Another round of bailouts, totaling €130 billion, was approved for Greece on Tuesday. As with other Greek bailouts, the receipt of the money was contingent on further budget cuts and austerity. Going forward, Greece faces two main concerns, one short-term, and one long-term.

This week’s chart shows the historical unemployment rates for various education levels and their respective averages over the time period of 1992 - present. Despite the well publicized recent drop in the overall unemployment rate, the current unemployment rates for each education level still remain near their 20 year highs and around twice their 2007 pre-recession levels. Also, since the recession began, the unemployment rate for those with only a high school degree has been higher than the unemployment rate for the general population for the first time.

Domestic energy production has experienced a renaissance over the last few years, mainly driven by natural gas production. While oil prices hovered around $100/barrel for most of 2011 natural gas prices hit lows not seen since the 1990’s.

This week’s Chart of the Week chronicles Japan’s trade deficit over the last five years. In the graph, the red line represents Japan’s month-end trade balance, while the charcoal line is the 100-day moving average of the trade balance.

While traditional “active” consumer spending undoubtedly makes up a large percentage of G.D.P., increased spending on health care (through Medicare and Medicaid) over time has likely overstated this popular statistic.

This week’s Chart of the Week examines four types of loans and their delinquency rates over the past twenty years. A loan is considered to be delinquent if it is past due by thirty or more days. The delinquency rate is the percentage of loans that are considered to be delinquent.

Over the past five years, as globalization has become more pronounced and economies more intertwined, correlations have certainly increased to all time high levels. But since correlation does not capture magnitude of returns, investors should continue to utilize an asset allocation model that takes potential risk and return into account.

On Tuesday, the ISM factory index for December was released, with last month’s level reaching 53.9, the highest since April. Perhaps more importantly, this was above expectations of 53.5, thus providing an unexpected surprise to the upside to kick off 2012.

In the most recent November employment survey, the unemployment rate fell significantly further than expected, to 8.6%. This seeming improvement, however, masks continued weakness in economic growth. Calls for a U.S. recession now seem premature, but, so too do calls for a return to robust growth.

This week’s chart depicts the intraday percentage change of the S&P 500 index over the trailing ten years. Several outlying events have been highlighted, however, we will focus on 2011.

This week’s Chart of the Week deals with the sovereign debt crisis in Europe. It is an update of a Chart of the Week from January, 2011 when yields on Portuguese bonds were trending towards 7% and there was much speculation in the market that Portugal was in need of a bailout package from the EU. Since then, Portugal received a bailout package from the EU and IMF and the fiscal situation in Italy has become the focus of attention in the markets.

This week’s chart analyzes job growth after the last four recessions by examining employment levels 60 months after the start of each recession. The data focuses on private employment, not government employment. Ellipses on the chart represent the end point of each recession, whereas squares represent the beginning of job growth.

This chart looks at the drop and recovery in real personal income during recessions over the last 50 years (personal income is shown as a percentage of the previous peak to look at prior recessions on an apples-to-apples basis).

SIFIs are financial institutions deemed large and complex enough that their failure would cause ripple effects throughout the financial system. This week’s chart shows CDS spreads on SIFIs of select countries. For countries with multiple banks on the list, the average CDS spread of available data is taken.

The Purchasing Managers Index (“PMI”) attempts to gauge the health of the manufacturing sector in a given economy. As securities markets around the globe fluctuate wildly trying to predict the future path of global economies, this general economic indicator is flashing warning signs.

Given the fourth quarter U.S. stock market performance to date, we have been asked if certain quarters have historically offered more positive performance. Based on S&P 500 data from 1926 through 3Q2011, the answer seems to be yes, as there does appear to be some persistency across the four quarters.

Generally speaking, the new orders component serves as an indicator of future demand, while the inventories component serves as an indicator of current supply. Comparing new orders to inventories helps to illustrate the supply/demand dynamic within the manufacturing sector, which in turn can help provide insight into future economic activity. When demand (i.e. new orders) is greater than supply (i.e. inventories), it’s a sign of future economic growth. When demand is less than supply, it’s a sign of future economic weakness.

Developed Europe has some tough economic challenges ahead. Italy and Spain just had their credit ratings downgraded putting further pressure on banks holding sovereign debt from the PIIGS nations. While Greece may not be saved from default, European leaders have indicated their commitment to not let its major institutions fail without a fight.

With the global equity markets moving every day on the latest news of the European debt crisis - specifically the Euro-zone's handling of the Greek crisis - it is important to understand banks’ actual exposure levels (direct and indirect) to Greek debt. Direct exposure entails the outright holding of Greek promissory notes, while indirect exposure comprises derivative contracts, extended guarantees, and credit commitments.

Wild uncertainty in the equity markets coupled with European debt concerns have driven U.S. Treasury yields to all-time lows, and left income-driven investors searching for alternative sources of yield. While bonds will always serve as major component of an income-driven portfolio, the overarching low yield environment has led investors to look beyond the traditional sources of return.

Corporate profits as a percentage of employee compensation reflect the after tax profits of companies compared to the total compensation provided to American workers.  As this percentage increases, corporate profits are increasing relative to employee compensation.

Since 1980 the three most volatile cyclical components of GDP have been “change in private inventories”, “fixed investment in non residential structures”, and “fixed investment in residential structures”. While these three categories make up only 8% of GDP, they have historically accounted for almost 60% of any negative change in GDP during a recession.

Since the 1980’s until the most recent recession, the U.S. maintained relatively stable GDP growth.  However, this growth was not evenly apportioned.  During this time, income inequality increased, and labor’s share of output declined.

This week’s COW takes a look at the Volatility Index (“VIX”), defined by the CBOE as the measure of short-term stock market volatility conveyed by S&P 500 option prices. It is also known as the “markets fear index”, as VIX tends to rise when markets are falling. Although the VIX has been extremely volatile since the Financial Crisis of 2008, we chronicle the events of the last two months in an effort to further illustrate the dramatic equity market movements of summer 2011.

This week’s chart looks at the amount of excess reserves banks are holding at the Federal Reserve (orange line) along with the corresponding changes to the Federal Reserve’s balance sheet (black line). As of the end of July 2011, banks are holding over $1.6 trillion in excess reserves, which is notably higher than what historical averages would suggest. This has led some market commentators to worry about inflation escalating as banks begin to lend out those assets (note that overall loans and leases issued by commercial banks, as represented by the red line, have fallen since the Financial Crisis of 2008 – 2009).

With the dramatic movements in the stock market over the last few weeks, we feel it is important to look at the underlying sectors of the market to see how they are performing relative to one another and the market as a whole. This week’s chart examines the S&P 500 Index’s implied correlation as well as correlations among the various S&P 500 sectors.

This week’s chart examines the frequency and magnitude of market corrections in the U.S. equity market, as measured by the S&P 500 Index. A market correction is defined as a decrease of 10% or more within one calendar year.

This week’s Chart of the Week compares growth in nonfarm payrolls to real GDP growth. The year over year change in nonfarm payrolls (i.e. jobs created or lost) is plotted on the left axis, and year over year real GDP growth is plotted on the right axis. As the chart shows, job growth is highly correlated to GDP growth.

The Bureau of Labor Statistics (BLS) release of the U.S. unemployment rate each month generates a significant amount of attention; however, this headline number provides only a static view on the health of the labor market. Since reaching a high of 10.1% in October 2009, the unemployment rate is currently 9.2% through June 2011 and remains at elevated levels following the “Great Recession” of 2007-2009.

For all the press coverage of rising gold and oil prices, commodity prices during the first half of 2011 showed a tremendous degree of dispersion across different sectors. Silver saw the greatest increase in value as it rose by more than 12%, but wheat fell by more than 26%, thus creating a spread between best and worst of almost 40%.

With the August 2nd deadline fast approaching investors are increasingly wondering whether the U.S. might actually default on its debt obligations. In an effort to gain some insight into what the market is expecting, this chart looks at the pricing of Credit Default Swaps (CDS) on U.S. Government debt over the last year.

This chart depicts the ratio of U.S. exports of goods and services over U.S. imports of goods and services going back to 1960. This measure only looks at goods and services and does not factor in income receipts & payments with other nations.

There has been much discussion over the past several months regarding increasing the debt limit. Currently, the Treasury Department projects that the U.S. will exhaust its borrowing authority under the current debt ceiling on August 2, 2011. If politicians cannot come to an agreement in the coming weeks, the government could default on its legal obligations.

As many commentators have pointed out, over the past two years the BarCap Aggregate has seen a large increase in its benchmark allocation to treasuries. Since December 2008, treasuries as a percentage of the Agg have grown from 21% to 33%. This highlights a drawback of any bond benchmark based on issuance.

In an attempt to stimulate economic growth, the Federal Reserve (the “Fed”) has used multiple monetary policy tools in the past few years: reducing short-term interest rates to virtually zero, introducing numerous facilities to stabilize specific areas of the market, and implementing quantitative easing (“QE”) programs.

Last week’s chart addressed the increase in IPOs during 2011. In addition to the number of companies coming to market, the returns of these companies post-offering can also serve as an important metric.

As LinkedIn’s highly successful IPO commanded lofty valuations and headlines across the financial press, commentators began drawing parallels to the hot IPO market that preceded the tech collapse at the end of the last decade. Although it has likely been ten years since a new company listing has generated so much buzz, the state of the equity IPO market in the U.S. has a long way to go before reaching the levels seen in the late 1990’s.

There has been much discussion in the media about the improving conditions of the U.S. housing market. As the graph through April 30, 2011 indicates, the rate of new foreclosures is decreasing, the rise in number of significantly delinquent loans has tapered off, and residential construction spending appears to have bottomed out.

The Taylor rule, proposed by John Taylor, is a formula for determining the target Fed Funds rate. In the Taylor Rule, the Fed Funds rate baseline is set to the target nominal rate (target real rate plus target inflation), and then adjusted based on economic conditions. The rule states that the Fed Funds rate should be raised when inflation is higher than target inflation (“Inflation Gap”), and lowered when economic output is lower than potential output (“Output Gap”).

This chart illustrates the top ten holdings for the three indices that give investors broad exposure to the U.S. (S&P 500), Non-U.S. Developed Markets (MSCI EAFE) and Emerging Markets (MSCI Emerging Markets). The chart shows the market caps of each of the ten largest companies in the index and are listed from the largest weights (at the bottom) to the smallest weights (at the top).

The U.S. economy has strengthened substantially over the past several quarters, and at some point the Fed will have to begin removing excess liquidity and end the special programs it created to support the economy during the crisis. With the Federal Reserve’s second round of quantitative easing (QE2) set to expire in June, there has been much speculation about what will happen once QE2 comes to an end, and when the Fed will begin tightening monetary policy.

In aggregate, public pensions are approximately 75% funded (down from a high of 103% in 2000), but there is a great degree of dispersion of funding ratios on a state by state basis.

While the U.S stock market enjoyed an upward trajectory over the past 18 months, the U.S. housing market continues to experience its ups and downs. Enacted in the beginning of 2009, the American Recovery and Reinvestment Act provided a tax credit to home buyers. At the time, U.S home sales were in a freefall, but this credit helped reignite the market.

Although the broad economy has grown steadily since the beginning of 2009, the construction sector remains mired in a state of recession. Construction employment peaked at the end of 2006 as the housing bubble began its collapse. Currently, the unemployment rate of the construction sector stands at 21.8%.

As investors raise questions surrounding the prospects of both stocks and bonds as we head into the Summer, a useful exercise can be looking at the historical valuation of the two asset classes in relation to one another. A variation of Dr. Ed Yardeni’s Fed’s Stock Valuation Model can be used as a simplistic gauge of the relative valuation between the two asset classes.

The Fed recently completed its latest stress tests on banks. Based on the results, many banks were given the green light to increase dividend payouts as well as announce share buybacks. With this in mind, our chart of the week looks at the charge off rates and delinquency rates of loans at all commercial banks.

Over Monday and Tuesday of this week the Nikkei 225 (major Japanese stock market index) fell 16.1% – dropping from 10,254.43 on March 13th to close at 8,605.15 on Tuesday.

This week’s Chart of the Week shows the percentage changes in the Consumer Price Index and Unit Labor Costs (the average cost of labor per unit of output) since 1950.

This week's chart examines the peak employment level (total number of people working in the U.S. labor force), along with the time taken to return to that peak level after a recession.

As commodity prices around the globe continue their steady march upward, convention would suggest that inflation in the U.S. isn’t far behind. However, as many developing nations have already felt the sting of rising costs, inflation in the U.S. remains largely absent.