But Baby, I Can't Find No Job Money Goes Where It's Wanted By Christian A. DeHaemer

http://www.wealthdaily.com/articles/but-baby-i-cant-find-no-job/2734

Wednesday, September 22nd, 2010

There are one hundred men seeking security to one able man who is willing to risk his fortune.
— J. Paul Getty

It looks like we are two years into — and out of — the recession, and the job numbers just aren’t showing much improvement in the U.S.
The unemployment rate for July came in at 9.5%.
According to the Labor Department, private employers added a net total of only 71,000 jobs in July — far below the 200,000 or more jobs needed each month to reduce the unemployment rate.
A new report out today says that unemployment stands at 9.6%, while rates in some states like Nevada, Michigan, and California are higher than 12%.
All private workers
Here is a handy chart from the Bureau of Labor Statistics which shows total private employment (in thousands):

Year	Jan	Feb	Mar	Apr	May	Jun	Jul	Aug	Sep	Oct	Nov	Dec
2000	110210	110303	110641	110858	110738	110952	111135	111168	111392	111373	111587	111681
2001	111634	111624	111555	111227	111146	110910	110737	110544	110276	109918	109575	109368
2002	109214	109054	108989	108892	108814	108824	108732	108671	108659	108772	108758	108595
2003	108640	108484	108286	108252	108274	108233	108231	108266	108421	108570	108611	108724
2004	108882	108913	109213	109437	109747	109841	109883	109984	110135	110465	110493	110624
2005	110718	110949	111095	111441	111583	111847	112122	112311	112392	112492	112796	112934
2006	113232	113531	113803	113956	113988	114065	114223	114344	114401	114428	114616	114785
2007	114971	115050	115263	115328	115455	115497	115512	115403	115389	115454	115551	115574
2008	115562	115477	115419	115258	115005	114775	114518	114171	113715	113168	112434	111767
2009	110961	110254	109510	108861	108527	108075	107778	107563	107377	107115	107190	107107
2010	107123	107185	107343	107584	107635	107696	107803(P)	107870(P)
P: preliminary

It shows the boom in the late 1990s, the dot-com bust, followed by the housing boom starting in 2004, and the current bust... which seems to be ending in slow motion.
Now here are the numbers for government employees (in thousands):

Year	Jan	Feb	Mar	Apr	May	Jun	Jul	Aug	Sep	Oct	Nov	Dec
2000	20571	20599	20733	20802	21147	20887	20867	20837	20735	20743	20760	20804
2001	20835	20906	20945	20992	21029	21137	21185	21218	21242	21275	21326	21355
2002	21377	21390	21431	21443	21514	21549	21544	21589	21546	21559	21581	21588
2003	21626	21624	21610	21595	21567	21606	21633	21556	21504	21558	21535	21546
2004	21538	21550	21588	21614	21614	21601	21606	21626	21635	21656	21692	21693
2005	21735	21744	21740	21754	21781	21763	21857	21863	21845	21829	21859	21879
2006	21843	21870	21902	21923	21922	21914	21988	22008	22051	22067	22080	22088
2007	22096	22121	22147	22174	22196	22209	22174	22212	22278	22299	22330	22377
2008	22379	22414	22439	22451	22473	22510	22557	22570	22568	22561	22567	22561
2009	22588	22569	22560	22681(C)	22628(C)	22565(C)	22516(C)	22519	22480	22518	22507	22481
2010	22479	22456	22506	22578	22959	22723	22562(P)	22441(P)
C: corrected P: preliminary

You will notice a relentless climb in government workers over the past ten years.
The only slight dip is in November and December of 2009, and in July and August of this year.
This is a classic example of misallocation of resources.
And it reinforces my belief that in order to make money, you can’t invest in the United States...
The U.S. just spent $800 billion dollars on a stimulus package; the vast majority of this money went to the States in order to prop up their bloated bureaucracy.
It avoided service cuts for exactly one year and created a mountain of IOUs...
All it stimulated was debt.
This is money taken from the pockets of potential capitalists — who, as John Paul Getty quoted above, know how to take risks.
It's put in the hands of those who, by definition, sold their freedom for a union job and a desk at the State House.
The U.S. is on the same trajectory as Venezuela, where 55% of the population works for the government. They just vote for their own meal ticket while the smart and the rich flee.
I'm going back to Cali — hmm... I don't think so
The immortal words of LL Cool J are called to mind...
But companies aren't going to Cali. In fact they are leaving as fast as they can.
More than 100 large and mid-sized companies are leaving California for fewer taxes and less regulation in neighboring Utah and Nevada. These companies include eBay, Adobe, Buck Knives, American Racing, Yahoo!, and EA Games.
This is no small thing, and it will impact the Golden State for years to come.
Oil ban unemployment
As I write this, oil companies are packing up their rigs and heading to Africa due to Obama's across-the-board moratorium on oil drilling in the Gulf of Mexico.
The Wall Street Journal reports:

Numerous operators told U.S Interior Secretary, Ken Salazar that they were in the final stages of moving rigs, deepwater rigs out of the Gulf of Mexico and to West Africa and the Middle East.

The current rate for a floating drill ship is $417,495.05 a day, which is a lot cheaper than it was a two years ago....
But it's not the type of money you want to eat on a daily basis for six months — especially since there is no guarantee that the ban will be lifted.
Later, Uncle Sam
Money goes where it is treated the best. And that's not the United States. Not anymore...
A poll by Bloomberg this week says, “The U.S. has fallen behind emerging markets in Brazil, China and India as the preferred place to invest.”
I would take it a step further and go beyond the standard BRIC countries that we've been hearing about for the past ten years.
Don't get me wrong; there is plenty of money to be made in today’s world.
And you can grab your fair share.
I’m looking at some interesting equities in the Middle East that trade on the New York Stock Exchange. I found a sweet undervalued oil explorer with a major find off the coast of Guyana that could be my next 905% winner.
That's all for now — I've got to catch a train to New York City.
Just remember, when you punish money... it goes away.
Have a good one,
Christian DeHaemer
Wealth Daily