Jobless claims stay low as layoff activity remains subdued
https://www.marketwatch.com/story/jobless-claims-stay-low-as-layoff-activity-remains-subdued-f110a406?mod=home_ln
Initial jobless claims rose by only 1,000 to 218,000 in the week ended July 26, the Labor Department said Thursday. The data indicate a stable labor market with low layoff activity.
DB2
These are big revisions down in monthly jobs numbers.
Only 19k and 14k net jobs in May and June respectively. (+73k jobs initially reported for July).
We are in a slow growth, muddle through economy.
Perhaps not yet a recession, but looks like we sure are trying for one.
September rate cut probability just shot up to over 80%. One more jobs report between now and then.
In a word my outlook is ādankā.
With the probability of another cut in October over 50% now.
The shocking April numbers didnāt get revised downā¦weird. Iām wondering if we can trust these numbers, or it someone is creating a reason for rate cuts.
I think a well placed unnamed politician might now blame the ensuing slowdown on the Fed for not seeing into the future. Whatever.
My latest 90 day treasuries expire at the end of August, my 4 percent plus short term treasury gravy train will likely end, and I may be ready to start shifting money out of the U.S. and into more foreign equities.
Anybody else have better ideas?
Which are you looking at? Iāve also thought about this, but wonder what foreign equities will remain (largely) unaffected by the US economy.
Pete
EU aerospace and defense ETFs are intriguing. Take EUAD for example:
Of course. That is the āJCā play. The pump seal company honchos blamed every project lost on nefarious behavior by the winning seal company.
Steve
My longer reply disappeared. Ideas. Vxus, vsgx international ETFs, iev for a European tilt, zurvy and/or scmwy (Switzerland). Thoughtful feedback welcomed.
Powell is holding firm, so 4% + should stick around for awhile. He wonāt have his own toadie in as Fed Chair till 2026. I am still just rolling over short term Tās. I have bought GOOG over the last couple weeks. I own etf EFA, it had a strong run up this year, but I think itās stalling out like most everything else. The Stock Market is letting him know they donāt like the tariffs. The Bond Market will probably let him know that they donāt like his penchant for free/easy zirp money, which is exactly like he wants. I await the spin, and the pretzel twisting logic of his supporters, itās alway good for a laugh.
This is where we need a better ouija board. I am guessing that deflationary pressures will increase this month, forcing the Fed to lower rates and allowing certain politicians to blame the Fed for acting too slowly. If your ouija board is closer to the mark at the end of the month than mine, I will have the option of rolling that money into short term treasuries again and postponing my move into the rest of the world.
We now have the June number for consumer spending, real PCE, +0.1% (vs +0.3% predicted by the regression model using retail sales with simple CPI inflation adjustment).
Monthly consumer spending (real PCE) this year has been
Jan -0.56%
Feb -0.10%
Mar +0.68%
Apr +0.09%
May -0.28%
Jun +0.1%
Q1: +0.02%
Q2: -0.1%
YTD: -0.1%
(not annualized)
The above continues to suggest near zero growth, maybe weakly positive, in Q2 and YTD 2025 for the consumer spending economy, about -0.4% and -0.2% annualized, respectively.
Leading up to the Q2 GDP release, GDPnow estimated Q2 growth of 2.4% with real PCE of 1.5% (annualized), much higher than above.
PCE in the Q2 GDP release is +1.4%, so the GDPnow PCE estimate was very close but the monthly real PCE numbers above are much smaller.
Iām not sure why the big difference, it could be these arenāt apples to apples, culprits could be adjustments for seasonality or inflation, or this could be just noise, I donāt know.
There will be more releases of Q2 GDP numbers as the figures are revised in subsequent months, so we can watch if the PCE numbers change.
As mentioned upthread, we are in a slow growth, muddle through economy.
Q1 and Q2 GDP growth bounced around a lot because of fluctuations in trade driven by US trade policy.
In Q1, GDP growth was -0.5% and in Q2 it was +3.0%, averaging to about +1.25%, which is slow growth.
This is great news! The key solving immigration is to make the economy so bad that no one wants to come here. We can all be thankful the administration is pursuing this policy so aggressively.
And letās give a shoutout to the authorās employer. They donāt hold a lack of understanding of quantity, hyphenation, or misuse of dangling modifiers as a condition of employment. If we could get rid of subject-verb agreement weād have full employment in no time.
Interest rate cuts might not increase inflationary pressures. The housing market is overextended. Debt is overextended.
Perceptions are an interesting thing. I think we are closer to everyone throwing up their hands and saying maroon.
I read something interesting about the overall economy recently. Basically what they were saying is that spending on AI data centers is way higher than expected and large enough to directly affect the GDP numbers in a meaningful way. Since those are not part of consumer spending, maybe for a few quarters the usual split between consumer spending and other spending will be different? Consumer spending is usually about 70% of GDP, but I donāt know what the current numbers are according to that article I read.
Addendum: Peteās european etf (vgk) has slightly lower fees and better long term returns than iev.
From Aprilā¦
The month isnāt over yet, but so far so good.
Global economic growth is now expected to slow only slightly ā to 3.2% in 2025 from 3.3% last year ā compared to the 2.9% the OECD had forecast in June.
DB2
I am still holding to my position that we wonāt know.
You mean its happening and we cannot see it happening? orā¦. Itās happening to parts of the economy visibly, but not to other parts of the economy in a very sector based way.