Listen: Economy Week Ahead: Services-Sector Activity, International Trade and More
"Jobs, jobs, jobs, jobs, jobs, jobs, good, better indifferent. Because it looks like it's pretty decent. Oh, I always going to be with you. Chad. Thank you for your kind words. You know, I think this is a much stronger than expected report we broke above the three hundred thousand barrier number of jobs added, and that's admittedly with a revised number four December which earlier was about three hundred thousand and gets brought back down to earth two two hundred twenty two thousand unemployment rate rose a bit that was because mostly the partial government shutdown. So that probably isn't a long-term consideration. But no, you have to say that everything that we've been working through in the US and global economy in recent months, averaging I think two hundred fifty four thousand jobs a month over the previous three months and ten years into an economic expansion one hundred. Straight months of jobs creation. Pretty impressive. Yeah. It is pretty impressive and late like a lot of us. Right. Thank start going. Really? Well, and we're always looking for that bottom to fall out. All the the things are going. Great. Don't don't mention anything. Things are going great. And and people are looking around. And and wondering when is that bottom gonna follow it is that going to be that I scary thing. I mean, I read today that Italy might be heading towards a recession or in a recession. And everybody's always looking for that first factor that I indicated there's going to be some issues. Well, I do think that at this point the US economy is the stellar economic performer around the world right now and western Europe is worry you have Bracha US, China, China, obviously weighing on a lot of corporate earnings coming and recently, everybody from apple to Invidia and that underscores the pressure on the US and China to work out a trade agreement and you're right. You know, we do always want to say, okay, we're good now. But what about tomorrow about I'd say for the foreseeable future? It looks as if the expansion. Continues to home right along. And you know, looks like we'll probably in two thousand eighteen with an annual growth rate of about three percent will probably do a little better than two percent for this first quarter, which tends to be one of the week or quarters of the year, at least in terms of trying to measure it. So and then, of course, the impacts from the partial government shutdown what you'll be resolved in the coming weeks. Meaning while we destroyed an economic activity that won't ever come back with the economic activity that was delayed meaning paychecks that didn't have money to spend that money will be spent. So so far so good. Talking to Mark Hamrick. bankratEcom breakdown the economic news. You talk about the government shutdown, and again, it will resolve itself over the next couple of weeks as far as looking back and see what kind of damage was done what kind of damage you was actually done. Well, first of all there was the damage that individuals, right? There was the damage to individuals who aren't don't have substantial savings, and you know, Bank rate has done these surveys for a long time that have found that close to only forty percent of Americans have enough in their Bank accounts to pay for an emergency expensive one thousand dollars or more. And so this reminds us that whether it's a a partial government shutdown and eruption our own employment. A storm of some kind that keeps us park for a few days or something else we do need to have that emergency savings. So that's the personal impact that is real. And so within this report we see that there were five hundred thousand people working part time in the private sector. That would have liked to have had fulltime. Work added Justin the single month a half. A million people were affected in the private sector with a not having fulltime work. So that's one thing. We have knew that there were four hundred thousand workers of thereabouts in the federal government that were furloughed and essentially considered temporarily unemployed. Yes that was temporary. But we know that from all the reporting we saw during that period that that was having real impact on people. But to your earlier point. Yes, most of this will be restored. I do worry about the lack of the federal government's ability to attract and retain workers because I think the the allure of that has been dealt some damage with three government shutdowns in a year. Now. Yeah. Which is which again is is it just shows you how bitter nasty it gets. And and and how we can't even I mean, if we look up we said, the sky's blue even if it is they're going to argue and say, well, it's probably cloudy somewhere. And that's that's a sad situation. That doesn't do us any good talking to Mark Hamrick. bankratEcom as we discussed the economy. Trump should be out touting this and one of the things they should be talking about this not getting talked about the mainstream media because it's not salacious is. The fact that China is feeling the effects of the trade kerfuffle, it's not really a war war. But the trade kerfuffle, they're really feeling the effects, and that's not that's not really being talked about. Well, it is among those that are interested in these things. But you're right. I, you know, I guess one never at least I'm at the point where I can't try to put my arms around what the administration says why? And and what a dozen say, but you know, this week we had the Chinese delegation in Washington and the president. Both both the president and his counterparts early were playing nice at appeared and gave hope for this agreement ahead of the March first deadline, but you're right. I do think that China is seeing more pronounced slowdown than had been expected. And as China goes really so goes much of Asia because as as the global economy interconnected so are the Asian economies. And and so it probably is an accurate observation to say that to some degree. There's more pressure on China, but you know, when you essentially have a totalitarian regime, which does not respect us civil rights. So they have also means to let's say come up with quote unquote solutions that aren't practical or even possible in a democracy. No. But one thing I've always said about capitalism is the thing that breaks down those walls is the fact that eventually, even if you give them freedom to a certain extent, economically if you take that away, and they've already had all their other freedoms takeaway that's going to break faster than if you didn't have anything to begin with. So wait a minute. You've taken away my Friedman think it all of this kind of stuff, and you gave me some economic freedom. Now, you taking that away. And I think that's a real worry over there is how do we control this because this isn't Tiananmen Square? We've got freedoms now economically, and you take that away and that could get ugly fast. Well, I do think that always underscoring what China's doing is an understanding that civil unrest is always a risk. Right. And so as it is in most countries, so. Absolutely. So that's why they need a stronger growth on basically almost everywhere else in the world. And and I ultimately it is to their benefit as it is to the United States to have a large framework and understanding of of how our trade should try to meet the needs of both sides. What's it like to? I mean, 'cause I hear all kinds of stories of what it's like to operate a business every got friends who've done it and the way that the Chinese government just comes in. Mark is is basically they want all of your stuff. They want to know everything you're doing they want everything they possibly can know about you. And they take it. And they essentially by the by the sounds of it's kind of handed out to all of the other Chinese what would be your competitors. But it's part of the cost of doing business over there. Well, you know that gets to the whole part of the most difficult aspects of the discussion that if there's anything that probably stands on the way of having an agreement in the near term. It is the aspects that have to do with so-called intellectual property, and you know, essentially when one is operating in China. You don't have the ability to control even perhaps access to your hard drives or the data that you're sending abroad. And that means that everything that you design, everything you produce, everything you write about in communication is at risk of essentially being hijacked, and I think that longer term that is more the concern because what is the great what what are some of the great things about the US economy. It's our inventiveness our to our ability to innovate, and that's why we have so many wonderful products and services that originate in our country that don't originate anywhere else. But if we don't have the ability to protect those things under something that's akin to a rule of law, then their value sharply diminished. And so that's why intellectual property and trademarks and patents. And all those things are really at the heart of what is probably even from a numerical standpoint. The most valuable part of this discussion talking to Mark Hamrick. bankratEcom appreciate you coming on one. Last question of fourth quarters. The earnings are coming out of the retail this stuff, you know, Christmas. All of these things are we looking, you know, I mean, some things seem to be good. Some things seem to be bad. Some of that might play into the fact that we're in this kind of kerfuffle with China's specimen comes to electron IX and things of that nature. But all in all seem like we're you know, that it was a decent fourth quarter last year. Well, I mean, I think obviously had a significant rise on the stock market's value from that Christmas Eve low, but the question is how much should you be discounting future earnings? And that's a question that I don't think that I can give you an affirmative answer to meaning the markets had a pretty strong rebound. We're we're getting closer to a behind that. We're seeing last year. And do you have reason to be very optimistic about the future earnings and buyer, but I think you can paint the picture as to how that can happen. But do you have, you know, a a strong confidence? So that's actually going to happen across the board. I think I think you probably need to see more evidence that the us and global economies can hold up, and that there is a there is a resolution of U S, China trade. But the other part is now with the Federal Reserve, basically saying, well, you know, we may be done with interest rate hikes. Now, if indeed that's the case, then they're the you know that there's the positive side of that where the market. Loves that. But there's a part of it that the market should love. Which is if the outlook is so cloudy that the fed doesn't feel like it can raise rates anymore. You know, that tells you something about the overall strength of the economy. Absolutely bad. You are the man the legend Mark Hamrick. bankratEcom who'd he got this week in the Rams the patriots. Well, funny. I was going back and forth with that when my colleague Greg McBride who died in the wall Steelers fan, and I said first of all you have to admire and acknowledge the Tom Brady is a beast. But and so are the patriots for all the reasons that they've won. But there's just a part of me that says that you know, I can't cheer for them. But you know, you might say that the risk is they win. But because I always pretty much love the underdogs. I'm gonna I'm gonna hold that somehow Los Angeles can pull this out."