Okay, take a step back. Take a breath. Get a grip. Relax. Today is “much ado about nothing.”
– U.S. stocks dropped on Friday, led by banks, after much weaker-than-expected jobs data for May pointed to labor market weakness.
Question: Is the first draft of the May jobs report meaningfully relative to the US economic reality? Answer: Hardly, it is the trend that is important, the flow if you will.
– Unemployment claims have now been below 300,000, a threshold associated with a strong labor market, for 65 straight weeks, the longest streak since 1973.
I could go on with data that points to a continuing trend toward a more robust US economy, but … No, actually I will.
– The U.S. trade deficit increased less than expected in April as exports of goods rebounded strongly, suggesting that trade would be a boost to economic growth in the second quarter.
Now, the above is April data just coming in. I suspect May will corroborate April, but that then leaves a question: what is going on with the May employment numbers? Answer: Who cares?
– Factory orders increased 1.9 percent in April, the biggest gain since a 2.4 percent rise in October. Orders had been up 1.7 percent in March after having fallen in February.
Myopic vision does not allow for good decisions. Always look to the big picture.
Duh Quote of the Week
“I work in the news media, and one of the primary functions of the media these days is to traffic in gleefully broad generalizations.”
And to traffic in sensationalism – “The sky is falling. The sky is falling.”
