Today marks the start of the last full week to file taxes. We have been seeing a decline in consumer sentiment lately, and the recent jobs report is certainly no booster. What do you believe needs to take place in order for consumers to invest their tax refunds into the economy instead of their savings accounts?
Morning Commentary
By Charles Payne, CEO & Principal Analyst
4/6/2015 6:37 AM
Maybe it was a good thing they released the March jobs report when they did even though the stock market was closed on Friday. It was a stinker and it would have ruined a lot of weekends. With 126,000 jobs added, the actual number was about half of the 245,000 consensus, and among the experts, it was the lowest tally since December’s consensus of 213,000.
The number is so out of whack as the lowest analyst estimate on the Street was 190,000. Now, everyone's scrambling to find out what's next as it is harder and harder to ignore the never-ending string of economic disappointments. The irony is that the number makes sense when it is juxtaposed with everything we hear from Main Street and the recent actions of the consumer.
In this report, the devil was in the details as the key points were disappointing.
Key Points
- Labor Force -96,000
- Participation Rate 62.7%
- Hourly Wages $24.86 +2.8%
- Jan & Feb Revised -69,000
In fact, I am already seeing the experts and apologists playing the blame game. There’s no doubt plunging oil is taking a toll on the industry, although the recent layoffs is not a part of the data. The strong dollar is to blame, even though we were told that it would be a boon for the economy and the consumer. Then, there was the weather…
However, I guess the experts cobbled together their consensus estimates from a beach in the Bahamas.
No one saw this coming…so now what?
The Economy Hits a Brick Wall
The economy has hit a brick wall; lost in the shock of the jobs numbers, the Atlanta’s Fed release stated that the first quarter of the gross domestic product (GDP) would be 0.0%, which is a significant difference from the 1.9% at the start of the year.
|
First Quarter GDP |
|
|
January 1, 2015 |
1.9% |
|
April 3, 2015 |
0.0% |
Just like that, it seems that all critical aspects of the economy came grinding to a complete halt, and in some cases, it has been in an absolute plunge-mode.
Technical Support
Right now, the supporting key points for the Dow are 17,635 and 17,164.
Today’s Session
The markets have opened lower as anticipated with the lousy jobs report still pressing on the minds of market observers. Surprisingly, gold futures are trading near 3-week highs as the low jobs number indicates that the Federal Reserve should refrain from hiking rates in the near-term.
| Comments |
| looks like all the job 'growth was in retiree age cohort. Suggests retirees are struggling. http://research.stlouisfed.org/fred2/graph/?g=16tp Papaswamp on 4/6/2015 8:26:32 AM |
| spend vs. save: when people don't have to use their "mad money" (aka "rainy day" money) for groceries or rent. when $70K jobs return rather than $7/hr jobs are created. ira haron on 4/6/2015 10:20:03 AM |
| So, who's really surprised? We have an extremely anti-business, anti-growth administration. As you sow, so shall you reap. Steve R on 4/6/2015 10:20:27 AM |
| My impression is that all of the polarity among people, whether it is politics, race, unions, climate change etc, is reaching an explosive point. When you couple this with all of the wars/conflicts going on, it breeds uncertainty. With an almost complete lack of leaders that are willing to lead with common sense, I think people are becoming apprehensive. What is needed are leaders with a vision that can be well articulated and understood without inflammatory rhetoric. But then who would listen? David Huber on 4/6/2015 10:43:12 AM |
| The business sun will shine again when Valerie Jarrett and Company move out of the White House and business friendly people move in, I don't care from what party....... tom wayne on 4/6/2015 10:46:38 AM |
| I and my wife are part of a growing group of elderly people whom will never be able to retire. Due to our governments mistakes giving money to people who could never pay it back we had a crash like non in my 67 years of life. Lost Our home and business of 35 Years. There are not enough Survivors. dennis king on 4/6/2015 11:42:35 AM |
| Repent, turn away from sin and return to our Christian roots. I know this may sound odd to most. This destruction of our economy is a warning from God to repent and turn back to Him and pray for salvation. David on 4/6/2015 1:23:53 PM |
| A REDUCED PACE MAY INCREASE CONCERN AND STIMULATE SAVINGS TO THE LOSS OF UNNECESSARY CONSUMPTION AND INVESTMENT. BUT SAVINGS, INCLUDING SANE INVESTMENTS, IS WHAT IS NEEDED IN THE COUNTRY TO BUILD REASONABLE CAPITAL FOR RETIREMENT. WE NEED LESS TRADING AND MORE VALUE INVESTMENT, INCLUDING DIVIDEND INCOME, TO BUILD FUTURE FINANCIAL INDEPENDENCE. Harold Sader on 4/6/2015 2:00:51 PM |
| I like the sentiments of most of the other writers; they are saying that we need a stronger job market with more better paying jobs. That comes from less interference from the federal bureaucracy. I feel that Mr. Huber has touched on the heart of the problem. The last 8 years, beginning with the 2008 campaign, has been marked by the Demoncrats doing everything they can to polarize the country. They foment hatred between people based on race, religion, politics, and economic class. Mr. Huber used a key word about what the current leadership does not have: vision. God had one of his authors write: "Where there is no vision, the people perish." We should understand that this "vision" is a perception of the way things SHOULD BE under GOD's PLAN, not man's plan. There is only one right way for mankind to come together. That includes accepting many differences, but also knowing that certain differences are not acceptable in the society. And those unacceptable things must be defined by the higher authority, i.e. God, not by any one man from his owned flawed intellect. We got to this place because 9 false gods decided to throw out the US Constitution and impose their own flawed opinions of what should be onto everyone else. That has proven to be a devastating false step for this country. We need to get back to putting God first, and align our politics to Him if we ever want to recover properly. Bob G on 4/6/2015 4:16:29 PM |
| I feel as if my only value to this administration is as a source of tax revenue. Our leadership cuts more slack to terrorists, illegal immigrants, declared enemies and other non-US citizen groups than to average US citizens. Once you've disenfranchised the vast middle, look out. Patricia Flynn on 4/6/2015 4:28:05 PM |
| Political stability in the US. Iran Nuk accord is insanity for anyone who understands Islam. Gov corruption is also unbelievable, the Imperial President can do as he pleases and the Constitution be damned. Moral guidance, patriotic leadership and love of country is absent in the Executive Branch. Lloyd on 4/6/2015 5:00:27 PM |
| Well now. In order for the general public to begin investing their tax returns in the economy instead of savings this country needs to take some serious actions. Firstly, Congress needs to grow some and begin working in a positive manner. No more "parties of no". Both parties are guilty of this, obstructionism seems to be the way to do things in Washington nowadays and though it gives the individual elected representatives a feel good time it does absolutely no good for the country. AND they need to grow some bigger ones and throw away the script they are reading from (written by big business) and start passing legislation that will lead to the creation of good paying jobs. The white house needs desperately to get its act together both in Foreign Policy and the economy. the snubbing of the newly formed AIIB is a dreadful mistake, possibly leading to a currency other than the dollar being the global reserve currency. Only when the US government starts getting it's act together and gives the indication of stability to Main Street will the average joe begin to feel that he can invest a little instead of attempting to hoard cash....... It's FEAR man, fear that things are going to hell in a handbasket...... Do I need to continue????? Jim Hubbard on 4/6/2015 8:57:11 PM |
| Better government and enforcing the law luis on 4/7/2015 1:00:42 AM |
| Funny how the gov says they are running out of money for social security and medicare yet they find money to fly illegal immigrants into our country instead of out..guess its because the gov have been promoting abortion for the last 35 + years and now we have to replace our population base with someone who will pay taxes ...sorry receive tax credits.. bonnie on 4/7/2015 9:17:18 AM |
| CONFIDENCE. With this administration there is no confidence for one to spend money. Whoa, I just woke up and there's another tax. This economy will not take off until we have a leader who is not a socialist mike t on 4/8/2015 8:24:54 AM |
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