after January's 0.5 percent rise.
Annual rates, which in January were 6.4 percent overall
and 5.6 percent for the core, are expected at 6.0 and 5.5 percent.
On Friday, the Federal Reserve will report on capacity
utilization.
Last month capacity utilization dropped 0.1 percentage
point in January to 78.3 percent.
Neither of these reports should provoke procacious
proceleusmatics on the Federal Reserve’s next meeting March 21 and 22.
__________________________________________
OFF BASE
A glance at the Federal Reserve calendar of bank holidays
reveals the next day off is not until May 29th Memorial Day.
If that is too long, the following excuses could be used:
-St Patrick’s Day Friday March 17th
-Opening Day Major League Baseball March 30th
-Good Friday April 7th
