• Weekly Economic Monitor -- Spending, Deficits, and Debt

    By: Scott J. Brown, PH.D., Raymond James

    Spending, Deficits, and Debt – On Monday, the Treasury Department is expected to report a March budget deficit of about $658 billion, bringing the 12-month total to nearly $4.1 trillion, about 19% of GDP. Proponents argue that the added spending, with more to come, will help to ensure the recovery. Critics charge that it’s overkill, likely to push aggregate demand ahead of supply. The debate over infrastructure spending will amplify these divisions.

    This Week – The March CPI report should show a year-over-year gain of around 2.4%, reflecting “base effects” (a rebound from the low figures of a year ago, as the CPI fell 0.3% in March 2020) – nothing to worry about. The March reports on retail sales, industrial production, and residential construction should each show a strong rebound from the effects of February’s bad weather.

  • Weekly Economic Monitor -- Jobs!

    By: Scott J. Brown, PH.D., Raymond James

    Jobs! – As the pandemic recedes and the economy reopens, we can expect strong job growth in the months ahead. The March figures were a start. We may soon see monthly gains in nonfarm payrolls of a million or more. However, as employment rebounds, labor market frictions are more likely to come into play, reflecting the scarring that has occurred over the last several months. It is unclear how much of this will lead to higher wage and price inflation, but pressures ought to be transitory.

    This Week – The economic data calendar is lighter. We could see some market reaction to the ISM Services Index (Monday). The report on producer prices (Friday) should continue to show inflation pressures at the earlier stages of production. For those interested in the global economic outlook, the IMF will revised its World Economic Outlook on Tuesday and Fed Chair Powell will speak on the topic on Thursday. FOMC minutes (Wednesday) aren’t likely to add much to the monetary policy outlook, but you never know (the financial press often pulls quotes out of context).

  • Can I Have a Do Over!?

    Sometimes hindsight really is 20/20 and other times we made big decisions because of the year 2020. For many people, the induced recession created a change in their finances, their income, or even their employment. Over the course of the last year I talked with a number of people who transitioned out of their career for one reason or another and consequently, many filed for Social Security sooner than they had once anticipated. Months later, I am now receiving messages from people who are sharing the good news that they are going back to work! For some, they are realizing they no longer need their Social Security benefits to provide their income and wish they had waited to file. Their question to me is, “can I get a do over?”

  • 3 Money Hacks in 3 Minutes

  • Weekly Economic Monitor – The Job Outlook

    By Scott J. Brown, Ph.D., Raymond James

    The Job Market Outlook – The U.S. economy lost 2.77 million jobs in the initial estimate for January, which is on par with what we saw a year ago (-2.79 million). Seasonally adjusted, this was recorded as a 49,000 gain (with private-sector payrolls up just 6,000). Still, accounting for the seasonal noise, the recent data indicated that the job market has cooled off significantly following a sharp rebound in the late spring and summer (payrolls averaged a 29,000 monthly gain over the three months ending in January). The slowdown reflects the pandemic surge (and efforts to contain it). The bigger test for the job market occurs from February to June, when payrolls normally ramp higher. The pandemic is likely to restrain job growth in the near term, but we ought to see stronger gains once vaccines become more widely distributed.

    This Week – The economic calendar thins out, with the Consumer Price Index being the only major data release. An increase in gasoline prices is expected to drive the CPI higher in January, while restraint on rents should keep core inflation on a moderate trend. Fed Chair Powell will speak to the Economic Club of New York on Wednesday. The topic is the current state of the job market.