Down 501K in March. Private NFP down 514K.
Figure 1: Nonfarm payroll employment, July 2019 release (blue), stochastic trend 2014-2016 (red), and March preliminary benchmark revision (August 21, 2019), all on log scale. Light green shading denotes Trump administration. Source: BLS via FRED, BLS, and author’s calculations.
Figure 1: Log real value of US dollar against a broad basket of currencies (blue, left scale), and global Economic Policy Uncertainty (red, right scale). Light orange shading denotes post election, orange shading denotes Trump administration. Source: Federal Reserve Board, policyuncertainty.com, and author’s calculations.
Suppose you thought a hybrid real interest differential/Taylor fundamentals model worked for explaining the real trade weighted dollar. One might estimate over the 2001Q3-2019Q1 period the following:
NABE survey, WSJ survey, Bloomberg survey, PredictIt
…using plain vanilla 10yr-3mo probit regression, over 1986M01-2019M08 period, using data shown below in Figure 1
Surprisingly, that’s not a quote from Larry Kudlow on today’s news shows. Rather that is then Council of Economic Advisers Chairman Ed Lazear on May 8, 2008. Just to remind people, that is 5 months after the recession start determined by NBER. Continue reading
Michigan, Pennsylvania and Wisconsin drop, as US manufacturing employment rises.
As the date of the resolution of the US-China trade dispute drifts further and further — perhaps past the 2020 elections according to Mr. Trump — it behooves us to look at what soybean futures contracts for September 2019 indicated as of Trump’s announcement of Section 301 action against China ($10.30 bushel on 3/22/2018) vs $8.67 today (Sept. 2019 is the front month future for soybeans now).
That’s what reader Ed Hanson surmises:
Why are long term interest rate coming down. There is one obvious answer. The world sees the US as the safest and best place to invest with their bond holdings because of rigorous US economy brought on by the Trump administration with its tax and reduced regulation policy. Perhaps it is this circumstance of inversion that means it is not indicating recession, at least for the US.
Just glance at today’s Economist for an alternative interpretation:
Figure 1: Nonfarm payroll employment (blue), industrial production (red), personal income excluding transfers in Ch.2012$ (green), manufacturing and trade sales in Ch.2012$ (black), and monthly GDP in Ch.2012$ (pink bold), all log normalized to 2019M01=0. Source: BLS, Federal Reserve, BEA, via FRED, Macroeconomic Advisers (7/25 release), and author’s calculations.