Please listen to our weekly podcast summarizing our June 22 note and consider becoming a paid subscriber, if you are not already, to read the full note

You’re Really Going to Cut After Friday?

Following the May employment report, we reiterated our view that the obsession with the statistical noise monthly net change in employment rather than trends in labor market turnover risked getting the economic and inflation outlook wrong. We saw little evidence that the recovery in labor market dynamism and consumer spending from the negative wealth effect associated with the 4Q18 ECB/BOJ/Fed quantitative tightening stock market crash, had been interrupted by trade policy uncertainty. In our view, weak global trade explains soft growth in export dependent countries, however, the drift lower in ISM manufacturing was attributable to inventory destocking due to the transitory 1Q19 consumer spending slowdown. In other words weak global trade is having little effect on US growth.

Barry C. Knapp

Managing Partner

Ironsides Macroeconomics LLC

908-821-7584

https://www.linkedin.com/in/barry-c-knapp/

@barryknapp

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit ironsidesmacro.substack.com/subscribe