This week the top story was that the Federal Reserve launched a new program named Operation Twist. To put this in my best southern accent, would y'all go borrow some money for something expensive like a house. What this does is make the interest rates for US Treasury Bonds very low, in fact to a record low. You should take advantage of this and investigate re-financing of your home if you have a mortgage. The first paragraph is from Vanguard. The last section is titled 56 years ago and shows how important it is for an investment to grow faster than the rate of inflation.
The topic of the last blog was that gold was expensive and should be avoided. Last week, the price of gold dropped by about 10% and ended the week at $1,637.50. This is not a buying opportunity and gold should be avoided. The reason for this drop included a significant cost increase to purchase and maintain a contract on gold.
The stock market is getting way too much help from the US Federal Government. You would think that the US stock market indexes would have gone up with this news from the Federal Reserve. Unfortunately, investors got stressed about why would the action be taken. Last week, the US stock market indexes went down the most since 2008. The week before, the US stock market indexes went up the most since 2009. It means that the US stock market is currently being driven by political forces rather than economic forces. Eventually, economic forces will reign supreme and political forces will go into the background.
Vanguard:
The economic data released this week were mixed, but long-term persistent troubles were enough for the Federal Open Market Committee (FOMC) to take additional steps in its efforts to boost the economy. On the housing front, existing-home sales increased, while new residential construction fell. The index of leading economic indicators grew, but at a slower pace. For the week ended September 23, the S&P 500 Index fell 6.5% to 1,136 (for a year-to-date total return—including price change plus dividends—of about -8.3%). The yield on the 10-year U.S. Treasury note fell 24 basis points to 1.84% (for a year-to-date decrease of 146 basis points).
Operation Twist, US Treasury Bonds = Very Very Expensive:
Last week the 10 year US Treasury Bond briefly reached a historically low level of 1.67%. This means that interest rates are lower now than the Great Recession, World War II, Korean War, Vietnam War, etc... The only reason it went this low was through the help of the Federal Reserve and is not sustainable.
What the Federal Reserve did was to tell investors to sell other stuff and buy US Treasury Bonds. Forget about all of the long term stuff like having an interest rate less than the rate of inflation, just focus on the short term that interest rates could go even lower.
So why are US Treasury Bonds more expensive as interest rates drop? The best way to illustrate this is to look at a 10 year bond at the interest rates of 3.5%, 7%, and 14%. Remember that US Treasury bonds have a known value at maturity and the cost to purchase it fluctuates with interest rates. For example, the ball-park cost to purchase a $1,000 10 year US Treasury bond with a 3.5% interest rate would be about $750, 7% interest rate would be about $500, while a 14% interest rate would be about $250. The lower the interest rate the higher the cost.
The reason for the statement that US Treasury Bonds are expensive is because the cost to buy these bonds is unusually high. As interest rates go up to more normal levels the value will go down and if you sell it before the maturity you will lose money. If you hold it and the inflation rate is higher you will lose. Yes you can lose money on US Treasury Bonds.
56 years ago:
The following comments were made in the year 1955! That’s only 56 years ago. Imagine what things are going to be like 56 years from now in 2067!
• “If cigarettes keep going up in price, I’m going to quit - 20 cents a pack is ridiculous.”
• “Drive-in restaurants are convenient in nice weather, but I seriously doubt they will ever catch on.”
• “Did you hear the post office is going to charge 7 cents just to mail a letter and also cancel the penny postcard?”
• “When I first started driving, who would have thought gasoline would someday cost 25 cents a gallon?”
• “I heard some scientists think it’s possible to put a man on the moon by the end of the century - ridiculous.”
• “Did you see where some baseball player signed a con-tract for $50,000 a year just to play ball?”
• “I never thought I’d see the day all our kitchen ap-pliances would be electric. They are even making electric typewriters now.”
• “I’m afraid the Volkswagen car is going to open the door to a whole lot of foreign business.”
• “There’s no sense going on short weekend trips any-more. It costs nearly $2.00 a night to stay in a hotel.”
• “No one can afford to be sick anymore. At $15.00 a day in the hospital, it’s too rich for my blood.”
• “30 cents for a hair cut, forget it.”
Sunday, September 25, 2011
Saturday, September 17, 2011
Investing in Gold, Gold = Very Expensive
The topic is the current status of investing in Gold. My personal view is that it was expensive a long time ago and should be avoided, I will share the data. At the end is s short story titled Bubba's Loan for your enjoyment.
Vanguard
Consumers grew more cautious in August amid wild stock market swings, zero job growth, and heightened concerns the economy had weakened. While business inventories and industrial production climbed, retail sales were flat as consumer prices rose higher than expected. For the week ended September 16, the S&P 500 Index rose 5.4% to 1,216 (for a year-to-date total return—including price change plus dividends—of about -1.9%). The yield on the 10-year U.S. Treasury note rose 15 basis points to 2.08% (for a year-to-date decrease of 122 basis points).
Investing in Gold, Gold = Very Expensive
The value of Gold is all around us and a common question is should I be investing in it? It can be seen in advertisements for selling old jewelry and paid endorsements. I keep making reference to Gold as being part of the investing Tug of War with it being on the opposite side with Treasury Bonds against Stocks. Gold is a commodity that has a value strictly based upon buyers and sellers with no underlying basis.
Historically, Gold has grown at a 5% per year rate. The value of Gold in September 2001 was about $300 per ounce. So if Gold was grow at the historical rate of 5% it would be worth about $450 per ounce. The value of Gold last Friday was about $1,800 per ounce. I believe that Gold is about 4 times more expensive than it should be and the price has been driven up by political forces and the news media. I am concerned about something that is 4 times the level that I can correlate back in time.
In today's Barron's magazine on page M54, a chart shows the price of Gold and the relative price of an index of Gold minig stocks. So while Gold has risen about 40% in value during the last year the value of Gold mining stocks has grown only by 10%. This suggests a lack of confidence in the future price of Gold.
Bottom Line: While it is impossible to predict the price of Gold in the future, it is difficult to imagine it maintaining a growth rate that far exceeds it historic growth rate.
Bubba’s Loan
His name was Bubba - he was from Tennessee - he needed a loan. He walked into a bank in New York City and asked for the loan officer. He told the loan officer that he was going to Paris for an international redneck festival for two weeks and needed to borrow $5,000. He also pointed out that he was not a depositor of the bank. The loan officer noted that Bubba was wearing what would be considered his “Sunday go to meeting” clothes - bib overalls, U of TN sweatshirt and ball cap and formal black flip-flops.
The bank officer told him that the bank would need some form of security for the loan, so the redneck handed over the keys to a new Ferrari. The car was parked on the street in front of the bank. The redneck produced the title and everything checked out. Bubba did own the Ferrari and it was paid for. The loan officer agreed to hold the car as collateral for the loan and apologized for having to charge 12% interest.
Later, the bank's president and its officers all enjoyed a good laugh at the redneck from the south for using a $250,000 Ferrari as collateral for a $5,000 loan. An em-ployee of the bank then drove the Ferrari into the bank's private underground garage and parked it.
Two weeks later, the redneck returned, repaid the $5,000 and the interest of $23.07. The loan officer said, "Sir, we are very happy to have had your business, and this transac-tion has worked out very nicely. However, we are a little puzzled. While you were away, we checked you out on Dun & Bradstreet and found that you are a Distinguished Alum-ni from the University of Tennessee, a highly sophisticated investor and multi-millionaire with real estate and financial interests all over the world. What puzzles us is, why would you need to borrow $5,000?"
The good 'ole boy replied, "Where else in New York City could I park my car for two weeks for only $23.07 and ex-pect it to be there when I returned?"
Vanguard
Consumers grew more cautious in August amid wild stock market swings, zero job growth, and heightened concerns the economy had weakened. While business inventories and industrial production climbed, retail sales were flat as consumer prices rose higher than expected. For the week ended September 16, the S&P 500 Index rose 5.4% to 1,216 (for a year-to-date total return—including price change plus dividends—of about -1.9%). The yield on the 10-year U.S. Treasury note rose 15 basis points to 2.08% (for a year-to-date decrease of 122 basis points).
Investing in Gold, Gold = Very Expensive
The value of Gold is all around us and a common question is should I be investing in it? It can be seen in advertisements for selling old jewelry and paid endorsements. I keep making reference to Gold as being part of the investing Tug of War with it being on the opposite side with Treasury Bonds against Stocks. Gold is a commodity that has a value strictly based upon buyers and sellers with no underlying basis.
Historically, Gold has grown at a 5% per year rate. The value of Gold in September 2001 was about $300 per ounce. So if Gold was grow at the historical rate of 5% it would be worth about $450 per ounce. The value of Gold last Friday was about $1,800 per ounce. I believe that Gold is about 4 times more expensive than it should be and the price has been driven up by political forces and the news media. I am concerned about something that is 4 times the level that I can correlate back in time.
In today's Barron's magazine on page M54, a chart shows the price of Gold and the relative price of an index of Gold minig stocks. So while Gold has risen about 40% in value during the last year the value of Gold mining stocks has grown only by 10%. This suggests a lack of confidence in the future price of Gold.
Bottom Line: While it is impossible to predict the price of Gold in the future, it is difficult to imagine it maintaining a growth rate that far exceeds it historic growth rate.
Bubba’s Loan
His name was Bubba - he was from Tennessee - he needed a loan. He walked into a bank in New York City and asked for the loan officer. He told the loan officer that he was going to Paris for an international redneck festival for two weeks and needed to borrow $5,000. He also pointed out that he was not a depositor of the bank. The loan officer noted that Bubba was wearing what would be considered his “Sunday go to meeting” clothes - bib overalls, U of TN sweatshirt and ball cap and formal black flip-flops.
The bank officer told him that the bank would need some form of security for the loan, so the redneck handed over the keys to a new Ferrari. The car was parked on the street in front of the bank. The redneck produced the title and everything checked out. Bubba did own the Ferrari and it was paid for. The loan officer agreed to hold the car as collateral for the loan and apologized for having to charge 12% interest.
Later, the bank's president and its officers all enjoyed a good laugh at the redneck from the south for using a $250,000 Ferrari as collateral for a $5,000 loan. An em-ployee of the bank then drove the Ferrari into the bank's private underground garage and parked it.
Two weeks later, the redneck returned, repaid the $5,000 and the interest of $23.07. The loan officer said, "Sir, we are very happy to have had your business, and this transac-tion has worked out very nicely. However, we are a little puzzled. While you were away, we checked you out on Dun & Bradstreet and found that you are a Distinguished Alum-ni from the University of Tennessee, a highly sophisticated investor and multi-millionaire with real estate and financial interests all over the world. What puzzles us is, why would you need to borrow $5,000?"
The good 'ole boy replied, "Where else in New York City could I park my car for two weeks for only $23.07 and ex-pect it to be there when I returned?"
Sunday, September 11, 2011
Stocks = Value
I hope your day of remembrance has gone well and you have had a chance to enjoy the good things of life. This will be relatively short and will have 3 sections: Vanguard, Stocks = Value, and a true story called The Gingham Dress for your enjoyment. During the past 10 years the investment that has been impacted the most has been Stocks which makes them the investment that currently has the best value which is why I want every client to have a stock mutual fund.
Vanguard
Despite a few good signs, the market's mood turned grim as somewhat favorable reports on spending, trade, and service-sector growth were offset by higher new jobless claims and continued caution from Federal Reserve officials throughout the country. In remarks similar to those he made a few weeks ago, Fed Chairman Ben Bernanke said the central bank has a few more tools in the box to bolster the weakening economy. However, he didn't say whether he'd use them before the Federal Open Market Committee meets on September 20 to consider other measures to promote economic growth. For the week ended September 9, the S&P 500 Index fell 1.7% to 1154.23 (for a year-to-date total return—including price change plus dividends—of about -6.9%). The yield on the 10-year U.S. Treasury note dropped 9 basis points to 1.93% (for a year-to-date decline of 137 basis points).
Stocks = Value
As we all know, the long-term driver for stock price is corporate profits as profits go so does stock price. So in the 10 years what has happened to corporate profits and to stock price?
The Federal Reserve Bank of New York publishes information on publicly traded corporate profit and the chart is titled Corporate Profits with IVA and CCADJ. On September 2001, publicly held corporations had about $800 Billion in profits. The latest number on the chart is about $1,850 Billion in profits or about 2.3 times more.
The Saturday 9/10/2011 Wall Street Journal shows the value for the S&P 500 Stock Index for the last 10 years. The current S&P 500 stock index value is about $1,150. With corporate profits having grown 2.3 times you would think that the value of the S&P 500 index on 9/10/2001 would be much lower. Actually, 10 years ago the value of the S&P 500 index was a little less then $1,100, about the same. So while corporate profits have been growing at an average annual rate of about 9% the value of the S&P 500 index has barely moved.
So why am I still recommending that people buy a stock based mutual fund(s)? Because this is currently the investment that has the best value for a long-term investor.
The Gingham Dress
A lady in a faded gingham dress and her husband, dressed in a homespun threadbare suit, stepped off the train in Boston, Massachusetts and proceeded to the office of the President of Harvard University. The secretary could tell in a moment that such backwoods, country hicks had no business at Harvard.
“We'd like to see the president,” the man said softly. "He'll be busy all day," the secretary snapped. "We'll wait," the lady replied. For hours the secretary ignored them, hoping that the couple would finally become discouraged and go away. They didn't, and the secretary grew frustrated and finally decided to disturb the presi-dent, even though it was a chore she always dreaded.
"Maybe if you see them for a few minutes, they'll leave," she said. He sighed and nodded. Someone of his impor-tance obviously didn't have the time to spend with them, and he detested gingham dresses and homespun suits clut-tering up his outer office. The president, stern faced and with dignity, strutted toward the couple.
The lady told him, "We had a son who attended Harvard for one year. He loved Harvard and he was happy here. About a year ago, he was accidentally killed. My husband and I would like to erect a memorial to him on campus."
The president wasn't touched. He was shocked. "Ma-dam," he said, gruffly, "We can't put up a statue for every person who attended Harvard and died. If we did, this place would look like a cemetery." “Oh, no,” the lady explained quickly. "We don't want to erect a statue. We thought we would like to give a building to Harvard."
The president rolled his eyes. He glanced at the gingham dress and homespun suit, and then exclaimed, “A build-ing. Do you have any earthly idea how much a building costs? We have over seven and a half million dollars in the physical buildings here at Harvard." For a moment, the lady was silent. The president was pleased. Maybe he could get rid of them now.
The lady turned to her husband and said quietly, "Is that all it costs to start a university? Why don't we just start our own?" Her husband nodded. The president's face wilted in confusion and bewilderment. Mr. and Mrs. Leland Stanford got up and walked away, traveled to Palo Alto, California where they established the university that bears their son’s name, Stanford University, a memorial to a son that Harvard no longer cared about.
You can easily judge the character of others by how they treat those who they think can do nothing for them. A true story by Malcolm Forbes.
Vanguard
Despite a few good signs, the market's mood turned grim as somewhat favorable reports on spending, trade, and service-sector growth were offset by higher new jobless claims and continued caution from Federal Reserve officials throughout the country. In remarks similar to those he made a few weeks ago, Fed Chairman Ben Bernanke said the central bank has a few more tools in the box to bolster the weakening economy. However, he didn't say whether he'd use them before the Federal Open Market Committee meets on September 20 to consider other measures to promote economic growth. For the week ended September 9, the S&P 500 Index fell 1.7% to 1154.23 (for a year-to-date total return—including price change plus dividends—of about -6.9%). The yield on the 10-year U.S. Treasury note dropped 9 basis points to 1.93% (for a year-to-date decline of 137 basis points).
Stocks = Value
As we all know, the long-term driver for stock price is corporate profits as profits go so does stock price. So in the 10 years what has happened to corporate profits and to stock price?
The Federal Reserve Bank of New York publishes information on publicly traded corporate profit and the chart is titled Corporate Profits with IVA and CCADJ. On September 2001, publicly held corporations had about $800 Billion in profits. The latest number on the chart is about $1,850 Billion in profits or about 2.3 times more.
The Saturday 9/10/2011 Wall Street Journal shows the value for the S&P 500 Stock Index for the last 10 years. The current S&P 500 stock index value is about $1,150. With corporate profits having grown 2.3 times you would think that the value of the S&P 500 index on 9/10/2001 would be much lower. Actually, 10 years ago the value of the S&P 500 index was a little less then $1,100, about the same. So while corporate profits have been growing at an average annual rate of about 9% the value of the S&P 500 index has barely moved.
So why am I still recommending that people buy a stock based mutual fund(s)? Because this is currently the investment that has the best value for a long-term investor.
The Gingham Dress
A lady in a faded gingham dress and her husband, dressed in a homespun threadbare suit, stepped off the train in Boston, Massachusetts and proceeded to the office of the President of Harvard University. The secretary could tell in a moment that such backwoods, country hicks had no business at Harvard.
“We'd like to see the president,” the man said softly. "He'll be busy all day," the secretary snapped. "We'll wait," the lady replied. For hours the secretary ignored them, hoping that the couple would finally become discouraged and go away. They didn't, and the secretary grew frustrated and finally decided to disturb the presi-dent, even though it was a chore she always dreaded.
"Maybe if you see them for a few minutes, they'll leave," she said. He sighed and nodded. Someone of his impor-tance obviously didn't have the time to spend with them, and he detested gingham dresses and homespun suits clut-tering up his outer office. The president, stern faced and with dignity, strutted toward the couple.
The lady told him, "We had a son who attended Harvard for one year. He loved Harvard and he was happy here. About a year ago, he was accidentally killed. My husband and I would like to erect a memorial to him on campus."
The president wasn't touched. He was shocked. "Ma-dam," he said, gruffly, "We can't put up a statue for every person who attended Harvard and died. If we did, this place would look like a cemetery." “Oh, no,” the lady explained quickly. "We don't want to erect a statue. We thought we would like to give a building to Harvard."
The president rolled his eyes. He glanced at the gingham dress and homespun suit, and then exclaimed, “A build-ing. Do you have any earthly idea how much a building costs? We have over seven and a half million dollars in the physical buildings here at Harvard." For a moment, the lady was silent. The president was pleased. Maybe he could get rid of them now.
The lady turned to her husband and said quietly, "Is that all it costs to start a university? Why don't we just start our own?" Her husband nodded. The president's face wilted in confusion and bewilderment. Mr. and Mrs. Leland Stanford got up and walked away, traveled to Palo Alto, California where they established the university that bears their son’s name, Stanford University, a memorial to a son that Harvard no longer cared about.
You can easily judge the character of others by how they treat those who they think can do nothing for them. A true story by Malcolm Forbes.
Monday, September 5, 2011
JOBS
Happy Labor Day, I hope you enjoyed your time with family and friends. Labor Day is a celebration related to jobs something that is in the news constantly. The first section is from Vanguard. The middle section is on the job related metrics used by economists. Lastly is the rest of the information on the Tomb of the Unknown Soldier.
Vanguard
The long Labor Day weekend got off to a shaky start on Friday because of a weaker-than-expected report from the Labor Department, which indicated that the U.S. economy produced no net job growth in August. In other news, minutes from the Federal Open Market Committee's August meeting revealed that members were split over how best to help the economy. Meanwhile, consumer confidence hit its lowest point in more than two years last month. On a brighter note, consumer spending and factory orders both increased in July. For the week ended September 2, the S&P 500 Index fell 0.2% to 1,174 (for a year-to-date total return—including price change plus dividends—of about -5.4%). The yield of the 10-year U.S. Treasury note fell 17 basis points to 2.02% (for a year-to-date decrease of 128 basis points).
Job Statistics
The news on Friday was about 2 job statistic, the nonfarm payroll employment number and the unemployment rate. The data showed no change in nonfarm employment and no change in the unemployment rate. Three job metrics are typically given each month and I have given all 3 below. The bottom line of all these 3 metrics is that the economy is still in the recovery phase and job creation is going slowly as the Federal, State and Local governments are adjusting their workforce.
Nonfarm Payroll and Unemployment Rate
Nonfarm payroll employment was unchanged (0) in August, and the unemployment
rate held at 9.1 percent, the U.S. Bureau of Labor Statistics reported today.
Employment in most major industries changed little over the month. Health
care continued to add jobs, and a decline in information employment reflected
a strike. Government employment continued to trend down, despite the return
of workers from a partial government shutdown in Minnesota.
The ADP National Employment Report August 2011 Report
Private-sector employment increased by 91,000 from July to August on a seasonally adjusted basis, according to the latest ADP National Employment Report® released today. The estimated advance in employment from June to July was revised down modestly to 109,000, from the initially reported 114,000. According to today’s ADP National Employment Report, employment in the nonfarm private business sector rose 91,000 from July to August on a seasonally adjusted basis. Employment in the private, service-providing sector rose 80,000 in August, down from increases that averaged 115,000 per month over the prior two months. Employment in the private goods-producing sector rose 11,000 in August, while manufacturing employment slipped by 4,000.
UNEMPLOYMENT INSURANCE WEEKLY CLAIMS REPORT SEASONALLY ADJUSTED DATA
In the week ending August 27, the advance figure for seasonally adjusted initial claims was 409,000, a decrease of 12,000 from the previous week's revised figure of 421,000. The 4-week moving average was 410,250, an increase of 1,750 from the previous week's revised average of 408,500.
Tomb of the Unknown Soldier
• Their shoes are standard military issue with some mod-ifications. They are built up so the sole and heel are equal in height. This allows the Sentinel to stand with their back straight and perpendicular to the ground. A side effect of this is that the sentinel can “roll” on the outside of the build-up as they walk down the mat. This allows them to move in a fluid fashion. If done correctly their hat and bayonet will appear to not “bob” up and down with each step. This gives them a more formal and smooth look as they walk rather than a “marching” appearance. There is also a “clicker” built into the shoes. This is a shank of steel attached to the inside face of the heel. It allows sentinels to click their heels during certain movements. If done properly during the changing of the sentinels the click will be so perfect that it will sound like one click.
• Only eight words are spoken when the sentinels change. The sentinel being relieved will say to the relief commander and the replacement sentinel, “Post and orders remain as directed.” The relieving sentinel replies, “Orders acknowledger.”
• The average tour of duty for a sentinel is about a year. There is no set time for service. The sentinels live in a barrack at Ft. Myer, which is located adjacent to the Ar-lington National Cemetery. They can live off base if they prefer. There are also living quarters under the Arlington amphitheater where they stay during their 24-hour shifts. The sentinel guards are a special platoon within the 3rd U.S. Infantry Regiment.
• The Sentinel Identification Badge is awarded after a sentinel passes a special test and has served nine months. This Badge is a full size award, and is worn on the right pocket of their uniform jacket. This badge is the second rarest decoration awarded by the U S Army. (Only the Army Astronaut Badge is rarer.)
• Have there ever been any unusual circumstances at the Tomb? In 1984, a former government employee took the sentinel hostage with a handgun. In that situation the Tomb sentinels not on duty were alerted and proceeded to tackle the gunman from behind – no one was injured.
Vanguard
The long Labor Day weekend got off to a shaky start on Friday because of a weaker-than-expected report from the Labor Department, which indicated that the U.S. economy produced no net job growth in August. In other news, minutes from the Federal Open Market Committee's August meeting revealed that members were split over how best to help the economy. Meanwhile, consumer confidence hit its lowest point in more than two years last month. On a brighter note, consumer spending and factory orders both increased in July. For the week ended September 2, the S&P 500 Index fell 0.2% to 1,174 (for a year-to-date total return—including price change plus dividends—of about -5.4%). The yield of the 10-year U.S. Treasury note fell 17 basis points to 2.02% (for a year-to-date decrease of 128 basis points).
Job Statistics
The news on Friday was about 2 job statistic, the nonfarm payroll employment number and the unemployment rate. The data showed no change in nonfarm employment and no change in the unemployment rate. Three job metrics are typically given each month and I have given all 3 below. The bottom line of all these 3 metrics is that the economy is still in the recovery phase and job creation is going slowly as the Federal, State and Local governments are adjusting their workforce.
Nonfarm Payroll and Unemployment Rate
Nonfarm payroll employment was unchanged (0) in August, and the unemployment
rate held at 9.1 percent, the U.S. Bureau of Labor Statistics reported today.
Employment in most major industries changed little over the month. Health
care continued to add jobs, and a decline in information employment reflected
a strike. Government employment continued to trend down, despite the return
of workers from a partial government shutdown in Minnesota.
The ADP National Employment Report August 2011 Report
Private-sector employment increased by 91,000 from July to August on a seasonally adjusted basis, according to the latest ADP National Employment Report® released today. The estimated advance in employment from June to July was revised down modestly to 109,000, from the initially reported 114,000. According to today’s ADP National Employment Report, employment in the nonfarm private business sector rose 91,000 from July to August on a seasonally adjusted basis. Employment in the private, service-providing sector rose 80,000 in August, down from increases that averaged 115,000 per month over the prior two months. Employment in the private goods-producing sector rose 11,000 in August, while manufacturing employment slipped by 4,000.
UNEMPLOYMENT INSURANCE WEEKLY CLAIMS REPORT SEASONALLY ADJUSTED DATA
In the week ending August 27, the advance figure for seasonally adjusted initial claims was 409,000, a decrease of 12,000 from the previous week's revised figure of 421,000. The 4-week moving average was 410,250, an increase of 1,750 from the previous week's revised average of 408,500.
Tomb of the Unknown Soldier
• Their shoes are standard military issue with some mod-ifications. They are built up so the sole and heel are equal in height. This allows the Sentinel to stand with their back straight and perpendicular to the ground. A side effect of this is that the sentinel can “roll” on the outside of the build-up as they walk down the mat. This allows them to move in a fluid fashion. If done correctly their hat and bayonet will appear to not “bob” up and down with each step. This gives them a more formal and smooth look as they walk rather than a “marching” appearance. There is also a “clicker” built into the shoes. This is a shank of steel attached to the inside face of the heel. It allows sentinels to click their heels during certain movements. If done properly during the changing of the sentinels the click will be so perfect that it will sound like one click.
• Only eight words are spoken when the sentinels change. The sentinel being relieved will say to the relief commander and the replacement sentinel, “Post and orders remain as directed.” The relieving sentinel replies, “Orders acknowledger.”
• The average tour of duty for a sentinel is about a year. There is no set time for service. The sentinels live in a barrack at Ft. Myer, which is located adjacent to the Ar-lington National Cemetery. They can live off base if they prefer. There are also living quarters under the Arlington amphitheater where they stay during their 24-hour shifts. The sentinel guards are a special platoon within the 3rd U.S. Infantry Regiment.
• The Sentinel Identification Badge is awarded after a sentinel passes a special test and has served nine months. This Badge is a full size award, and is worn on the right pocket of their uniform jacket. This badge is the second rarest decoration awarded by the U S Army. (Only the Army Astronaut Badge is rarer.)
• Have there ever been any unusual circumstances at the Tomb? In 1984, a former government employee took the sentinel hostage with a handgun. In that situation the Tomb sentinels not on duty were alerted and proceeded to tackle the gunman from behind – no one was injured.
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