FOX Business host Larry Kudlow discusses how the economy is doing under President Donald Trump on ‘Kudlow.’
For all those left-wing newspapers obsessing over the Trumpian economy, aka America’s great economy, almost every number coming out this spring shows strength and resilience. Yes there is a war going on, yes fuel and other energy prices have jumped as a result of that war, but it is very difficult to find negative effects from the shock of the energy war in Iran.
Of course that’s all the lefty machine ever writes about, but lefties will be very disappointed that there is no recession in sight. Indeed, the Atlanta Fed GDPNow forecasts growth of 3.7 percent annually in the second quarter. And today’s job numbers are another example of a strong economy. Beat expectations twice.
Private sector payrolls jumped to 123,000, following last month’s gain of 190,000. Those are big numbers. The unemployment rate is still at 4.3 percent. That’s probably the full employment number.
We no longer need hundreds of thousands of jobs each month because the borders are closed. And the so-called break even rate of job growth may be something close to zero. Indeed, 3 million bona fide immigrants have left the United States through deportation or criminal deportation. Still, while President Trump has cut government workers by 345K, private sector workers have grown by nearly as much in the past 2 months.
Weekly jobless claims continue down. And what’s interesting is that unsuspecting manufacturing workers have done very well in the past year. Their hourly earnings increased by 3.7 percent while their hours worked decreased by 1 percent. Now what economists call the wage income proxy, which adds wages to hours worked, now shows a 4.7 percent increase. Blue collar people do better than white people.
National Economic Council Director Kevin Hassett praises President Donald Trump’s ‘Kudlow’ speech.
And a net income gain of 4.7 percent is still better than the 3 percent inflation rate favored by the Federal Reserve. And even more than the 2.7 percent consumer price index from the Cleveland Fed. Or the 2.4 percent cut from the Dallas Fed.
No one is happy about the energy shock, including me, but I still believe it will be temporary. And I still believe it’s a small price to pay for the horrible and brutal Iranian regime, perhaps the worst government we’ve seen since the Nazis a hundred years ago to get rid of them all.
However, the Institute for Supply Management’s resources and productivity indicators are strong. Non-farm productivity over the past year increased by 2.9 percent. And unit labor costs rose by just 1.2 percent, which may be the best measure of inflation of all. And that includes America’s best operating profit for at least 20 years. Remember that profit is the mother’s milk of stock. And that leads to record breaking stock markets.
In Trumpian America, both labor and investment capital are both doing very well. That’s what you get for tax cuts, deregulation and “drill, baby, drill,” and fair trade. Everything.
