US Economy

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Previewing US jobs

Thanks to Calculated Risk: On Friday at 8:30 AM ET, the BLS will release the employment report for May. The consensus is for an increase of 180,000 non-farm payroll jobs in April, and for the unemployment rate to increase to 3.7%. Last month, the BLS reported 263,000 jobs added in April. Here is a summary

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US jobs preview

Via Calculated Risk: On Friday at 8:30 AM ET, the BLS will release the employment report for April. The consensus is for an increase of 180,000 non-farm payroll jobs in April, and for the unemployment rate to be unchanged at 3.8%. Last month, the BLS reported 196,000 jobs added in March. Here is a summary

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Has Powell withdrawn the “Fed put”?

Via Elliot Clarke at Westpac first: The April/ May FOMC meeting saw the Committee hold firm to their constructive but cautious view of the economic outlook. That inflation’s underperformance of the 2.0%yr medium-term target was highlighted in the decision statement initially supported market pricing of rate cuts in late-2019 and 2020. However, in the press

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Has the Fed set a “dove trap”?

Via Tim Duy at FedWatch: The Federal Reserve quickly switched gears between December 2018 and March 2019 as policy became “patient” and the two rate hikes projected for 2019 fell to zero. The backdrop for the shift was stumbling markets, softer growth data, and falling inflation. Fed officials find the turnaround of inflation particularly worrisome.

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Bernie Sanders leads Democrat fundraising

Via the FT: Bernie Sanders, the Vermont senator who fought Hillary Clinton for the Democratic nomination in 2016, led the field of 18 Democrats in the first quarter of the year by raising $18m, according to the Federal Election Commission. He was followed by Kamala Harris, the California senator, who raised $12m in the first

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Bernie Sanders runs amok on Fox

Via The Guardian: At every turn they clapped and cheered, enamored with the candidate’s prescriptions for universal healthcare, a humane attitude toward immigrants and the rejection of climate change denialism. Bernie Sanders was the candidate, and the people clapping and cheering were audience members who turned out in Bethlehem, Pennsylvania, for a televised town hall on

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US jobs preview

Via Calculated Risk: On Friday at 8:30 AM ET, the BLS will release the employment report for March. The consensus is for an increase of 170,000 non-farm payroll jobs in March, and for the unemployment rate to be unchanged at 3.8%. Last month, the BLS reported 20,000 jobs added in February. Here is a summary

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US growth exceptionalism not over

Via FTAlphaville: For most of 2018, US assets were exceptional. Thanks to a hefty dose of fiscal stimulus from the Trump administration, the economy surged at a time when growth elsewhere was slowing down. And when the Fed moved to further tighten monetary policy — as the likes of the ECB and BOJ held firm —

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Will the Fed cut interest rates?

Via S&P: Fed Will Cut Rates If 10-Year Yield Breaks Under 2.4% The Treasury bond market was stunned by the drop in the Federal Open Market Committee’s “dot chart” projection for year-end 2019 fed funds’ midpoint from the 2.875% of December 2018’s projection to 2.375% as of March 2019’s projection. Moreover, the FOMC formally announced

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Here’s a Black Swan for ya: Trump does MMT

The Economist tackles MMT today: That perspective is not always clear; there is no canonical mmt model. But there are some central ideas. A government that prints and borrows in its own currency cannot be forced to default, since it can always create money to pay creditors. New money can also pay for government spending;

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Previewing US jobs

Via Calculated Risk: On Friday at 8:30 AM ET, the BLS will release the employment report for February. The consensus is for an increase of 178,000 non-farm payroll jobs in February, and for the unemployment rate to decline to 3.9%. Last month, the BLS reported 304,000 jobs added in January. Here is a summary of

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El-Erian: US growth leadership to persist

Via Reuters: “People are underestimating how quickly Europe is slowing,” El-Erian said. The International Monetary Fund revised down its forecast for euro zone growth to 1.6 percent in January from 1.9 percent three months prior, but El-Erian thinks even the lowered outlook is overly optimistic. El-Erian, the former chief executive of Pimco, the bond investment

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Previewing US jobs

Via Calculated Risk: On Friday at 8:30 AM ET, the BLS will release the employment report for January. The consensus is for an increase of 158,000 non-farm payroll jobs in January (with a range of estimates between 140,000 to 183,000), and for the unemployment rate to be unchanged at 3.9%. Last month, the BLS reported

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Trumps tax cuts trickle into nothing

by Chris Becker As US stock markets recover from the December rout, even as the Trump shutdown rolls into its 29th day, it’s critical to look at what goosed the S&P500 to its previous highs before this latest correction. A year into Trump’s presidency and the US economy was sailing along if measured by lower

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US student debt hinders home ownership

by Chris Becker The US Federal Reserve as an interesting report out (unlike the US government, Trump can’t shutdown the Fed! on the impact of student debt on new homeowner rates in the US. Salient because the Coalition wants the education cake and to eat it too. Last year the Senate passed the HECS/HELP adjustments

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Could Trump’s shutdown push US into recession?

by Chris Becker The record US government (partial) shutdown moved into its 25th day overnight, with both sides digging in as Senate Leader McConnell blocked another continuation vote in the Senate to re-open the government. The impact is being felt at a micro level by the near 1 million US government employees who haven’t been

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Is the Trump shutdown coming to a close?

by Chris Becker It’s been nearly three weeks since Donald Trump shutdown the US Federal Government over his intransigence to fund a “wall”, even though one already exists across most of the US-Mexico border. Equity markets leading up to the shutdown were in a tailspin with the Dow down nearly 3000 points or a little over

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Sell gold! Or why the US dollar is not going to weaken

Via Bloomie: The U.S. dollar may be poised to decline, according to Goldman Sachs Group Inc. Comments from Federal Reserve Chairman Jerome Powell on Friday boosted the chances that the central bank will pause interest-rate increases, strategists at Goldman wrote in a note Saturday. Powell cited the events of 2016, when rates were kept unchanged through

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US jobs report preview

From Calculated Risk: Note: The Employment report will be released as scheduled, and not postponed by the government shutdown. On Friday at 8:30 AM ET, the BLS will release the employment report for December. The consensus is for an increase of 180,000 non-farm payroll jobs in December (with a range of estimates between 160,000 to 200,000),

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When will the Trump shutdown end?

by Chris Becker As adult supervision returns to Congress (but not the Senate) on January 3rd, the US Government shutdown rolls on with news this morning that President Trump has invited the new Congressional leadership to the White House. From The Hill: Trump will host the leader and whip of each party from both chambers,

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US Treasury secretary reassures markets again

Via CNN: In a precautionary move, Treasury Secretary Steven Mnuchin spent Sunday on the phone speaking with the chief executives of some of the country’s largest banks to avoid yet another market whiplash when Wall Street opens Monday, according to a person familiar with the matter. The secretary, who has been visiting his children in

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When will the Fed blink?

Via Ambrose Evans-Pritchard: Monetary tightening by central banks is like trying to pull a brick across a rough surface with elastic: nothing happens; still nothing happens; then it leaps up and hits you in the face. The US Federal Reserve’s Jerome Powell may have a broken nose after asserting stubbornly this week that he would

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Does the US have a new housing bubble?

“No” is the short answer, via Calculated Risk: Last Friday, Professor Robert Shiller wrote in the NY Times: The Housing Boom Is Already Gigantic. How Long Can It Last? We are, once again, experiencing one of the greatest housing booms in United States history. How long this will last and where it is heading next are

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Goldman doves up on Fed, lifts AUD

And so it begins, from Goldman which has been far too hawkish this cycle all along: Relative to the turmoil in the financial markets, the economic numbers have been remarkably stable recently. Admittedly, jobless claims have risen and November payrolls fell somewhat short of expectations. But a report showing 155k new jobs and a decline

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US jobs preview

Via Calculated Risk: On Friday at 8:30 AM ET, the BLS will release the employment report for November. The consensus is for an increase of 190,000 non-farm payroll jobs in November (with a range of estimates between 140,000 to 220,000), and for the unemployment rate to be unchanged at 3.7%. Last month, the BLS reported