818 downward revision in March 2024 NFP.
Figure 1: Level of nonfarm payroll employment from CES (blue), implied from CES preliminary benchmark (red), from Philadelphia early benchmark (tan), Goldman Sachs estimate of preliminary revision (light blue). Early benchmark calculated using ratio of sum-of-states early benchmark to sum-of-states. Source: BLS via FRED, BLS, Philadelphia Fed, and author’s calculations.
How does this change the picture regarding business cycle indicators?
Figure 2: Nonfarm Payroll (NFP) employment from CES (blue), implied preliminary benchmark revision of NFP (bold blue), civilian employment (orange), industrial production (red), personal income excluding current transfers in Ch.2017$ (bold green), manufacturing and trade sales in Ch.2017$ (black), consumption in Ch.2017$ (light blue), and monthly GDP in Ch.2017$ (pink), GDP (blue bars), all log normalized to 2023M04=0. Source: BLS via FRED, BLS, Federal Reserve, BEA 2024Q2 advance release, S&P Global Market Insights (nee Macroeconomic Advisers, IHS Markit) (8/1/2024 release), and author’s calculations.
Update, 11am Pacific:
From Goldman Sachs today:
The BLS’s preliminary benchmark estimate for the revision to payroll growth between April 2023 and March 2024 is -818k, or -68k jobs/month, in line with our expectation of a 600k-1mn downward revision. As we have noted last week, we think that today’s downward revision to payroll growth exaggerates the degree to which job growth has been overstated by about 500k, both because the QCEW likely excludes many unauthorized immigrants who are not in the unemployment insurance system but were correctly picked up in payrolls initially, and because the QCEW itself has tended to be revised up in recent years. As a result, we think the true downward revision should be about 300k or 25k per month, which would imply that monthly job growth over this period was closer to 215-220k than the initially reported 242k, but not as low as the 174k pace implied by the revisions.
So for those who think the Fed has been behind the curve – yes indeed.
Walmart Prices Going Down Hands Kamala Harris a Huge Win
https://www.newsweek.com/walmart-prices-going-down-kamala-harris-win-1942359
Walmart has announced it is lowering prices on thousands of products in what could be a big win for Kamala Harris in the run-up to November’s presidential election. The retail giant is set to slash prices on more than 7,000 items, including groceries, with just over two months left before polling day. “As it relates to value, we’re lowering prices,” Walmart CEO Doug McMillon said in a call with investors regarding second-quarter earnings, according to CNBC. “We have less upward pressure, but there are some that are still talking about cost increases, and we’re fighting back on that aggressively because we think prices need to come down.” Overall inflation was flat for the quarter for the retailer, and revenue growth came in due to selling more units instead of charging higher prices, Chief Financial Officer John David Rainey told CNBC. “We want to drive everyday low prices,” Rainey added on the call. “We do not intend to achieve any of our margin performance by passing this along to our customers and members in the form of higher prices.” Walmart is not the only retailer to take this step. According to The New York Times, Swedish furniture behemoth Ikea has lowered prices three times in the past year. Best Buy has reduced prices on its appliances, and crafts chain Michaels said it has cut the cost of 5,000 items including canvases and T-shirts.
Most people would see this as good news but it seems Trump and Vance are outraged. I bet these two clowns tell the MAGA morons to boycott Walmart and Ikea.
Of course Trump and Vance would be outraged that a business would do anything like cut prices in a way that might help their opponent. What Trump and Vance may not realize is that corporate America, as greedy as it is, also values stability and predictable government behavior. A Trump/Vance administration would be nothing but chaos, as Trump blundered from one corner to another without much rhyme or reason. They have seen it and didn’t much care for it. Taxes are cheaper than a trashed economy, and the kind of blundering Trump is likely to do could easily trash the economy. Thinking about it that way, WalMart and others may actually be thinking strategically when they cut prices now. A Harris/Walz administration could be far more profitable for them over time than a Trump/Vance administration.
if they do not drop prices, then inflation will continue at higher rates. that will make the fed either hold off on rate drops, or gasp, actually increase rates again to address the inflation. either of those actions will eliminate a soft landing possibility, and place us in future recession territory. no business will be profitable if a recession, even mild, hits. so walmart is doing the correct thing if it wants to keep profits humming along. a recession would ultimately result in price drops as well, but businesses would operate at a loss for longer as well. this action has the greatest chance of medium term profitability for walmart.
So employment still grew but not as fast as we had originally thought. More reason for the FED to cut interest rates.
Which will cause more flying ketchup.
https://www.msn.com/en-us/money/news/wall-street-labels-kamala-harris-proposed-tax-on-unrealized-gains-as-dumb-move-opposite-of-creating-incentives-to-be-long-term-oriented/ar-AA1pbE8e?ocid=msedgdhp&pc=U531&cvid=400cb309642c4cb7bfc7dab0aea1b79f&ei=5
Harris’ Tax Proposals: The vice president said she would endorse Biden’s proposal to raise the federal corporate tax rate from the current 21% to 28%. Incidentally, her opponent in the presidential race, Donald Trump, has pledged to lower the tax to 15%. The higher revenue anticipated from the tax rate hike is expected to fund some of the economic proposals including a $6,000 tax credit for parents of newborns and the reinstatement of the pandemic-era expanded Child Tax Credit. Harris also supports an annual 25% minimum tax on the unrealized gains of individuals with income and assets that exceed $100 million.
Alas the title of this story said something about taxing profits when they accrue as a “dumb” idea according to “Wall Street”. I’m sorry but a lot of economists think this is a good idea.
BTW – now that our hit and run lying MAGA moron (Bruce Hall) are decided to stick he little face out the ground – let’s remember he thought Harris was not raising taxes on the well to do. She is but let’s not stop Brucie for his serial lying.
Elon said “bread lines and ugly shoes”
First they came for the billionaires…..
One of those alleged Wall Street “experts” who criticized Harris’s proposal tax profits when they accrue was Joey Mannarino
White MAGA commentator deletes post saying he’s a Black woman voting for Trump
https://www.rawstory.com/joey-mannarino/
So he was in favor of gender change until he realized they were going to cut off something.
I’m sure Menzie (along with some others here) has figured out I spend too much time online. But how much free time would Mannarino have to have to make that worth the waste in time consumption??
Trump is infamous for his con game of promising people something with no paper trail, then running away from that promise as soon as he got what he wanted from them. Now if seems he has cought a guy with a brain worm in that scam
https://www.cnn.com/2024/08/21/politics/rfk-jr-speech-friday/index.html
If it goes like Trump usually does it, he will ask for all the RFK votes and promise in return that RFK will become the secretary of interior, and the vaccine czar. Then the day after the election he will tell RFK that unfortunately Eric wants to be secretary of the interior because he wants an indoor job – but JFK can still be vaccine czar. By inauguration day, JFK will be told that a rich person renting 2 floors of a Trump hotel for a whole year Musk be appointed vaccine czar – but JFK can get a MUCH better job as assistant to the undersecretary of the FDAs vaccine study group – if he rents a room in a Trump hotel of his own choice (and that is an offer he and his brain worm can’t refuse!)
yeah, I don’t see this ending well for rfk jr. I can smell the stench of this scam from a thousand miles away. but jr is not one to actually work for his goals. so he will fall, hook line and sinker, for the idea of a cushy appointment by trump. trump also realizes, he probably won’t win anyway, so this becomes a promise not necessary to fulfill. but jr will have to live with the trump stench forever, because he made a deal with the devil.