Jim Rogers: There's a 100% Probability of a U.S. Recession Within a Year
Rogers ticks off the things I am concerned about including China, Europe, and the world economies. He also nails the fact that the flight to security will be to the US dollar, US equities, and debt, both corporate, and government. The strong dollar means we should see trade deficits continue, but the counterpart to this is that money returns as investment back into the US. We seem to forget this second part of the Trade Deficit/Foreign Investment pair. It is here Trump shows his economic ignorance.
Unless we are already in a recession there is never a 100% chance of recession, it might be high, but nothing is assured.
Payrolls in U.S. Surge While Wages Drop in Mixed Jobs Report
Like I said, mixed!
This is actually bad news, if the economy were better we would likely see a continued reallocation of resources towards family, and away from work. But because the economy is flat in most of the country, people feel the need for the low/non earner in the family to get out there and make a buck.
Labor Force Participation Improves; 93,688,000 Americans Not in Labor Force
As I have said before, the labor force participation rate changed in about 1970 after the Woman's Rights, and Affirmative Action movements opened the economy to women, and coloreds. Before 1970, we had a Labor Force Participation Rate (LFPR) of about 58%, after, it rose to about 68% by 2000 or so. Families liked the money, but the LFPR increase was artificial, and in 2008 the bubble popped. The economy dropped, and many were laid off. The result was many families who were left with the primary earner still working found that the income loss after taxes was less than they thought it might be, and when combined with the additional costs of day care, elder care, housekeeping, lawn care, among others they may have actually gained value by keeping one spouse home. Others near retirement found ways to making do, living more frugally. But all seem to prefer the new arrangement. This is supported by the low unemployment rate, and until now the lower LFPR.
Another support for this proposition is the recent rise in wages. What happened during the LFPR rise was women and coloreds were add to the workforce, but only added a marginal additional amount of productivity. As a result, wages "stagnated" according to the Democrats. (This is incorrect for many reasons one for example is that the costs of products and services declined dramatically. Prosperity is not dependent on wage rise, if consumer prices for goods and services fall. In the end, the individual is more prosperous.) The recent wage rise is simply redistribution of total wages over a smaller number of more productive workers.
It is unclear whether the current wage decline in temporal, or if it will become a consistent feature of the economy.
U.S. trade deficit widens as exports hit 5-1/2-year low
Meaning that export industries will be more likely recessionary. This is due to both the strong dollar, which is due to the world wide flight to security, and to the fact that the world's economy, as well as the Russian, Chinese, Japanese, European, Eastern European, Brazilian, and now Indian economies are all taking a powder. The world is simply not in a position to buy US exports.
But . . .
Yeah, woo hoo. Today I am more concerned with the rest of the worlds economy than I am with lagging indicators. I am not on board with the recession cabal, but I am becoming more persuaded over time. I think we are likely to have either a recession or a very weak, stagnant near zero growth economy, I do not see solid growth based on the current economic numbers.