Notes on the Week Ahead

The key to a successful career in economics, as in weather-forecasting, is never to be too precise. In the middle of winter, you won’t hear a meteorologist forecast five inches of snow for Central Park. However, she may well tell you we will get between four and six inches – her forecast thus indicating both what she expects and her personal doubts regarding that expectation.

"Ahem….I'll just leave the bill here, then. No rush at all – please take your time." The obsequious waiter leaves the check on the table but the Sopranos, loudly enjoying an excellent dinner, ignore it entirely and demand more lobsters. Paulie orders some champagne for some women at a table in the corner. There is some question as to who will, in the end, pay the bill. But for now, no one pays attention.

We live in an age obsessed with healthy food choices and I am at an age when I should be making them. However, on Saturday, I threw caution to the wind and walked down to our local pizza shop to pick up dinner. 

The week ahead should provide plenty of evidence of a continued heating up of the U.S. economy. The ISM and Markit surveys on Services activity should remain at strong levels while International Trade data, due out on Friday, could add to evidence of roughly 5% real GDP growth in the second quarter. Payroll Employment, also due out on Friday, should show a healthy, roughly 200,000 job gain with the Unemployment Rate potentially falling to a fresh 48-year low of 3.7%. Meanwhile, the Average Hourly Earnings of production and non-supervisory workers could accelerate to growth of 2.9% year-over-year, suggesting that the labor shortage is finally putting some upward pressure on wages.

With most of the planet glued to the World Cup, I’ve been trying in the last few days to revive an interest in the beautiful game that has lain fallow since my childhood. Like baseball, the more you watch it, the more you realize is going on and I sometimes pity the job of the coach who has to drink in and analyze all the action in the first half and then find some way to explain it to the team in a distracted 15 minutes of halftime.

Every year, my wife and I buy increasing amounts of stuff from their shelves but they never seem to want to buy what I have to sell, which is primarily investment ideas and speeches. I should perhaps mention that we also run deficits with Whole Foods, CVS, the cable company, the electricity company, the auto service guys and a myriad of other business.