Tag Archives: Economic data

When Life Gives You Lemons…

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I think we all admire people who are able to turn a difficult situation into something enjoyable. The good news story of the week illustrates that principle.

Yesterday Steven Hayward posted an article at Power Line Blog that illustrates one aspect of the coronavirus lock-down that most of us had not considered.

The article reports:

But no, by far the the best stand-up-and-cheer-for-‘Murica story this week is “Team Allegedly Sets New ‘Cannonball Run’ Record on Empty Highways During Coronavirus Lockdown.” Now that’s making the best of the bad situation, American-style! Me, I’m getting three weeks to the gallon on my car right now, and so admire and envy the lust for speed on the open road.

But it sets me to wondering whether the American economy will put the pedal to the metal when the lockdown ends, such that we’ll experience an economic Cannonball Run. We’re in uncharted territory, but unfortunately I wouldn’t bet big on a big boom coming out the other side.

Let’s consider one tiny bit of microeconomic data, and one bit of lagging macroeconomic data, that ought to make us worry. The microeconomic data is my own monthly credit card statement. For the first time in my life, I’m looking forward to getting my monthly credit card statement later this month. I’ve been too busy to check online, but I expect I’ll have a credit balance for the first time ever, on account of all the plane fights and hotel rooms I’ve had canceled and refunded over the last month, on top of the restaurant meals I’m not having and other retail purchases. I’m not even buying many books at the moment, since Amazon and other online sellers are delaying book shipments in favor of more urgent items (though for me, what could be more urgent than another book?).

Unfortunately the article ends on a discouraging note:

The point is, even if 80 percent of the pre-crisis economy comes back by mid-summer, you’re still looking at a major recession, if not a near depression. Mauldin, by the way, has been predicting for the last couple years that a recession would see the federal budget deficit soar to $2 trillion. Now that would be regarded as “the good old days.” This year’s federal budget deficit is more likely to be over $4 trillion. And that may be optimistic.

I am hoping he is wrong. What we may see is a slingshot effect–people who have been holding on to their money because of uncertainty may feel comfortable spending some of what they have been holding on to. There will also be the desire to get out of the house–go anywhere! The American economy is consumer driven. If the consumers come out of hiding when the lock-down ends, I believe the economy will recover by the fall. I am also hopeful that various areas of the economy will begin to open up in the very near future. A lot of what has gone on under this pandemic is illegal under the U.S. Constitution. The thing I fear more than an economic downturn is the precedents that are being set that may pave the way for limiting the God-given rights of Americans.

It’s Hard To Remove A Sitting President When The Economy Is Good

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It is hard to remove a sitting President when the economy is good. That rule applies to attempts to impeach the President, and the rule also applies to elections. One impact of a strong economy is that people who are making good money and feel relatively secure in their jobs are less likely to engage in class warfare. Class warfare is one of the Democrat’s most frequently used weapons.

Yesterday One America News posted an article about the current state of the American economy.

The article reports:

The latest macroeconomic data is suggesting the chances of a U.S. recession have reduced in recent weeks due to steady consumer spending. According to a recent poll by Morning Consult, consumer confidence has rebounded over the past four weeks due to ongoing job creation, gains in wages and a soft price inflation.

Even without a resolution of the trade negotiations with China, consumers are feeling confident.

The article concludes:

Retail sales have also increased going into the holiday shopping season, beating previous expectations. Consumer spending makes up for roughly 70 percent of America’s GDP growth. Many experts have tied the ongoing stable expansion to President Trump’s economic policies.

“I think on the whole, this economy has been remarkable. It’s taken the headwinds of the trade wars pretty successfully…and we’re still chugging along at roughly two percent. I think that’s an accomplishment.” – Douglas Holtz-Eakin, President of the American Action Forum

A separate report from S&P Global found the probability of a U.S. recession in the coming year has dropped from 35 to 30 percent since August of this year.

I personally would like to see the probability of a U.S. recession at 0 percent, but I don’t know if I would trust the media to report that number even if it occurred.

The Economic Numbers Under President Trump

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Steve Moore posted an article at Fox Business on Thursday about the economy under President Trump.

The article includes the following:

The article explains:

In one Washington Post piece, the reporter sneers of Trump’s “rambling distortions” and complains: “Trump’s numbers appear to have originated in a pair of columns from the Heritage Foundation’s Steve Moore, who used research from a private firm called Sentier Research.”

Stop right there. Yes, it is true the data comes from Sentier Research — a private firm. But what is not ever mentioned in the article is that the data come from the Census Bureau’s “Current Population Survey,” which is the gold standard of economic data.

The article concludes:

In my analysis on these numbers, I have openly admitted these monthly data are a first rough estimate of what is happening with incomes over time — just as the jobs numbers are. They catch the trends over time.

Three years into the Trump presidency there is no calamity and there is no recession. Trump is right to recite real and legitimate data that substantiates the on-going middle-class boom in America today. It isn’t Trump, but his accusers who are engaged in “rambling distortions” and who deserve Pinnochio noses.

The questions for the 2020 elections are: “Do you want your income to continue to grow, and do you want to keep more of what you earn? How much of the money you have earned are you willing to give to people who did not earn it?”

Good News For Working Americans

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Breitbart posted an article today about the latest economic numbers.

The article reports:

The U.S. economy created 136,000 jobs in September and the unemployment rate fell to 3.5 percent.

Economists had expected the economy to between 120,000 and 179,000 with the consensus number at 145,000, according to Econoday. Unemployment was expected to remain unchanged at last month’s 3.7 percent.

The jobs data for the two previous months were also revised upward, indicating that the labor market was stronger over the summer than previously indicated. Employment for July was revised up by 7,000 from 159,000 to 166,000, and August was revised up by 38,000 from 130,000 to 168,000. With these revisions, employment gains in July and August combined were 45,000 more than previously reported.

The stronger numbers for July and August may also explain the slightly-below expectations figure for September since some of the growth in employment forecast for last month had already occurred.

The last time the rate was this low was in December 1969, when it also was 3.5 percent.

Economic data has been intensely scrutinized this week for signs of economic sluggishness after the Institute for Supply Management’s survey of manufacturing companies suggested the manufacturing sector had unexpectedly contracted for a second consecutive month. Survey data of non-manufacturing companies, however, showed that the services sector continued to expand in September. Similarly, data on private payrolls and unemployment claims suggested that the U.S. economy had cooled but was not near a recession.

The September workforce participation rate remains unchanged at 63.2 percent. This is a chart showing changes in the rate since 2009:

We Have Seen This Play Before

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The American economy is based on consumerism. Americans buy things and the economy continues. It is a rather delicate balance that can be manipulated for political purposes. We are currently watching an attempt to manipulate that economy for political purposes–President Trump’s strongest positive for re-election is the impact his administration has had on the economy. If the Democrats can ruin the economy, they might have a chance to win the presidency in 2020. After watching their behavior for the past two years, I am not surprised by any tactic they might use. So how are the Democrats and their friends in the media attempting to impact the economy?

The Associated Press reported today:

The threat of a recession doesn’t seem so remote anymore for investors in financial markets.

The yield on the closely watched 10-year Treasury fell so low Wednesday that, for the first time since 2007, it briefly crossed a threshold that has correctly predicted many past recessions. Weak economic data from Germany and China added to recent signals of a global slowdown.

That spooked investors, who responded by dumping stocks, sending the Dow Jones Industrial Average into an 800-point skid, its biggest drop of the year. The S&P 500 index dropped nearly 3% as the market erased all of its gains from a rally the day before. Tech stocks and banks led the broad sell-off. Retailers came under especially heavy selling pressure after Macy’s issued a dismal earnings report and cut its full-year forecast.

The article goes on to list things that the writer is convinced are evidence of an imminent recession. But let’s step back a minute. The American economy is cyclical. We have been in a growth spike for the past two years due to tax cuts and deregulation. Those factors are not changing. Unemployment is at historic lows. There are more jobs than workers. There is no evidence of that changing. We might be due for a correction in the stock market, but it’s not time to panic.

This tactic has been used before. In 1990, President George H.W. Bush agreed to a tax bill with the Democrats. The agreement broke his pledge of ‘no new taxes’, but it also did something else. The tax increase on luxury items worked its way through the economy causing a recession. Workers in industries making ‘luxury items’ lost their jobs are sales of these items decreased due to the tax increases. As those workers lost their jobs, they stopped going out to dinner, traveling, and doing the things that people do when economic times are good. People in service industries and tourism lost their jobs. The impact trickled through the economy, and we were in a recession. We were coming out of the recession during the campaign, but the media failed to note that.

In the coming days, watch for a media narrative of ‘the sky is falling’. That narrative will be in play for the next year in order to convince American voters to vote Democrat.

The only way to crash this economy is to panic the public. Large investors in the market with a political agenda can begin that process. The media can fan the flames.

The fundamentals of the American economy are strong. If Americans refuse to play along with a media-created financial panic, all will be well.

The Power Of The Media Illustrated

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This is the current polling from RealClearPolitics:

This is some recent economic news reported by The Washington Times on January 9:

Given the dazzling December economic data, it’s no wonder the press gave it short shrift. According to the U.S. Bureau of Labor Statistics, the economy added a whopping 312,000 jobs, far more than the expected 176,000. After revisions, job gains have averaged an impressive 254,000 per month over the past three months. Job growth in 2018 (an average of 220,000 per month) passed that of both 2016 (195,000) and 2017 (182,000). Payrolls increased by 2.6 million in 2018, the highest since 2015.

The sunny jobs picture encouraged 419,000 new workers to enter the workforce and sent the labor force participation rate up to 63.1 percent. Unemployment rates among blacks, Latinos and women are at or near historic lows.

Job growth has also meant significant wage growth. Wages are up a stunning 3.2 percent from last year and .4 percent from November. December was the third straight month that the yearlong growth in nominal average hourly earnings was above 3 percent in nearly a decade; the last time we saw that trend was April 2009. Wages are also being given an assist by inflation being kept in check.

The article at The Washington Times concludes:

His (President Trump’s) astounding economic track record is their worst nightmare. It puts the lie to the nonsense Mr. Obama, the Democrats and the media have been shoveling for years: That anemic economic growth, high unemployment, the collapse of manufacturing and grotesque trade imbalances were the “new normal.”

It also pointedly demonstrates that the statist vision — radical wealth redistribution, socialized medicine, green energy chimeras, social justice enforcement, limits on free speech, private property and gun ownership, and the rule of the leftist mob — creates only tyranny, poverty, injustice and servitude. (Note the deflection: These are things the left claims to want to eradicate.)

Mr. Trump and his economic thunderbolt are exposing the left and its policies as irredeemably bankrupt, economically and morally. And that is perhaps the biggest reason why they must try to destroy him.

A lot of this economic news has not been reported. However, people do notice when there are more jobs available and there is more money in their paycheck. President Trump’s approval numbers are finally in positive numbers. The economy is booming. What would be the basis for most Americans believing America is headed in the wrong direction? Might it be the constant negative reporting from the media? Can you imaging what President Trump’s approval rating would be if the media were actually balanced? Just remember–the people vote. The media represents only a small percentage of votes.

Even The Census Bureau Is Fudging Numbers

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Yesterday the New York Post reported that workers in the Census Bureau in the Los Angeles area have been have been manipulating the economic data.

The article reports:

Contact information for the veteran Census worker — who reached out to me by e-mail recently and whom I interviewed by phone — has been turned over to congressional investigators who are looking into data falsification in other parts of the country.

“Everybody knows falsification is going on,” the whistleblower told me, adding the malfeasance in the LA region is so obvious that it’s hard to miss.

She said she’s coming forward now because she “applauds” the others who have spoken up already.

Census employees have blown the whistle on the Denver and Philadelphia regions. A Denver whistleblower recently turned over information to the House Committee on Oversight and Government Reform.

Part of the problem here is that Americans have evidently grown tired of answering surveys and have become very wary of anything that might invade their privacy. Meanwhile, some of the Field Service Areas (FSA’s) are reporting a 100 percent response to their surveys–something that is highly unlikely at any time.

Why does this matter? Aside from the obvious fact that our government is lying to us, why is this important?

The article explains:

The stakes are high, of course. The Bureau of Labor Statistics requires a 90 percent success rate for interviews that go into the Current Population Survey, which Census conducts on BLS’ behalf. It’s those results that are used to calculate the nation’s monthly unemployment rate.

“To be perfectly honest, the BLS should be questioning the data, not just you alone,” the LA whistleblower said.

Who knows what the real unemployment rate actually is.