Saturday, April 8, 2017

Jobs Numbers

Jobs numbers came in for the month. 98K new, much less than expected, with previous months revised down.

Is this the start of a slowdown, or just an oddball number?
Some say the low number is because employers can't find workers, so don't hire.
If we assume this latter answer is true, what does it mean?

Demand is still high for products and services? Yes?

Wages will go up? Yes?

Interest rates must rise? Yes?

Corporate profits under pressure? Yes?

President Trump wants infrastructure spending and to build his wall. Labor needed.

What does a rise in interest rates do to the oil industry? Junk bonds?

And this at a time when U.S. corporations await a tax cut, which if enacted would increase U.S. govt debt.

All of these types of things take time to play out, but from a big picture perspective could be game changing.

And our Federal Reserve seems intent on raising rates to show that they can, but with a very cautious stance.

Europe recovering? Oil recovering? Emerging markets?

Time to tread water? No firm choice. Wall of worry. Or change from decades of disinflation?

How well do paradigms change?


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