Reclaiming Common Sense

(April 1) This was "Jobs Week." This means that you receive ADP Payroll Report and Jobs Report forecast articles from this column. "March ADP May Surprise to the Upside" detailed how all sectors were expected to grow month to month and March to March, seasonally adjusted. It was thought that we would grow annually over 2.00% and month to month by at least 0.15%.

(April 1) The week's first economic report that his column examined was the February Retail Report. This report should have been released during the middle of March not the first day of April. The government shutdown shutdown the release of some economic reports. "February Retail Report Finally Released" details how while the seasonally adjusted month to month sales declined the non-seasonally adjusted February to February data continued to grow. The rolling year growth rate for the past 12 months was just under 5.00%.

(April 3) The monthly Jobs Report forecast article normally takes at least a day to research. This month was no different. "March Jobs Report Forecast: Onward and Upward" was in pretty close agreement with the ADP Payroll forecast. All sectors were expected to grow month to month and March to march, non-seasonally adjusted. All sectors were expected to grow month to month and March to march Seasonally adjusted, with the exceptions of the Mining and Logging sector and the Information Technology sector, March to March. Annual Growth was expected between 1.93% and 2.05% and month to month growth was expected between 0.51% and 0.63%.

(April 3) The ADP report was released Wednesday Morning at 8:15 AM EDT. The headline payroll growth of 129,000 jobs was a surprise to the low side of expectations. "March ADP Payroll Surprised" details how while we did see annual growth of 2.01% and all sectors grew March to March, there was a month to month growth rate of 0.10%. Three sectors reported contractions month to month: Construction, Manufacturing and Financial Services. Final services contracted during Tax Season? Construction contracted during the Spring Building Season?

(April 4)  This week the mainstream media finally decided to comment on the Weekly Unemployment Claims Report or, as they framed it, the firing report. "How Low Can Unemployment Go" is the third article with the same title. It is a good question. We recorded our third consecutive week with non-seasonally adjusted (NSA) first-time claims under 200,000 claims. We have had more than four years with the seasonally adjusted (SA) FTU at or below 300,000 claims. We had the NSA Continuing drop below 2 million for the first time this year and the SA CC is approaching the two year anniversary with the SA CC under 2 million claims. The Insured Unemployment Rate dropped to 1.33%, an all-time low for this week of the year.)

(April 5) Jobs Day. There was a considerable amount of data to unpack. "March Jobs Report Rebound" was another round of "The Tale of Two Data Sets" from February. The CPS jobs data was weak and the CES worker data was strong, the opposite of February when the CPS data was strong and the CES data was reported as being weak. We saw the NSA CES worker data grow at 1.92%, slightly lower than the 1.93% to 2.05% expected. The unemployment level fell to levels comparable to March 1999 and March 2000 and lower than March 1998 and March 2001. The Unemployment rate was lower than all for of these March Unemployment rates.

(April 6) The March Tale of Two Data Sets analysis continued through Friday into Saturday. "March Wages and Worker Data: Up Remarkably" examined the month to month and March to March changes in workers and wages. We saw non-seasonally adjusted growth month to month and March to March in all sectors, as expected. The surprise was that we saw seasonal adjusted reductions in workers in the Construction sector, the Manufacturing sector, and the Government sector month to month. Really? The good news is that we saw increases in wages in all sectors, ranging between 1.59% and 6.11% for an average NSA wage increase of 3.13%. When wages rise and the number of workers rises concurrently then the total wages earned really pops. Total wages grew by  5.28%. This should mean strong Personal Consumption Expenditures reported in the First Quarter Advance GDP report this month.

(April 6) The April 6 Week in Review article recounted the prior articles from the week.

(April 7) The week started early with a rare Sunday article. "Five Presidents at 26 Months" Job Mountain" detailed how President Trump has done something that only President Clinton was able to do after 26 months in office: Cut unemployment and grow jobs. President Trump has added more full-time (CPS) jobs than former Presidents Reagan, Clinton, George W Bush and Obama..... combined.

(April 8)  The CPS data also has information regarding the level of full-time and part-time jobs that men and women are working. "March Men and Women: Better than 2018, Again" discussed how men and women are climbing the "Jobs Mountain" instead of being under the "Jobs Iceberg." Men are working more total jobs, and more full-time jobs, than they were working last March. Women are almost working an all-time record level of jobs, non-seasonally adjusted. They should set an all-time jobs record within the next few months. It is important to note that women work more part-time jobs than men and men work more full-time jobs than women.

(April 9) Last week we received the March Jobs Report. This week we received the February JOLTS report. We had record March levels of Job Openings, Quits, Separations, Hiring, and Job Openings. The article "February JOLTS Churn and Burn Report" details how the same four sectors had the most Job Openings, the most quits, the most total separations, and the most hires. The article also addresses a "Layoff Report" that was released the same day as the March Jobs Report and examines the February JOLTS "Layoff" data. Hint: It is dangerous to compare two different data sets.

(April 10)  The media has been hyperventilating regarding the recent wage inflation that has been recorded and reported. If you have been paying attention to the media during the past few years there were discussion regarding wages not keeping up with inflation. The narrative since last Summer has been "Well, it's just a little better than inflation," or "Well, you have to differentiate between real wage growth and nominal wage growth." Well, that is a deep subject. "March 2019 CPI: Ballooning Medical Care Services" examines the weighting of the monthly basket of goods and the same month inflation rates from March 2018. Medical Care Services used to take 4.765% of our "budget" during March 2009. according to the CPI report. This March it took 7.000% of our budget.  That is serious inflation.  Fortunately, we are still seeing commodity deflation.

(April 11) It appears that the media is picking up on the situation that we have remarkably low first-time unemployment claims data, remarkably low continuing claims data, and a remarkably  low insured  unemployment rate. The article "April Fool's: Weekly Unemployment Claims Data No Joke" details how we had our first official Seasonally Adjusted First-time Claims data under 200,000 since November 1, 1969. We also have now had 2 years of seasonally adjusted continuing claims under 2 million claims. The continuing claims data was from March 31st, the day before April Fool's Day.

(April 12) Next week we will receive the March MARTS Retail Report. There has been some hand-wringing regarding the Retail Sales data since the release of the December Retail Report. We had a record December and a record Retail Sales year during 2018, based on the non-seasonally adjusted data. We had a record January and a record February, based on the non-seasonally adjusted data. It appears that sectors sensitive to the housing market were impacted by the Government Shutdown. It is also possible that we will see a rebound now that the Shutdown is over and the loan approval process is moving forward. "March Retail Forecast: Firing on all Cylinders" details how all sectors are expected to grow, non-seasonally adjusted, month to month and March to March. All sectors are also expected to grow March to March with regard to the seasonally adjusted data. There may be one or two sectors with weak month to month seasonally adjusted data.

(April 13)Week in Review

(April 17) The week started with a forecast article for the New Home Construction data, the New Home Sales Data, and the Existing Home Sales data for March.  The month to month and March to March data was pointing toward some strength. The question is what are the lingering effects of the Government Shutdown? "How High Will Real Estate Jump This March" goes into the details.

(April 18) The media used to cover the weekly unemployment claims reports at the bottom of the 8:00 hour Thursdays. It was great if we had seasonally adjusted (SA) first-time (FTU) claims under 300,000 claims. This week we just had SA FTU under 200,000 claims for the past two weeks. "Astounding Unemployment Claims Data" digs into the data and finds seriously low first-time claims data, remarkably low continuing claims data, and an Insured Unemployment Rate of 1.20%.

(April 18) The March Retail Sales Report "rocked" if you listened to the mainstream media. The Report was goo, not great. "March Retail Lamb Reported as a Lion" details how the month to month data, the headline data, spiked, seasonally adjusted and non-seasonally adjusted. The March to March data was not as strong as it could have been.  The data was still good, growing at over 4% a year, seasonally adjusted or non-seasonally adjusted, during the past 12 months. Current year sales, the first three months, did grow at over 3%, which should mean that the first quarter GDP should grow, same quarter, by over 3% if Gross Private Domestic Investments, Government  Consumption Expenditures, and Import/Export data is at all strong.

(April 19) The stock markets were closed in the United States for Good Friday. The government still published the March New Construction data. The article "New Home Completion Up" explains that while the March Starts data was week, and the March units under construction data may have plateaued, that the Completions data bodes well for future sales. Completions hit the highest March level since March 2007.

(April 20) Week in Review. This week in review included commentary on a "CFO Survey" that was projecting weakness in the economy and a [possible on-coming recession. The poll was taken after the December Stock Market Correction.

(April 22) Last week a March Real Estate Forecast article and the new Home Construction data Article for March were published. This week we received the existing home sales and the New Home Sales data. "March Existing Home Sales Blooming" explained how the Inventory level increased month to month and March to March. It also explained how we are still near historically low inventory levels for this month of the year. This lack of inventory held back existing home sales. The average sales price was a March Record.

(April 23) The March New Home Sales data was better than the existing home sales data. The article "March New Home Sales Surprise" details how we had the most March New Home Sales since March 2007,  how inventory, while down from February is up by over 15% from march 2018, and that the average sales price rose from the level record during March 2018. It is important to know that we are already ahead of sales compared to where we were during March 2018.

(April 25) Weekly unemployment claims used to be "headline news at the bottom of the hour." That was prior to the 2016 Presidential Election. We have had more than 200 consecutive weeks  where we have had the seasonally adjusted first time unemployment claims data at or under 300,000 claims. We have had more than 100 weeks of seasonally adjusted continuing claims below 2 million claims. The insured unemployment rate is well below 2.0%. "April Weekly Unemployment Claims: Mixed" explains how while the first-time claims data edged up from last week's level that they continuing claims level fell and the insured unemployment rate dropped to 1.19%

(April 26) The Ardnassacs where looking for a fifth rate hike during 2018 while the original story was that we would see five rate hikes between 2018 and 2019. These "Chicken Little Economists" were making forecasts of a 2019 Recession after the massive December Correction in the major markets. The "Scrooge Slide" was actually a number of entities "locking in gains" for 2018 who started reinvesting this quarter. The Advance First Quarter GDP, according to the Ardnassacs of the media we were going to drop to 0.5% growth this quarter as a result of the Government Shutdown. "First Quarter GDP Hits 3.2%" explains how the economy is firing on all cylinders. There are eight cylinders: Quarter to quarter Personal Consumption Expenditures (PCE,) Gross Private Domestic Investment (GPDI,) Net Exports, and Government Consumption Expenditures (GCE,) and the Same Quarter PCE, GPDI, Net Exports, and GCE. All eight cylinders were positive this quarter.  The Chicken Littles and Ardnassacs were screaming that the was "soft" PCE data. They ignored the jump quarter to quarter (Q2Q) of exports of 3.7% and the decline of imports by 3.7%. Net exports rose.

(April 27)Week in Review

(April 29) The week started with the article "April ADP Bounce Probable" examined the month to month and April to April trends and found that all sectors should grow March to April and April and that all sectors would grow April to April. Month to month growth has peaked and troughed in alternating months. Last month was a trough. This month was expected to be a peak.

(April 30) The "Jobs Report Forecast" article "April Jobs Report Should Fire on all Cylinders" found a similar trend with regard to the month to month and April to April data. Where it appeared that the annual ADP growth would possibly pull up the month to month growth, the month to month Current Employment Statistics worker data growth was anticipated to push up the annual growth rate. All sectors were expected to add workers month to month and April to April. There was a significant jump in non-seasonally adjusted full-time jobs, a drop in part-time jobs, and a remarkable drop in unemployment.