In his podcast addressing the markets today, Louis Navellier offered the following commentary.
The Labor Department announced on Thursday that weekly unemployment claims declined to 228,000 in the latest week, up from a sharply revised 246,000 in the previous week. Continuing unemployment claims rose to 1.718 million in the latest week, up from a revised 1.649 million in the previous week.
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The four-week average of weekly and continuing unemployment are now rising, so it is possible that the unemployment rate may rise again after rising to 3.6% in February, up from 3.4% in January.
ADP reported on Wednesday that private payrolls rose by just 145,000 in March, down from a revised 261,000 in February. Nela Richardson, ADP’s chief economist, said “Our March payroll data is one of several signals that the economy is slowing.”
Richardson added that “Employers are pulling back from a year of strong hiring and pay growth, after a three-month plateau, is inching down.” As further evidence that employers are pulling back, the Labor Department reported on Tuesday that its JOLTS report showed that there were 9.93 million available jobs in February, which is 632,000 less than January’s revised number.
This is the first time that job openings fell below 10 million in nearly two years. As a result, the expectations for Friday’s March payroll report is now being lowered by most economists.
U.S. Dollar Losing Mojo
The U.S. dollar is losing its mojo as the U.S. embarrasses itself around the world with our political infighting. On Tuesday, when former President Trump was charged, Treasury yields declined significantly in a flight to quality, while gold and many cryptocurrencies rallied.
Hopefully, our political soap opera will be over sooner than later, because the U.S. has lost much of its credibility around the world.
Lost Decade
The World Bank is warning of a “lost decade” for global growth and is citing the war in Ukraine, the Covid-19 pandemic and high inflation. The Washington D.C. bank said in a report that “it will take a herculean collective policy effort to restore growth in the next decade to the average of the previous one.”
The World Bank added that “Across the world, a structural growth slowdown is underway: At current trends, the global potential growth rate … the maximum rate at which an economy can grow without igniting inflation … is expected to fall to a three-decade low over the remainder of the 2020s.” Ouch. I think the economists at the World Bank need to be treated for depression.
Speaking of being depressed, the International Monetary Fund’s managing director, Kristalina Georgieva, on Thursday warned that the global economy is facing years of slow growth, with medium-term prospects the weakest in more than 30 years.
Specifically, Georgieva said that the world economy would expand at a 3% annual pace for the next five years. Georgieva said, “The path back to robust growth is rough and foggy, and the ropes that hold us together may be weaker now than they were just a few years ago.”
She concluded by saying that the weaker economic outlook would make “it even harder to reduce poverty, heal the economic scars of the Covid crisis, and provide new and better opportunities for all.” Yikes.
Rolling Recession
The Atlanta Fed lowered its first-quarter GDP estimate to an annual pace of 1.5% for the first quarter. Due to higher crude oil prices, some economists are now lowering their GDP estimates.
Since the manufacturing sector is definitely in a recession, the best way to describe the current environment as a “rolling recession” as my favorite economist, Ed Yardeni, likes to say.
Coffee Beans
A remote Japanese town has taken to selling bear meat from a vending machine, sourcing its supply from Asian black bears, listed as a vulnerable species, caught in traps or in the mountains by hunters.
The owner of the vending machine, Daishi Sato, said bear meat isn't very common so he wants tourists who come to visit the town to try it. Source: Reuters. See the full story here.
