Employment

Onshoring Is Happening Now. Don't Underestimate MAMA!

Jun 6, 2023 2 min read

Don't underestimate "MAMA," which stands for “Making America Manufacture Again.” Manufacturers, large and small, domestic and foreign, are tapping into the trillions of dollars of incentives available in the CHIPS and Science Act, the Inflation Reduction Act (IRA), and the Infrastructure Investment and Jobs Act to build factories in the US. They plan to make semiconductors, batteries, solar equipment, electric vehicles (EVs), and green hydrogen, among

Ed Yardeni

S&P 500: Smooth Sailing to Another 2023 High

Jun 1, 2023 2 min read paid

Hooray! The US government won't default on its debts. There are plenty of jobs. Unit-labor-cost inflation is moderating. The banking crisis is abating. The recession is still a no-show. Earnings were better than expected during Q1 and are probably bottoming during the current quarter. The FOMC likely will pause its rate hiking for at least one meeting. AI will boost productivity if it doesn't kill us.

Ed Yardeni

The Economic Week Ahead: May 30-June 2

May 29, 2023 2 min read paid

Now that a debt deal is on the verge of becoming a done deal, the markets can focus on economic growth and inflation. This week will be a big one for labor market indicators. May's consumer confidence survey (Tue) will include a series for "jobs plentiful." The latter is highly correlated with the JOLTS report's "job openings" series to be released with

Ed Yardeni

Hard to Have a Hard Landing When Employment Is Growing

May 7, 2023 2 min read paid

The S&P 500 rallied on Friday following yet another stronger-than-expected employment report. In his press conference on Wednesday, May 3, Fed Chair Jerome Powell observed: “It’s interesting [that] we’ve raised rates by 5 percentage points in 14 months, and the unemployment rate is 3½% pretty much where it was, even lower than where it was, when we started.” On Friday, we learned that the unemployment rate

Ed Yardeni

The Economic Week Ahead: May 1-5

Apr 29, 2023 1 min read paid

This is another big week for earnings reports, which have been mostly better than expected so far. In addition, the FOMC meets on Tuesday and Wednesday, when Fed Chair Jerome Powell holds his après-meeting presser at 2:30 p.m. In our opinion, it's a toss-up whether the Fed will do none or one 25bps rate hike. But our subjective odds of an announced pause is 75% either

Ed Yardeni

Falling Interest Rates

Apr 4, 2023 2 min read

Interest rates continued to fall today after Jamie Dimon, who is the President, CEO & Chairman of JP Morgan Chase, warned that the banking crisis is "not yet over" and will cause "repercussions for years to come." He did so in his annual letter to stockholders. With all those titles, he must know what he is talking about. He observed that potential losses from held-to-maturity bonds,

Ed Yardeni

A Dish of Mixed Nuts

Mar 28, 2023 1 min read paid

Today's economic indicators show that the labor market remains tight, while manufacturing activity remains weak. That mix supports our soft-landing scenario with inflation continuing to moderate and the Fed done (or almost done) tightening. Consider the following: (1) Consumer confidence. The labor market remains strong according to the March survey of consumer confidence conducted by the Conference Board. The “jobs hard to get” response remained very low at

Ed Yardeni

The Economic Week Ahead, March 5-10

Mar 5, 2023 2 min read

Fed Chair Jerome Powell will testify on the Fed's semiannual monetary policy report to two congressional committees on Tuesday and Wednesday. He is likely to say that although there are signs of disinflation, inflation remains too high and the Fed still has lots of work to do to bring it down. Powell's favorite labor market indicator, i.e., job openings, will be out on Wednesday for

Ed Yardeni

The Economic Week Ahead, Jan. 30 - Feb. 3

Jan 29, 2023 1 min read paid

The FOMC meets on Tuesday and Wednesday. Odds are the committee will vote for a 25bps federal funds rate hike to 4.50%-4.75%. Odds are that Fed Chair Jerome Powell at his Wednesday afternoon presser will continue to sound hawkish even though economic growth is slowing and inflation is moderating. This week will also be jampacked with employment indicators. January's Consumer Confidence (Tue) is likely to

Ed Yardeni

Strong Labor Market Frustrates Fed

Jan 5, 2023 2 min read paid

On August 27, 2020, Fed Chair Jerome Powell's speech at Jackson Hole explained why on that same day the Fed issued a revised Statement on Longer-Run Goals and Monetary Policy Strategy. The statement and Powell's remarks stressed that monetary policy would focus on reviving the labor market after it was weakened by the pandemic. Powell said: "With regard to the employment side of our mandate,

Ed Yardeni

The Economic Week Ahead, January 3-6

Jan 1, 2023 2 min read paid

The first week of 2023 will be action packed, especially with so many labor market indicators coming out. If they are too strong, investors will fear higher-for-longer interest rate hikes by the Fed. If they are too weak, investors will fear an impending recession. The first scenario is bad for stocks and bonds. The second scenario is bad for stocks but good for bonds. If the upcoming batch of labor

Ed Yardeni

Sweet & Sour

Nov 29, 2022 1 min read paid

Today's release of November's Consumer Confidence Index showed that the labor market remains relatively tight. The percentage of respondents saying that jobs are plentiful remained high at 45.8%. That's still elevated even though it was mostly around 55.0% last year. This series closely tracks the job openings series in the JOLTS report, which will come out tomorrow for October (chart). The Fed

Ed Yardeni

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