US Commerce Department Report
The Thursday retail and food-services sales rose 0.8% in October to $511.5 billion, exceeding expectations of a 0.5% monthly advance. With October’s reading, U.S. retail sales are up 4.6% from the same time last year
Fed Chair Powell, who on Wednesday (November 14, 2018) while speaking with Dallas Fed President Robert Kaplan, appeared to indicate his growing concerns of the worldwide slowdown starting to reach the U.S
FEDs Rate Hike
On a different Positive View – Keeping in mind that I’m currently viewing anything indicative of a slowdown as a positive as it may cause Fed Chair Jerome Powell to reconsider his three rate hikes in 2019 forecast – core retail sales (i.e., retail sales excluding autos, gas, building materials, and food services) were up 0.3%
US Economic Outlook
- Non-store Retails sales
- Sporting Goods Sales
- Restaurant/Bars Sales
The Department of Labor reported that initial jobless claims for the week ending November 10 were 216,000, an increase of 2,000 from the previous week’s unrevised level of 214,000. The reading came in 4,000 claims above expectations of 212,000. Importantly, the four-week moving average for claims (used as a gauge to offset volatility in the weekly numbers) was 215,250, an increase of 1,500 from the previous week’s unrevised average of 213,750. The low rate of layoffs reflects a strengthening labor market as claims have remained below 300,000 — the threshold typically used to categorize a healthy jobs market – for an incredible 193 consecutive weeks, the longest streak for weekly records dating back to 1967. The previous longest stretch ended in April 1970 and lasted for 161 weeks.
Brexit, EU or global issue?
For two years, observers have speculated that June 2016, Brexit campaign in the U.K. served as a petri dish for Donald Trump’s Presidential campaign in the United States. Now there is new evidence that it did. Newly surfaced e-mails show that the former Trump adviser Steve Bannon, and Cambridge Analytica, the Big Data company that he worked for at the time, were simultaneously incubating both nationalist political movements in 2015. In an interview with France President Emmanuel Macron states,
How and whether all of these pieces fit together is the subject of Mueller’s investigation, but the lack of a similar single, overarching research in the U.K. has led critics to call for one. Emma Briant, for instance, who has submitted the new e-mails to the British government for further investigation, told openDemocracy that “this evidence shows that Banks was seeking foreign funding for Brexit from the very beginning.”
The current global expansion will likely continue into next year, given that the US is running large fiscal deficits, China is pursuing loose budgetary and credit policies, and Europe remains on a recovery path. But by 2020, the conditions will be ripe for a financial crisis, followed by a global recession (over 60 since World War II). This is two reason why
- US economy is overheating, inflation is rising above target, and will be 3.5% by 2020 (current rate is 2%).
- US Trade dispute with China, Europe, Mexico, and Canada are leading to slower growth and higher inflation