Free Republic

When the government jobs and economy report was released last Friday, it wasn’t quite as rosy as we’ve been led to believe: Economist Herbert Stein famously observed, "If something cannot continue, it will stop." Given other readings on the economy, the rapid growth in jobs that was reported by the Bureau of Labor Statistics (BLS) for 4Q2015 and 1Q2016 could not continue. So, in April, it stopped. [ed. in other words, we lied about jobs growth,again.] Telling lies with statistics is so easy even a politician can do itFriday's BLS "Employment Situation" report was terrible. FTE* employment fell by 296,000,...

Who could have seen this coming? Remember a week ago when TV entertainers crowed about the surge in The Baltic Dry Freight Index was a "clear signal" that 'China is back' baby and that escape velocity growth was just around the corner as global growth was destined to pick up... Well, just as we warned very explicitly, the ramp in the index merely reflected the frenzied speculation in industrial metals by the Chinese and as authorities have cracked down on that idiocy, so the Baltic Dry has plunged by the most since November... as real demand punches back.

We continue to get more evidence that the U.S. economy has entered a major downturn. Just last week, I wrote about how U.S. GDP growth numbers have been declining for three quarters in a row, and previously I wrote about how corporate defaults have surged to their highest level since the last financial crisis. Well, now we are getting some very depressing numbers from the rail industry. As you will see below, U.S. rail traffic was down more than 11 percent from a year ago in April. That is an absolutely catastrophic number, and the U.S. rail industry is feeling...

292 Union Pacific engines idled in Arizona Desert Total US rail traffic in April plunged 11.8% from a year ago, the Association of American Railroads reported today. Carloads of bulk commodities such as coal, oil, grains, and chemicals plummeted 16.1% to 944,339 units. - snip - Only five of the 20 commodity categories saw gains. Of the decliners, coal was the biggest. But petroleum products also plunged 25%, and grain mill products dropped 7%. Even without coal, carloads were down 3% year-over-year.

Seldom have we seen so many assets and indicators at decision points simultaneously! We see stocks, gold, and the U.S. dollar trading at extremely important levels, all in conjunction. Note that this is not according to technical analysis, but our intermarket analysis and chart patterns.First, as indicated in recent analysis, risk indicators in U.S. stocks have turned positive in recent weeks. That suggest a bullish outcome for stocks, almost exactly at their breakout level. We prefer to let the market do its work, and so far we have not seen a breakout. But there are sufficient signs that it is in the making. As stocks are testing key resistance, the U.S. dollar...

Despite declines in labor force participation, family income and home ownership juxtaposed to increases in poverty, debt, and health care costs, President Obama maintains that his Administration "probably managed the American economy better than any large economy on Earth in human history." The President lambasted critics who cite GDP statistics that show Obama to be the only president that has failed to deliver even a single year of 3% growth—making his the worst performing administration since Herbert Hoover's during the early years of the Great Depression. "Growth and prosperity aren't the only metrics by which we should judge what has...

After crawling ahead at just a 0.5% annual pace in the first quarter, the slowest in two years, the American economy is due for a bounce — but how high? The jury is out whether the economy has simply hit another speed bump or is facing a more fundamental slowdown, but some details in Thursday’s Commerce Department report point to the latter. U.S. GDP also fizzled at the start of 2014 and 2015, shrinking 0.9% in the former and edging up 0.6% last year... Yet it’s iffy whether the economy can rebound to the same extent... On the plus side,...

A government's arsenal for moderating business cycles consists of fiscal and monetary policy. But the U.S. has little scope for using either if a new recession should now emerge. The Fed has only limited options left for stimulating the economy. And political gridlock may prevent any timely injection of fiscal stimulus. How big are the risks we face, and are we really out of options? Fortunately, continued expansion is the central forecast for the U.S. economy today. Janet Yellen's public assessments of the outlook are screened less for signs that the economy may need renewed policy easing and more for...

Investors are nervously awaiting the start of the first-quarter earnings season today when Alcoa (AA) reports after the close. Stocks and the economy are looking vulnerable, and hopes for corporate profits are not high. The first three months of the year look likely to be the worst quarter for earnings since 2009, with a 10.1 percent drop in S&P 500 profits expected, down from the 0.7 percent growth that was expected for the quarter back in December. The early optimism has since faded, driven largely by declines in energy sector estimates. Analysts are now bracing for the fourth consecutive quarter...

As cities contemplated doubling their minimum wage, conservatives warned that employers would flee. And that’s exactly what happened. Then as states contemplated doubling their statewide minimum wage, conservatives warned them again; but again their warnings were drowned out in the cacophonies of popular liberalism. So now California companies are already collecting bids from moving companies, and ordering new stationery for new digs in Arizona, Nevada, and of course, Texas. The destruction that minimum wage increases cause is no longer even denied by the left. Their politicians happily proudly admit the damage they do, even as they inflict these pains on...

There used to be a rule in place – part of the sadly abandoned movements toward welfare reform in the 80s and 90s – which required food stamps recipients to do at least some work in order to receive the benefits if they were childless and able bodied. That rule was suspended in most places since the beginning of the crash in 2007, but now that unemployment is allegedly back down to nominal levels and the economy is “stable” across most of the country, that exception is being rolled back. This, of course, has liberals up in arms. (WaPo) The...

U.S. consumer spending barely rose in February and inflation retreated, suggesting the Federal Reserve could remain cautious about raising interest rates this year even as the labor market rapidly tightens. Monday's report from the Commerce Department also showed consumer spending in January was not as strong as previously reported. That, together with other data showing a widening in the goods trade deficit in February, indicated economic growth remained sluggish in the first quarter... ...Consumer spending edged up 0.1 percent as households cut back on goods purchases after a downwardly revised 0.1 percent gain in January. Consumer spending, which accounts for...

On the face of it, the economic update that the government is releasing on Friday should be a big yawn. Economists expect the revised numbers to confirm what we know already — that gross domestic product grew at an annual rate of just 1 percent in the final three months of 2015. But it would be a mistake to dismiss the release — even if you're off from work for the Easter holiday. That's because the government also will be publishing its first estimate of what happened to company profits in the period. And the news isn't expected to be...

Ten U.S. states still have not regained all the jobs they lost in the Great Recession, even after six and a half years of recovery, while many more have seen only modest gains. […] Wyoming had 3 percent fewer jobs last month than it did in December 2007, when the recession began, the Labor Department said Friday. That is the biggest percentage decline among the states. Alabama's job total trails its pre-recession level by 2.7 percent, followed by New Mexico, where job totals are 2.6 percent lower. Some larger states are also still behind. New Jersey has nearly 1 percent...

Less than a decade ago, the world economy sank into the Great Recession: the deepest and most widespread downturn since the Great Depression of the 1920s and '30s. Since the stock market crashed in 2008, recovery has been long and slow, marked by persistent bumps in the road along the way. Nonetheless, an economic recovery has, indeed, taken place. The S&P 500 index rose more than 92% over the past five years until market volatility kicked in during the second half of 2015. So far in 2016, the S&P 500 is down almost 9% since the start of the year....

ECONOMIC alarm bells are ringing: Financial markets have wilted. Forecasters have been slicing their projections for future growth. And some leading wise men — including the megabillionaire George Soros — are predicting a return to disastrous 2008 conditions. That’s almost certainly an overly pessimistic view. But without a doubt, the leading global economies are in a major slowdown. Not evident is whether another recession looms. While current data suggests... Governments alone are not to blame... For a start, global competition and weak productivity growth have held down wages in developed countries. That has depressed consumer spending, as have increased saving...

A recession in Europe could lead to the collapse of the eurozone, as the single currency would buckle under the political turmoil unleashed by a fresh downturn, a leading investment bank has warned. In a research note titled "Close to the edge", economists at Swiss bank Credit Suisse warned the fate of monetary union hangs in the balance if Europe's policymakers are unable to ward off another global slump and quell anti-euro populism. "The viability of the euro is contingent on the current recovery," said Peter Foley at Credit Suisse. "If the euro area were to relapse back into...

ISM Index Near Breakeven Construction spending jumps as gov’t funds fuel spike in highway activity The goods sector is starting to carry more of the economic load. The Institute for Supply Management reported Tuesday that its manufacturing index rose to a five-month high of 49.5 in February, up from 48.2 the prior month. While the headline index is still below the neutral 50 level, production and new orders both expanded at the fastest pace since August. Auto production doesn’t appear ready to cool, as February U.S. sales of cars and trucks rose to a 17.7 million annual pace. While General...

WASHINGTON, Feb 25 (Reuters) - The number of Americans filing for unemployment benefits rose last week, but remained below levels consistent with a tightening labour market.

Did you know that there are some U.S. states that have already officially fallen into recession? Economic activity all over the planet is in the process of slowing down, and there are some areas of the country that are really starting to feel the pain. In particular, any state that is heavily dependent on the energy industry is hurting right now. During the years immediately following the last recession, the energy industry was the primary engine for the growth of good paying jobs in America, but now that process is completely reversing. All over the U.S. energy companies are...