00:00Well what I see is Kevin Warsh gets a break. He doesn't have to worry about the labor market. Didn't
00:05talk much about it yesterday. It does seem to be stable.
00:08Two hundred and twenty six thousand initial jobless claims and that's a decline from two hundred and thirty thousand which
00:15is revised up from two twenty nine last week.
00:18Either way you look at it it shows jobless claims relatively stable. They've moved up over the last couple of
00:23weeks but not significantly.
00:25The country is still maybe not hiring. A few more people they are but maybe not hiring in big numbers.
00:33But they're certainly not firing at this point.
00:36Continuing claims one million eight hundred and ten thousand do rise from one million seven hundred and eighty six thousand.
00:44So maybe some people are having a little harder time getting a job.
00:47But these are weekly numbers. So they do bounce around a lot. But the bottom line is it's not a
00:52major big deal.
00:53The Philadelphia Fed numbers are out as well. And the Philly Fed index rises to ten point three from negative
01:02zero point four.
01:04The prices paid index is at fifty three point two versus forty seven nine. So we still have inflation.
01:10That's no surprise given that we saw prices rise significantly during this war. We don't know how much or how
01:17often they're going to go down.
01:18But it does show business a little bit stronger in the Philadelphia area. So it does look like at this
01:25point the economy is in relatively good shape and the labor market is in relatively good shape.
01:30So if you're going to be the Fed and want to take something on it can be inflation.
01:35If you take a look at markets taking this all in stride as expected. Mike as you were mentioning there
01:40hasn't been a huge shift in the expectations or the labor market in terms of reasserting itself as a primary
01:46story.
01:47In the bond market you could see two year yields actually come in just a touch on this data.
01:51But otherwise across the board staying pretty much where you were the rally actually escalating on the 30 year yields
01:57four point eight six percent down seven basis points.
02:00As people take a look potentially to some weakening there. Mike I wonder how much the employment data has been
02:06de-emphasized as a result of the statement that we heard from the Federal Reserve unless it has to do
02:12with wages which more directly feeds into inflation.
02:15Well there's no wage pressure out there certainly because average hourly earnings and other wage measures have been dropping and
02:21they're now below the level of inflation.
02:23So if you're going to try to do something about wages it's probably going to be bring down the inflation
02:29rate so that people can get ahead a little bit.
02:31I think they basically are saying as long as the labor market doesn't show signs of falling apart we're going
02:38to completely focus on the inflation side of the mandate.
02:42It's been something that's been growing for a while concerned that they haven't hit the target in over five years
02:48the two percent target.
02:49And it's about time they do that or they risk the idea of inflation expectations getting out of control people
02:56thinking that inflation is going to be always higher.
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