Waiting on a Recession

The latest economic numbers released by the federal government indicated that 266,000 jobs were added to the private sector last month alone.  That was significantly better than the 187,000 number predicted from a poll of economists done by the Wall Street Journal (WSJ).  The unemployment rate fell from 3.6% to 3.5% the previous month.  The number of discouraged and underemployed workers fell to 6.9%.  The jobless numbers are the lowest recorded since 1969.  Add to these numbers on employment the fact that overall wages grew 3.1% from the previous year.  The Democrats like to say that the Trump tax cuts and economic growth that has taken place are only benefitting the wealthy.  When we look at wage growth on a salary percentage basis, however, the increase for the lower wage workers is actually greater than for those at the higher incomes.  Another falsehood that the Dems like to promote is that the poor are simply not gaining under the Trump economy.  Tax reform and deregulation has brought back manufacturing jobs and stimulated an increase in the number of small businesses, both of which tend to hire the less educated and lower skilled workers.  Unemployment among minorities and women is at all time lows.  The President is actually gaining strength among minorities over the economy and the rise in employment and income among this group.  Recall that President Obama said manufacturing jobs were gone and never coming back.  President Trump has brought back a number of manufacturing jobs; jobs that will not disappear when government funding dries up.  President Obama could only generate jobs by a dumping vast sums of money approved by Congress into the economy as a stimulus.  What was really needed as a “stimulus” was deregulation and lower taxes, both of which President Trump enacted.  Today’s job numbers are genuine and not artificially created by Congress.

Earlier this year economic “experts” were predicting that the economy was heading into a recession.  Using such indicators as an inversion of the yield curve between the short-term and long-term bond yields these authorities confidently predicted a pending recession.  The media and Democrats joyfully accepted these predictions in hopes of dooming a potential Trump second term in the White House.  There are six indicators that are evaluated when looking at the potential for a coming recession.  1) The Yield Curve (already mentioned), 2) Consumer Confidence Indexes – consumer confidence remains high, 3) Employment Data – numbers speak for themselves, 4) Lead Economic Index – predicting future performance on past performance, 5) Gross Domestic Product – is the overall factory production growing or slowing?  Some of these indicators suggest the economy may be slowing but there is no indication of an impending recession.  Even the trade war with China has not significantly hurt our resilient economy.  What is hurting our economy the most is a Congress focused on impeachment instead of passing legislation to help move the nation forward.  I have heard the term “do nothing Congress” used in the past, but it is certainly applicable to this Congress more than ever!

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