* First official jobs report of Q2 * Wednesday's ADP private payrolls were below expectations * March was revised down, indicating a softer labor market * Challenger job cuts numbers well above previous month, biggest year over year increase in 10 years * The jobs number came in at 222,000 jobs with unemployment down to 5.4% * The media is spinning the headline number * The picture underneath the jobs report is not as nice * The March downward revision by 41,000 jobs causes one to question whether today's job number will be revised downward given all the negative underlying data * The stock market recognized this; sensing the Fed will remain on pause * Average Hourly Earnings increased only .1%, half expectations * Numbers of Americans who have left the labor force is now at a record high * When employers are changing the nature of the workforce replacing full time workers with part time workers it distorts the net number of jobs * The Household Survey indicates the breakdown of full time vs. part time * The government makes no such distinction * In April we created 437,000 part time jobs - biggest gain in part time employment since last June * The number of full time jobs declined by 252,000 - the biggest drop of the year * The bad news of full time job loss is buried beneath the superficial layer of part time jobs * The demographic breakdown indicates workers 55 and older gained 266,000 jobs in April * Workers 25 - 54 lost 19,000 jobs * This blows a hole in the notion that labor force participation is going down because of retiring baby boomers * Other bad news to hit this quarter's GDP: * Wholesale Trade numbers: inventories expected to rise by .3% but rose by .1% - smallest gain since March of 2013 * Wholesale Sales expected to break 3-month losing streak; instead increasing streak to biggest year over year decline since November of 2008 * Earlier in the week, Q1 Productivity down 1.9% following 2.1% decline last quarter * Unit Labor Costs rose more than expected +5% * Challenger numbers show a big explosion in layoffs * The reality is that the economy is weakening rapidly * The Fed and the media don't want to acknowledge this because they are afraid of how the market will react * Recent encounter with Former Fed Chairman Ben Bernanke * Ben Bernanke was a speaker at the SALT conference * I introduced myself to him after his presentation, told him "I am probably your biggest critic." * He responded, "You have a lot of competition." * Later that evening at a cocktail party I approached him and he offered to pose for a photo. * Photo got more views and likes that most other photos on Facebook * I tried to give him a cliff's notes version of my take on the Fed's part in the housing bubble * Bernanke blamed regulations, Fannie & Freddie and the sub-prime mortgages * I said the Fed created the conditions for Sub-Prime mortgages because low interest rates made them affordable * I asked why he did not warn us in advance of the regulations, Fannie & Freddie and the Sub-Prime Mortgage business? * Bernanke originally denied the housing bubble existed * Ben Bernanke had no clue that the Fed's policies created the bubble even after it burst * In hindsight, he lays blame on aspects of the market that he should have identified in advance * I asked him, "how can can you be sure you were right, when interest rates are still at zero and the Fed's balance sheet still hasn't shrunk? * Is there anything that might change your opinion that your decisions were right? * He evaded the answer, but I believe he was sincere about his opinions * Later that evening,Our Sponsors:* Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD* Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.comPrivacy & Opt-Out: https://redcircle.com/privacy

Ask this episode

“What did the council decide on item 42?” — answered with the speaker and the moment.

Transcript

Related