US Economy: “Humming Along Just Fine”

Numbers for the end of October show that there was a 3.1% increase in wages and salaries (according to the Employment Cost Index – ECI) and 227,000 jobs created (far exceeding the actual expectation). US economy clocked one of its best six month stretches in the past decade with growth up 4.2% in the second quarter and 3.5% in the third quarter.

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US Consumer: “In Good Shape”

The current state of the average American consumer, is, according to CEO at The Hershey Company, Michelle Buck a good one. Americans’ confidence in the economy is positive. Brian Cornell feels similar.  As CEO of Target he sees similar activities to his peer Buck, purporting that the “consumer environment may be the strongest [he’s] seen in [his] career.”

One reason for this – Cornell believes – is because Americans are “seeing wages rise.”  According to entrepreneur and investor Kevin O’Leary, it is the “small domestic companies” we have to thank for this.  He said:

“Small domestic companies are the unsung hero of the policy that’s emerged from this administration.”

With a staggering 6.7 million job openings seen at the end of  June 2018; a situation which has been described as “an unprecedented imbalance.” Indeed, as numbers from the Department of Labor show for the end of October, 2018 the amount of people receiving extended jobless benefits – 1.636 million – is the lowest since 1973.

O’Leary further explained that:

“We are having the best year ever — ever in the last decade,” O’Leary said. “The deregulation in the state and the municipal and the federal level has given confidence to these operators to do something they haven’t done in 10 years: to actually take out loans and invest in their businesses, and create jobs, and increase sales, enhance margins, scale up.”

Still, there is some cause for concern since there are currently 7.14 million job openings, which basically means Americans are not skilled enough (or too lazy) to fill these positions.  So there needs to be some work on job training and career guidance.

The midterm elections and policy-making from now until 2020 could have a substantial impact on this.

Market Alert

Martin Feldstein – Economics Professor at Harvard University – reports on FOX Business on “how the Trump administration reached a trade deal with Canada and Mexico. Feldstein also discussed the current state of the U.S. economy.”

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