Did August Jobs Ready Fed for Sept. Rate Hike?

Did August Jobs Ready Fed for Sept. Rate Hike?


* Earlier today we released the most important Non-Farm Payroll report ever, at least according to the media
* A WSJ article stated that this report could "seal the deal" on rate hikes
* Interest rates have been at zero for 7 years as the Fed contemplated lift-off
* It all boiled down to one jobs report?
* If the Fed were going to raise interest rates in 2 weeks, how can it count on its accuracy or the fact that numbers will change next month?
* Let's get into the numbers:
* The number we got was 173,000 - well below the consensus forecast
* One of the weaker components was private payrolls, which only grew by 140,000 vs and expected 211,000
* The headline number is the unemployment drop to 5.1% - the lowest in the Obama presidency
* Once again, the devil is in the details
* The unemployment rate is falling because of the mass exodus from the labor force
* Another 261,000 Americans left the labor force this month
* The participation rate held steady at 62.6%
* The lowest rate since 1977
* I think it's heading lower
* The total number of persons not in the labor force rose to a new record: 94,031,000
* Also this month another 158,000 Americans find themselves involuntarily employed part-time
* That's what's responsible for the "improvement" in the labor numbers
* Janet Yellen specifically wanted to an increase in labor force participation and more full-time jobs before contemplating raising rates
* Those numbers have gone in the wrong direction
* Why is nobody pointing this out?
* This is the 9th month in a row that year-over-year factory orders have declined
* The only other time that has happened is during recession
* Every time we've seen a sharp decline in the market accompanied by an increase in the volatility index, the Fed has responded with Quantitative Easing
* More and more people now do not believe the Fed will raise rates in September
* If the Fed raises interest rates and the market keeps falling and the economy rolls over, the Fed loses a lot of credibility
* This is affecting global markets
* The Dow is now in correction
* I pointed out in my last video blog that: a) the Fed has never raised interest rates from zero and b)normally the Fed raises interest rates into an accelerating economy
* This time the Fed is raising interest rates when the economy is weakening
* This time a rate hike will prick a much larger bubble
* Even if the Fed raised rates to a quarter of a percent, that is still cheap money
* The markets are forward-looking and they are not going to like what they see
* The dollar strengthened on anticipation that the Fed will raise rates
* America cannot afford higher interest rates on the debt we have now
* One of the things most people overlook is the huge stockpile of U.Ss treasuries that are held abroad
* Why do the emerging markets have so may dollars?
* In the aftermath of the 1997 Asian economic crisis, they bought dollars as a reserve to defend their currency if it started to fall
* That is happening
* So now, foreign governments are going to start drawing on their reserves, selling treasuries to shore up their currencies
* The vast majority of the accumulation happened after QE1, when we had a currency war
* The media has labeled this sell-off "Quantitative Tightening"
* China has already started to gradually sell treasuries
* The Fed has promised not to roll over maturing treasuries and to shrink the $4.5 trillion balance sheet to about a trillion
* That's $3.5 trillion of Quantitative Tightening
* Interest rates would have to rise dramatically to attract real buyers to U.S. treasuries
* No one can afford higher rates, Our Sponsors: * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

Avsnitt(1081)

SchiffRadio Podcast Episode 8

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This week, we're releasing a series of podcasts to get current information out on a more basis. We appreciate your feedback on this new format. Episode 8 Segment 1: * Contrary to GDP number, consumers are still struggling. Our Sponsors: * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

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SchiffRadio Podcast Episode 6

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SchiffRadio Podcast Episode 5

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SchiffRadio Podcast Episode 3

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SchiffRadio Podcast Episode 2

SchiffRadio Podcast Episode 2

SchiffRadio Podcast Episode 2 Synopsis * Economic Data - More weak data * Purchase applications index declined by 7.2% - biggest decline in 14 years * Treasury yields slightly up for the week * Retail sales up - Buying more or paying more? * auto purchases with cheap money * inflation not taken into account * Auto loans increasingly delinquent * Fed Policy * I'll admit to being wrong if the Fed raises interest rates back to normal and shrinks its balance sheet back to normal, as promised, and does not produce a financial crisis. * Interest Rates * Negative Interest Rates in Japan and in Switzerland * Inflation * Paul Krugman says we should be at 4% inflation and a minimum wage of $10.10 * Commentary on Henry Blodgett's inflation comments * Column from David K. Johnson on how corporations are getting rich by paying taxes * Employment * Jobless claims up, indicating a trend change * The Economy * Recognizing bubbles ahead of the crisis * Europe - Poll on Scottish independence * Social Issues: * The NBA in the hot seat for racism * Over-reaction to the Ray Rice story Our Sponsors: * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

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Schiff Radio Podcast Episode 1

Schiff Radio Podcast Episode 1

Schiff Radio Podcast Episode 1  Synopsis: * Wall Street foolishly dismisses August's horrible Jobs Report * ECB cuts rates in misguided push for higher inflation. * "Shrink-flation," what is it and why those using the term still don't get it. * Implications of Switzerland's coming gold reserve vote . * Protesting Fast food workers determined to put themselves out of work. * Does Alibaba's biggest IPO in history shows portent more interest in foreign stocks? * Countrywide's Anthony Mozilo is not the real villain. * NY Fed concedes 25% of college grads wasted their time and money. Our Sponsors: * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

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