The continued flow of economic news in this country is relentlessly good. Last week, the ISM Manufacturing Index showed that the factory sector has accelerated. Indeed, the ISM Non-Manufacturing Index of the service sector has reached a nine-year-high. In addition, reflecting our emergence as an energy-exporter, our trade deficit actually decreased.
Of course, the first estimate of the August "Jobs Report" was lousy at only 142 thousand, and the trade deficit is expected to rise, Yes, that Jobs Report was disappointing, but I know of no economist who does not think it is understated, almost universally expecting it to be revised higher next month. Even if not, we are still averaging better than 200 thousand new jobs being created every month of this year. And, by the way, unemployment is still dropping, now at 6.1% and expected to drop to 5.9% by year-end.
The reason our trade deficit is expected to increase is due to the slowdown in Europe. We expect they will be less able to afford American made goods, largely because the Euro is weakening against the dollar, thus making American good more expensive to Europeans. Fortunately, as the Fed's monetary policy has pulled the U.S. economy out of recession, Europe's ECB is preparing to do the same with their monetary policy
As I said, the continued flow of economic news in this country is relentlessly good, which makes some people worry even more. An old Wall Street adage is that Wall Street is always climbing a wall of worry. A corollary to that adage is the wall of worry gets higher as the good news continues.
Yes, the national debt is $17.7 trillion and still climbing. Yes, the Fed's balance sheet at $3.5 trillion is way-too-big. Yes, fiscal policy (AKA Congress) is still a useless drag on the economy. Yes, our employment health is not as good as the numbers indicate. Yes, there are many things to worry about, to fret about, and reasons to lay awake at night.
But, another old adage is that the trend is your friend.
Enjoy the ride, knowing a correction is coming . . . which you will survive.
Of course, the first estimate of the August "Jobs Report" was lousy at only 142 thousand, and the trade deficit is expected to rise, Yes, that Jobs Report was disappointing, but I know of no economist who does not think it is understated, almost universally expecting it to be revised higher next month. Even if not, we are still averaging better than 200 thousand new jobs being created every month of this year. And, by the way, unemployment is still dropping, now at 6.1% and expected to drop to 5.9% by year-end.
The reason our trade deficit is expected to increase is due to the slowdown in Europe. We expect they will be less able to afford American made goods, largely because the Euro is weakening against the dollar, thus making American good more expensive to Europeans. Fortunately, as the Fed's monetary policy has pulled the U.S. economy out of recession, Europe's ECB is preparing to do the same with their monetary policy
As I said, the continued flow of economic news in this country is relentlessly good, which makes some people worry even more. An old Wall Street adage is that Wall Street is always climbing a wall of worry. A corollary to that adage is the wall of worry gets higher as the good news continues.
Yes, the national debt is $17.7 trillion and still climbing. Yes, the Fed's balance sheet at $3.5 trillion is way-too-big. Yes, fiscal policy (AKA Congress) is still a useless drag on the economy. Yes, our employment health is not as good as the numbers indicate. Yes, there are many things to worry about, to fret about, and reasons to lay awake at night.
But, another old adage is that the trend is your friend.
Enjoy the ride, knowing a correction is coming . . . which you will survive.
