Two years ago CTH began discussing the ramifications to a new emphasis on the economy outlined as a possibility of candidate Donald Trump’s economic policy outlook. Within the overall discussion we walked through the anticipated changes possible if A.) Trump won the election, and B.) Trump began instituting Main Street economic policy ahead of Wall Street policy (the past 20+ years).
We discussed the new dimension that would occur between two economic engines (Main Street -vs- Wall Street) as three decades of federal policy shifted. CTH outlined anticipated economic activity in the space between the two dynamics.
Part of those discussions focused on energy costs (we see them lowering), product costs (we explained how inflation would be weird), and importantly, wage rates. It takes several months of policy emphasis, actual outcomes, before the labor market wage rates would grow. We anticipated seeing that impact in Q1 of Fiscal Year 2018, which is October 1st 2017.
Today the Job Opening and Labor Turnover Survey, “JOLTS report”, begins to show the initial stages of that wage rate increasing trend. The job market has tightened,… considerably. *Note* We are ending fiscal year Q4 (July, Aug, Sept.) and the trend within MAGAnomics is responding according to predictions. For those of us who argued these policy theories for the past two decades, these results are really cool.
WASHINGTON (Reuters) – U.S. job openings jumped to a record high in June, outpacing hiring, the latest indication that companies are having trouble finding qualified workers.
The monthly Job Openings and Labor Turnover Survey, or JOLTS, released by the Labor Department on Tuesday also underscored labor market strength that will likely encourage the Federal Reserve to continue tightening monetary policy despite benign inflation and concerns about consumer spending.
“Companies are running out of workers to hire to do the job or even train to do the work, and this is a ticking time bomb for economic growth,” said Chris Rupkey, chief economist at MUFG in New York. “Today’s JOLTS data bring a September meeting balance sheet unwind announcement a little closer to reality.” (read more)
Another discussion via Bloomberg is here. What’s predictably fun to watch is how leading economists and national economic influence agents continue to be perplexed as we flow through the space between these two economic engines. Deep inside this new dimension, which will last for approximately 24 months, the control agents within the Fed cannot figure out why inflation remains low, yet the economy is heating up.
They really don’t get it.
They don’t get it because they have no reference points.
The economic models of the entire last generation+ are based on the assumptions of continuing globalist economics which advances, and has advanced, the interest of Wall Street over Main Street.
The investing class economy has been the only source of historic reference for approximately three decades. These talking heads convinced themselves that a “service driven economy” was the ONLY economy ever possible for the U.S. in the future.
Back in January 2017 Deutsche Bank began thinking about it and trying to walk out the potential ramifications. They began talking about Trump doubling the U.S. GDP growth rate when all U.S. investment groups couldn’t yet fathom the possibility.
It’s like waking up on Christmas morning every day to see the pontificating Fed struggling to quantify analysis of their surrounding reality based on flawed assumptions. They simply have no understanding of what happens within the new dimension.
Monetary policy, Fed control over the economy, is disconnected and will stay that way for the next 24 months (approx), until Main Street regains full operational strength –and– economic parity is achieved.
As we have continued to share, CTH believes the paycheck-to-paycheck working middle-class are going to see a considerable rise in wages and standard of living.
Forget minimum wage laws, they are inconsequential conversations when measured against the reality of impact in how quickly wages rise in a free, fair, unregulated and growing economy.
Seriously, with full measure of optimism and appreciation – these are exceptional times.