00:00Well, John, it looks like we have our last clue before the payrolls report tomorrow, 208,000 jobs for unemployment claims filings.
00:09That's up from 199 was the initial report that's been revised up to 200,000 for the prior week.
00:16Now, remember, these are pretty low numbers, but we also had the last two weeks be holiday weeks.
00:21So we could see a jump up in the weeks after that.
00:24This does come after the Challenger job cuts this morning, released earlier, early than as expected by Challenger, down 8.3 percent,
00:33basically halving the number of job cut announcements in December and the lowest since July of last year.
00:40So it does look like the labor market is just kind of hanging in there at this point.
00:45We also get the trade balance, negative 29.4 billion.
00:49That's a shockingly low number.
00:51The forecast was for 58.7, and that should do some good in terms of pushing up the revised third quarter growth numbers when we get them.
01:04Exports were up 2.6 percent, imports down 3.2 percent.
01:09There's the reason we are not importing anything.
01:12A lot of imports going sideways because of the tariffs, no doubt.
01:16And finally, we get productivity, the first read on productivity for the third quarter, 4.9 percent, just a tick lower than anticipated.
01:25And it is up from 3.3 percent in the second quarter.
01:29Unit labor costs fall by almost 2 percent, 1.9 percent.
01:33They were up 1 percent in the second quarter.
01:36And this is important because if companies can get this kind of productivity, they don't necessarily need to hire.
01:41Remember, we had very strong growth in the most recent quarter, and it is a result of not adding a lot of people, but adding a lot of some sort of capital for productivity.
01:53And if that continues, then maybe we see companies still holding off on hiring while they wait to see what the Trump economic policies are going to be.
02:03Well, Mike, let's talk about the policy.
02:04Now, the following question highly dependent on the president's objective.
02:07But ultimately, is his policy working?
02:11Well, that depends on what his policy actually is.
02:16And I am not really joking about that.
02:19I'm trying to be serious in the sense that if the president's goal is to bring down the trade deficit, he's done that.
02:26It's the smallest since 2016.
02:29But that's basically irrelevant to the overall economy and isn't really going to make anybody's lives a little better.
02:36The productivity numbers are good.
02:38That's probably from AI, so I don't know that that has a lot to do with him.
02:42And the jobless numbers, the payroll numbers that we're seeing, are more a result of his policies and uncertainty about what's going to happen going forward as companies wait for further information.
02:54So it doesn't look like he's making a lot of progress, although if productivity were to continue at these levels, we would see it be disinflationary, and that might get him back on the affordability track.
Comments