Putting aside the possibility of the Trump Executive Orders surviving constitutional challenge, let's just put some math around it to compare it to what Congress might end up passing anyway. I'm just going to compare what the direct transfer payments will be. My back of the envelope calculation of the average payroll tax savings for those making under $100,000 who …
[Read more...] about Some math behind the EO’s/More evidence of inflation to come
The BLS said 1.76mm jobs were added in July with 1.46mm of this in the private sector. Thus, the government added 300k jobs (mostly public sector government education due to seasonal factors). This is above the estimates of 1.48mm and 1.20mm respectively. Revisions were modest in the two prior months, with a net combined add of 17k. This also compares with the 4.79mm …
The payroll estimates are all over the place this morning but keep this in mind. There is a wide spread in the estimates between privately created jobs and government. The headline estimate is 1.48mm but the private sector forecast is 300k less at 1.18mm. I'm not sure where these government jobs are coming from, likely at the federal level. If today's private sector …
Initial jobless claims totaled 1.19mm, below the estimate of exactly 1.4mm and down from 1.43mm last week. Also, continuing claims, delayed by a week, were below expectations at 16.1mm, 800k less than expected and down from 16.95mm in the week prior. There was also a reduction in those claiming PUA as this non seasonally adjusted number totaled 656k vs 909k last week …
The individual investor is still pretty bearish, but a bit less so, on this market as measured by the AAII in stark contrast to every other sentiment gauge with a track record. Bulls rose 3.1 pts but to a still low 23.3. Bears fell just .9 pts to 47.6 and marks the 7th week in a row above 40. Yesterday II said Bulls were 56.7 vs 57.3 while Bears were just 17.3 vs …
The July ISM services index rose 1 pt m/o/m to 58.1 and that was 3.1 pts better than expected. That’s the highest since February 2019 but again, it is ONLY measuring the direction of improvement, certainly not the degree here. New orders rose 6.1 pts to 67.7 and backlogs were higher by 4 pts to 55.9. These were likely buoyed by the drop in inventories which fell …
ADP said there were only 167k private sector jobs created in July, well less than the estimate of an increase of 1.2mm and a sharp comedown from the 4.3mm added in June BUT, June was revised up by 1.9mm jobs. So in March and April ADP said 19.7mm jobs were lost and since then almost 7.5mm have been gotten back. It was small and large businesses that added jobs in July …
With dollar weakness continuing with the dollar index breaking below 93 to the lowest level since May 2018, commodity prices across the board are rallying as we get one step closer to notable inflation and we'll likely see another rise in inflation expectations today in the TIPS market. The conventional Treasury market has lost its pulse, thanks to the Fed and/or due …
As we continue to see nominal interest rates melt away, we are also seeing a continued rise in inflation expectations and thus a further decline in real yields. After rising by 3 bps on Friday, the implied inflation rate in 10 yr TIPS rose another 3 bps yesterday. At 1.58%, that is the highest since late February when the conventional 10 yr yield stood at 1.70%. Thus, …
The July ISM manufacturing index rose to 54.2 from 52.6 and that was a bit above the estimate of 53.6. New orders rose by 5.1 pts to 61.5, backlogs were up by 6.5 pts to 51.8 while inventories fell which is likely why new orders and backlogs bounced. Employment was higher too but just by 2.2 pts and still remains well below 50 at 44.3. Export orders regained the 50 …
[Read more...] about ISM & Markit’s mfr’g (former more optimistic than latter)
Peter is the Chief Investment Officer at Bleakley Advisory Group and is a CNBC contributor.
