MBA hiring freeze
data centers so back they never left
auto delinquencies . . . perfectly stable
stopping in Mexico on the way to China
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Riffing on themes: MBA hiring drought, data centers, China, and the Almighty Consumer
Riffing on themes.
MBA hiring drought
The share of MBAs still looking for jobs 3 months out is climbing:
The share of job-seekers has doubled, and in some cases, tripled from pandemic lows.
The Journal doesn’t offer any particular reasons as to why MBAs are rotting on the vine a bit longer than usual, but to Random Walk, this is White Collar Stagnation in action.
The truth is, though, is that the job-finder rate isn’t that much higher than prepandemic levels. Plus, it’s good to have a little slack in the labor market—otherwise, we’d have no juice left to squeeze.
Data center momentum is back
A few weeks ago, Random Walk mused about the curious downturn in the Dodge Construction Momentum Index.
As everyone knows, data centers are all the rage, and if the leading signals for data center construction appeared to be slowing, well . . . that would be different.
Rest assured, though, because in the latest read, Data Center momentum is back:
The index is up 19% yoy, with commercial construction planning driving the lift (up 30% yoy).
Data Centers are most definitely the prime mover:
On the commercial side, data center and warehouse planning drove much of the growth this month, while stronger healthcare and education activity supported the institutional portion. In December, the DMI was up 19% when compared to year-ago levels. The commercial segment was up 30% from December 2023, while the institutional segment was flat over the same period.
The influence of data centers on the DMI this year has been substantial. If we remove all data center projects in 2023 and 2024, commercial planning would be up 8% from year-ago levels, and the entire DMI would be up 5%.
Data Centers account for ~75% of the additional construction planning.
Turns out that November was just a blip😅.
Scoreboard says that demand for data centers is, as yet, insatiable.
The Almighty Consumer continues to be just fine
The auto-lender and insurance-broker extraordinaire, Ally Financial ALLY 0.00%↑, reported yesterday, and in so doing, bared its credit performance to the world.
When it comes to auto-loan delinquencies, Ally says “nothing to see here.”
30+ day delinquencies were a tad higher, 60+ days were a tad lower, and 90+ days were a tad higher.
That’s a pretty steady picture (and a good chunk of the poor performance dates back to 2022-vintage loans).
Plus, 2024 vintages are performing better (for now) than previous years:
30+ day DQ rate for the 2024 vintage is ~50bps lower than the prior years were at this point in their lifecycle.
That’s better than steady, that’s good.
The point is that while there’s been some choppiness in auto-delinquencies (especially for subprime), in the big scheme of things, the Almighty Consumer continues not to bite off more than it can chew, at least for now.
Breaking up with (China) is hard to do
BCG did a big thing on trade flows, and how they might change over the next few years.
It’s worth a skim, but this chart in particular caught my eye:
Expected flows between the US and China are expected to decrease substantially.
But . . . trade flows between the US and Mexico are expected to grow . . . and flows between China and Mexico are also expected to grow, and well, it’s probably a coincidence.
No way that Chinese imports are just taking a pitstop in Mexico first, right? That would be ridiculous.
Other links
Jamie Dimon says tariffs are good for national security, so ‘get over it.’ Did not expect that, ngl.
Trump freezes IRA disbursements. Reindustrialized shrugged?
Brookfield nears deal to buy Divvy homes for $950M. Well, that’s one big investor making single family acquisitions.
Stripe cuts 300 jobs, or 3% of workforce. The company is still growing headcount though. It also send the unlucky ones a picture of a duck.
Previously, on Random Walk
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Wonder if Mr. Dimon was visited by J.P. Morgan's ghost over the holidays?