Market Watch: Forget the Wall Street carnage: To read the economy, look at how much Americans are eating out

Published: Oct 14, 2018 10:57 a.m. ET By JEFFRYBARTASH REPORTER

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“A good way to tell how Americans are feeling is to look at what they spend on restaurants.

“Those are wants and not needs,” noted senior economist Jennifer Lee at BMO Capital Markets. Put another way, people dine out more when the economy is doing well and they’re not worried about losing their jobs. They eat more at home when times are tough and they’re counting pennies. Continue reading “Market Watch: Forget the Wall Street carnage: To read the economy, look at how much Americans are eating out”

Chuck Jones Contributor | Jul 28, 2018, 12:08pm

The Bureau of Economic Analysis at the U.S. Department of Commerce announced that the U.S. economy grew at a 4.1% annual rate in the June quarter. This is the highest rate since June 2014’s quarter result of 5.1%. The 4.1% is a solid increase from the March quarter’s 2.2%, but a little short of many projections. It is worthwhile to take a look at some of the underlying components that had an impact on the final number, starting with rounding that increased the result from 4.0% to 4.1%.

When the actual $18,507.2 billion GDP output is compared to last quarter’s $18,324 billion and multiplied by 4, the result is 4.0% (and 3.999% when expanded). The 4.1% calculation comes from adding the various components that make up GDP, such as personal consumption, private domestic investment, exports & imports and government spending.

The next item to note is that the calculation uses one-quarter changes and multiplies them by 4. This means that any component that had an unusual increase or decrease in a quarter gets magnified. This becomes even more important when something such as impending tariffs gets multiple players to shift their production or sales into one quarter vs. another, as can be seen in the June quarter export results. In theory, this should be offset in the next quarter, which is why it is important to take a look at growth over a year or longer timeframe. From a year ago GDP grew at a 2.85% rate. [MORE: Go to link here.]

Expects to continue raising rates in near future

July 5, 2018 Kelsey Ramírez

The Federal Open Market Committee released the minutes from its June meeting Thursday, where the committee elected to raise interest rates for the second time in 2018.

The minutes showed the Federal Reserve is not concerned about the rising threat of a trade war or other economic disruptions.

Many economists are predicting disruptions to not only the U.S. economy but also to the world, predicting gross domestic product could drop by 0.1 percentage points in the U.S. and 0.4 percentage points worldwide due to President Donald Trump’s trade war.

And while the Federal Reserve did mention some global economic challenges during its meeting, they were not the focus and did not seem to affect members’ predictions for the future of rate hikes. [MORE: Go to link here.]

JUL 7, 2018 @ 12:12 PM 233 How The June Jobs Report Could Affect Your Finances Teresa Ghilarducci , CONTRIBUTOR I am an economics professor focusing on retirement security and jobs. Opinions expressed by Forbes Contributors are their own.

The June report was a doozy. If labor markets remain tight and wages don’t increase, profits will soar and that would be good for stock prices and your retirement plans. Right? Not so fast.

Being able to save for retirement depends more on wages than rates of return, and a backlash against workers being left behind could destabilize markets. The dynamics depend on how answer to this puzzling question:

How can the labor market be so tight and wage growth so flat? [MORE: Go to link here.]

When Strength Creates Weakness. Imagine a country with a mere 8 million people, whose popular claim to fame is watchmaking and an army knife, landing on the headlines of the financial newspapers around the world! Yes, it’s true. Last week, this quiet and unassuming little country of yodelers, with a GDP of only .43% of the rest of the world, wreaked havoc on the balance sheets of big banks around the globe. Continue reading “A Franc Discussion”

The last three months of 2014 have brought us some very good financial news. Here are the highlights of 4Q 2014 – together with potential upsides and downsides for 2015:

Interest Rates and Stocks. Notwithstanding the voices of doom and gloom predicting that interest rates would spike when the Federal Reserve tapered its Quantitative Easing (“QE”) program[1] beginning at the end of 2013, it didn’t happen. QE finally ended in October 2014, and interest rates have actually continued to drop a bit. [See Bankrate table here.] This has been very good news for homebuyers, car buyers, and purchasers of other capital goods, such as equipment and machinery. Continue reading “2014 Ended On A Good Note – How Will it Affect 2015?”

According to a recent Wall Street Journal blog, here, the President of the Federal Reserve Bank of San Francisco, John Williams, says it will be another year before the Fed begins raising interest rates. If the definition of “news” is “something new” this observation is not “news.” Nevertheless, the article is newsworthy in one sense – it confirms pretty much what mainstream economists and the Fed have been saying for some time. To that extent, its consistency is newsworthy. Here is a thumbnail of what appears to be the general economic consensus regarding interest rates today: Continue reading “Interest Rates, ‘Reverse Repos,’ and Liquidity Risk – What Happens When The Fed’s Bond Buying Ends?”