Strong Economic Fundamentals: U.S. Wage Growth, Incomes, Savings and Spending….

Economic Nationalism -vs- Economic Globalism

Despite the intense doomsayer predictions surrounding the ‘Coronavirus as an economic contagion’ narrative, the U.S. economy remains strong. When evaluating economic impacts for the USA it is important to remember 80 percent of all activity within the U.S. is internal.  We create and consume eighty percent of our own production.

The U.S. economy is unique in the amount of balance within it as compared to other industrial economies.  We are not dependent on exports to sustain our economy; and we are not dependent on any imports at the macro level.  Unlike China, Asia and Europe, and despite decades of efforts by globalists and multinationals, the U.S. generates and sustains a tremendous amount of our own economic prosperity.  First the January data:

The Bureau of Economic Analysis (BEA) reveals data today showing January wage growth .5%, personal income increases .6%, consumer spending at .2%; overall U.S. savings at $1.33 trillion, and low inflation at 1.7 percent year-over-year.  Solid and stable.

Both consumer spending (+.2 Jan) and inflation (1.6% Jan) were impacted by lower energy prices (-.7%) & mild weather in January.  Reuters spins the lower rate of spending growth to imply a contracting U.S. consumer; there is no data to support that narrative.

The Commerce Department said the goods trade deficit contracted 4.6% to $65.5 billion in January. Goods imports tumbled 2.2% last month and exports dropped 1.0%.  This is not necessarily surprising as manufacturing companies have started more long-term supply chain changes in the latter part of last year.

Coronavirus As An Economic Contagion

Obviously economic activity in China is severely impacted by the Coronavirus issues.  The level of their impact is not yet quantified; however, any economic contraction within China can have impacts on downstream economies based on their level of dependency.

As an example the European economy is heavily dependent on China for delivery of products and for Beijing to purchase industrial goods from the EU.

The EU focus on climate change (to the exclusion of their own economic interests) created a scenario where they strongly curtailed manufacturing of some dirty industrial goods (ex. steel) and instead started to purchase more of their needs from China.

As a result of these EU political decisions; and within this EU process; the pollution was shifted away from Europe along with the production.  However, the outcome is their dependency on China increased.  The result: when Beijing sneezes the EU economy catches a cold.

Conversely, the EU is also an export driven economy.  Over the past decade EU leaders gave China preferential treatment due to their ‘dirty product’ import needs.  China is now a big purchaser of EU products… and when China slows purchasing, again the EU feels the impact more severely.

The U.S. economy is more balanced.  As a consumer economy we consume our own production and we have the resources to produce just about everything we need.  The America First policy of President Trump is specifically focused to keep this advantage in place; and actually grow the advantage of our natural economic disposition by returning production of major goods prior administrations watch go overseas.

The impact to the overall U.S. economy, from Coronavirus as an economic contagion, is far less than all other industrial economies.  However, the impact to U.S. multinationals (Wall St) who are dependent on global transactions, trade & manufacturing, is disproportionate.

Under America-First it was always U.S. manufacturers, those who do business inside our nations’ economy, who saw the greatest benefit.  U.S. owned companies doing majority business overseas (ie. Wall Street multinationals) do not gain as much advantage under the America-First programs.  The same is true now with a global economic contagion.

Within a global economic contagion the U.S. companies who rely on the internal American cycle to produce, sell and receive income are safe; our internal economy is strong.  However, the U.S. multinational companies are again at risk…. hence the stock market.

 

This entry was posted in Big Government, Big Stupid Government, China, Economy, energy, European Union, Hong Kong, media bias, President Trump, Trade Deal, Uncategorized, US dept of agriculture, US Treasury, USA. Bookmark the permalink.

52 Responses to Strong Economic Fundamentals: U.S. Wage Growth, Incomes, Savings and Spending….

    • PatriotKate says:

      This is a perfect illustration of President Trump pulling the products back here.

      The manufacturing term for it is Re-shoring — i.e. returning the manufacturing to the U.S., so this photo couldn’t be more perfect. i work in marketing for the manufacturing sector and most of my customers are busier than a one-arm paper hanger. Conversely, I do have some manufacturers who either have operations in China or are dependent on raw materials/components from there and they are beginning to see some supply disruptions.

      Overall though, they are very happy with the economic benefits of America First.

      Liked by 3 people

    • hawkins6 says:

      Larry Kudlow is an incredible and invaluable “asset” for the President’s Administration and for the USA. His level of expertise is very impressive.

      Liked by 1 person

  1. calbear84 says:

    I’ve been buying equities during this “dip” / correction / hoax. The fundamentals of MAGA are sound, and I’m with President Trump and the USA all the way!

    Liked by 7 people

    • Eric says:

      I just made a big stock buy today as well.

      Liked by 2 people

      • IGiveUp says:

        I will be looking for the S&P500 to touch the 200 week moving average (200wma) as a final bottom before resuming the upward bull market in equities we’re still in. That’s when I’ll pounce

        On this chart, you can see that the 200wma (red line) on the $SPX is at approx. 2600 (2632 today, to be exact, but it’s an average so it changes daily):

        http://schrts.co/XgBedzqD

        Liked by 1 person

      • AustinHoldout says:

        I’m planning to buy at 23,500 on the Dow, or a little higher if this selloff looks like it’s slowing down. Oh, for a crystal ball.

        Liked by 1 person

    • The Demon Slick says:

      I would recommend buying now, it’s all going to come roaring back and then some. And fast, like a month or three. Even an unfamiliar investor can bank a 10-30% gain in a short period of time. Full disclosure I took a small and unexpected hit when I failed to expect people to sell off gold holdings to cover margin calls. I and most people thought gold would rise not fall because safe haven. Good luck with your buys!

      Like

  2. uptothere says:

    What’s got everyone spooked are the amount of parts from China that may make up just 5-15% of a finished product. Can range from cars, appliances, manufacturing equip, etc. If you can’t get that internal part outta China, your screwed in the short term. This may drive America to consolidate its supply chain even more. One can hope!

    Liked by 8 people

  3. lgstarr says:

    Rush Limbaugh speaking today about Tim Cook, APPLE’s CEO:

    RUSH: He can’t lie about this, except under penalty of punishment that would include prison and massive fines, personally and for the company. These guys, these CEOs and the chief financial officers, they can’t lie. You know what happens to them if they do. You’ve heard of insider trading and all that other stuff. . .

    Bottom line, he’s not panicked because they’ve been through so many things like this, they have alternatives. They have emergency plans. They have alternative sources. . .

    He’s not worried, folks, and the bulk of their assembly is in China and he can’t lie about it. So that is the answer to “do you think the supply chain is the problem with the stock?” It could be because I’ll guarantee you over half the stock market analysts telling their clients whether or not to buy Apple do not know 10% of what I just told you about the company. It’s outrageous how ignorant some of them are. . .

    BINGO!

    Liked by 2 people

    • GB Bari says:

      Yep. Rush was all over this media-hyperbolized crisis again today. He zeroes in on the root cause of the problem (DemonRATs’ opportunistic politicization of the virus) like a laser beam.

      Liked by 1 person

    • rashomon says:

      PDJT apparently opened a door for Cook to work with India. Frankly, I don’t trust the U.S. financiers who are setting up India. As in RRK’s global wing staffed by David Petraeus, H.R. McMaster and Richard Holbrooke.

      “In his piece in the Forbes, author George Anders explains why KKR needs the CIA. Everyone’s buzzing about KKR & Co.’s decision to bring former CIA director David Petraeus into the private-equity firm as chairman of the newly created KKR Global Institute. Could Petraeus use his network of connections to help KKR close more deals? Perhaps. But there’s a deeper motive for this alliance that looks far more compelling.

      The former CEOs of Caterpillar, Vodaphone, Motorola, First Data and nearly two dozen other major global companies now serve part-time as KKR senior advisers. KKR says these worthies provide operational and strategic insights, while sometimes advising on individual deals….
      …Gen Petraus is also credited to have trained former United States National Security Advisor Herbert Raymond McMaster who is responsible for pulling India into the Anglo-American orbit as a “major defense partner” implemented through ‘Washington’s Man in New Delhi’.

      Gen Petraeus is also the key player in the ongoing plot for an Anglo-American Airbase in Kashmir under the trusteeship of the United Nations – a policy drafted by Mountbatten himself. When asked about US intervention in Kashmir, then US Central Command Chief Gen Petraeus disclosed in a Senate Armed Services Committee hearing on Kashmir: ‘Together with my great diplomatic wingman Ambassador Richard Holbrooke, this effort actually has started’.

      As per intel with GreatGameIndia, Petraeus is the pointman for Deep State in India. In 2018, Foreign Secretary S Jaishankar and former CIA Director David Petraeus together formed strategies for the ‘dramatic transition of India in the New World Order” at a six-day Raisina Dialogue also attended by Israeli Prime Minister Benjamin Netanyahu.'”

      The key speaker for this UK-India Summit 2019 was Petraeus. I don’t trust the U.K and I certainly don’t trust “Betray-us” given his history. especially when I read about the involvement of McKinsey & Company, which has been coddling the Deep State’s global corporations since it started playing footsie with the CIA DECADES AGO and constructing policy for nations of questionable character…just for one: China and its artificial islands in the South China Sea. It’s not as if these former U.S. players didn’t know what they were/are getting into.

      Democrats are not PDJT’s only enemies; Rockefeller Republicans are equally dangerous.

      https://greatgameindia.com/cafe-coffee-day-kkr-cia/

      Like

  4. Don McAro says:

    This is what our President is up against….
    CNN 38% of Americans would not by Corona beer “under any circumstances” because of the Coronavirus according to a recent survey…

    I said to my self who is that dumb??…Then realized CNN probably polled its own viewers..

    Liked by 3 people

  5. Dave the WV Deplorable says:

    My thoughts exactly. This virus scare will hopefully move the supply chain out of Asia and back to USMCA. Another win for us and great loss for the Globalists!!

    Liked by 1 person

    • GB Bari says:

      Maybe down the road a few more companies will step back and see the larger problem they face by remaining in China. But in the short term I don’t see too many of them changing.

      Yet they’ve had TWO years to get out, especially after USTR Robert Lighthizer’s Section 301 report (March 2018) on China’s very problematic trade practices. But too many manufacturers and others in various supply chains haven’t yet moved off the dime.

      Liked by 1 person

  6. classic………………”CNN probably polled its own viewers……”

    Like

  7. thedoc00 says:

    This is exactly the reason that the President’s economic folks need to go on TV to provide a more simplified and easily understood briefing on the difference between Wall Street and Main Street economies. The brief needs to be honest, not dismiss Wall Street and be upfront that the President needs to balance things to account for the role Wall Street plays in the economy.

    The Media have convinced the average Joe (voter) that Wall Street IS THE ECONOMY, beyond all reason. Even the clowns like Krugman play this mantra and its the reason the Market Performance is shown in giant red text on bad days. Its a major optics issue. Plus, many (voters) have their future retirement money in the “Market” and do do not have the expertise nor time to properly manage it in a dispassionate manner.

    I was lucky, my employer had our savings with Fidelity and fidelity gave free financial planning support to the employees. I had a great advisor assigned and learned allot. Plus, I actively participate in their training and forums. You can dis Fidelity or any of the similar financial companies all you want, but for folks like me they have done tremendous service in helping me grow my savings as well as hedge for times like today to greatly minimize losses, even as I spend my savings in retirement. Plus, my professional life had me heavily involved with allot of proposal writing, financial modeling, production planning and import/export activities.

    Liked by 2 people

  8. jrapdx says:

    Despite all the uproar in the media over the coronavirus outbreaks, and hysteria of Democrats and allies shouting how the “pandemic” will devastate the US, the situation is hardly that catastrophic. It’s evident the President’s measures will keep the virus effects to a minimum, and panic will subside in due course.

    The most significant effect is going to be strengthening US independence from foreign (that is, Chinese) influence over crucial industries, in this case, pharmaceutical manufacturing. In particular, the production of basic raw materials, the substrates used to make finished drugs, have been predominantly made in China. That’s the part that needs to change.

    FWIW producing the raw ingredients isn’t a high-margin operation, which is a reason it’s been relegated to China where production costs are low. Other countries probably are interested in developing or augmenting such production capability. Whether it would be attractive to American manufacturers remains to be seen.

    President Trump is no doubt well-versed in the issues surrounding drug manufacturing and ultimately retail medication prices consumers have to pay. If the reliance on Chinese production of necessary raw ingredients is resolved, the rest of the solution naturally flows from it.

    Liked by 1 person

  9. James Groome says:

    We are basically break even or maybe +5% with ZERO exports…
    Then THINK ABOUT the amount of our EXPORTS directly financed by the US through the Im/Ex BANK and the COMMERCE DEPT? OR DIRECTLY and FULLY FUNDED through Congressional appropriations INTL funding etc. etc dare I speculate that less than 5% of export business is TRULY INDEPENDENT FROM GOVERNMENT?

    I did a decent amount of export business – wholesale pulp and paper and have been approached by the commerce dept, as well as other government developmental agencies throughout the 20 years I was trading internationally.

    Like

  10. oldersoul says:

    Very good, Sundance. This is the correct palliative. Keep hammering it home, as you have done to open every column this week on the topic.

    This is a politically-weaponized and orchestrated crisis, targeting ECONOMIC HEALTH.

    The carrier is conspiratorial media hysteria.

    Except they are sickening the wrong patient: Wall Street (themselves, aka globalists and multinationals).

    Main Street remains as healthy as an ox.

    Liked by 2 people

    • GB Bari says:

      May be too fine a point, but IMO the media hysteria is not the cause for the Wall Street panic, the hyperbole is simply the media-amplified screams of protest from the globalists who stubbornly remain in China despite being repeatedly forewarned and asked to re-patriate to the U.S. by the Trump Administration.

      Liked by 1 person

  11. loubanya says:

    This is a timely post as I was wondering how this was impacting the Main Street economy. Thanks for the breakdown for a deplorable blue collar like me. The media seizing on the coronavirus so much, something I’d been reading about for over a month, made me suspicious. Sad that my impulse is to immediately question what they say and why they say it. But they brought it on themselves.

    If anyone has suggested reading on economics, stocks, etc I’m all ears. Just reread The Ascent of Money and enjoyed it.

    Like

  12. Paul Vincent Zecchino says:

    Best thing people could do right now is shut off the TV media’s yammering doomsday clowns.

    SW FL, you wouldn’t know anything is amiss. Parking lots are filled at every business, moreso even than last year. Restaurants, including Chinese restaurants, are packed.

    Recently visited FL East Coast. Our favorite Chinese restaurant in Jupiter, http://www.goldenpavilliontogo.com, was packed on a Friday night. No one was dropping like flies from Corona, bird flu, SARS, swine flu, ebola or any the other pandemics that were supposed to kill billions.

    Good point, this is affecting the greedy-guts on Wall Street who shortsightedly bet on chicoms, instead of the American people.

    This temporary downturn is the best thing to drive home the point, it’s time to become self-sufficient and bring manufacturing home.

    “Global interdependence” was one of the rockefelons’ crackpot ideas, borne of their generations fear of another war which might involve nuclear weapons. Their idea was is everyone needed everyone else, we’d all get along.

    This is BS. The chicoms remain hostile, sworn enemy of the west and America. No good comes from ‘free trade’ with hostiles. Nixon had to do the rockefelons’ bidding, as he was their man in DC. He opened trade with China in ’72 with hack Kissinger’s ‘ping pong diplomacy.’

    The Clintons ramped this up, for their usual self-serving reasons.

    Now the cows are coming home. Good for President Trump for his successful meeting with India’s PM Modi, not coincidentally immediately subsequent to his addressing Congress about the virus.

    Who needs chicoms when India is a friendly nation comprised of smart people?

    Wall Street and its media/demshevik cronies can either smarten up or take the consequences.

    Rush is right, again. Most of these stock market doomsayers don’t know what they’re talking about.

    Liked by 4 people

  13. donna kovacevic says:

    I was speaking with a friend today, she lives in Frankfurt, Germany. She told me she was out shopping most of the day, stocking up on food etc. A huge panic there over the Corona Virus, said people in grocery stores had 2-4 carts all full of different items, she said so many people out and about shopping it felt like Christmas.

    Like

  14. Raptors2020 says:

    Americans: be aware of what’s happening in Canada. Trudeau is diligently destroying the oil industry in all its aspects. A company called Teck Industry has just announced they are shutting down their oil sands project. Seven thousand people are out of work.

    Bernie Sanders has promised to outlaw fracking. Hundreds of thousands of jobs are directly dependent on fracking. The economic boom of Donald Trump is very much the result of the lower oil prices that have come from the innovation of fracking.

    Bernie Sanders is a fanatic leftist. Poor people become dependent on government. To a communist like Bernie, that is a good thing.
    Justin Trudeau is a fanatic about global warming. By destroying Canada’s oil industry, he is convinced he is saving the world.
    These evil men end at the same place. They are nihilists. Human suffering is a good thing. That is leftism.

    The late George Jonas predicted that environmentalism and climate change fanaticism would be to the 21st Century, what Fascism and Communism were to the 20th Century.

    The century is young. Mussolini, and even Hitler, were seen as positive figures during the 1930s. Mussolini was a role model for many in FDR’s government. Don’t let a lack of imagination blind you to the ascendant evil that is all around us.

    Liked by 5 people

    • Paul Vincent Zecchino says:

      Excellent. Thank you for stating the truth.

      What seems appealing, even paradisiac, in short order can prove to be horrific.

      Liked by 2 people

      • Raptors2020 says:

        Paul:
        People in the future, will look at us, and say “how could you let this happen?”, the way we look back at the Holocaust now.

        The fanatics of today, like Ocasio-Cortez, are just so intimidating. Like Yeat’s poem, the best lack all conviction, while the worst are full of passionate intensity. That’s an eternal truth.

        One huge tell: they have no intention of living by the rules they set out for others.

        Their grand intentions are supposed to excuse their hypocrisy. Uh, no..

        Like

  15. Alan Reasin says:

    Watched TV all today looking for this info: If this vaccine works on corona per the below link, it would be pure luck, since they just happened to have picked this virus some years ago ago to use in their research. Yet not one program I watched mentioned this good news that we may have a vaccine in 90+ days. This virus causing panic is ridiculous. Stupid Americans buy out the supply of masks that are just about useless, won’t buy Corona Beer and are generally panicking. Yet 26,000 or greater deaths from the seasonal flue and 33,00 deaths from yearly car accidents don’t distress our citizens; however 61 cases in the US and no deaths from the Corona Virus scares the living hell out of our snowflake citizens. I understand the stock market drop though. Russia has had 2 recovered victims; maybe secured borders does work https://coronaoutbreakmap.com/coronavirus-world-outbreak-map/
    https://www.dailywire.com/news/bds-this-israel-makes-exciting-breakthrough-in-race-for-coronavirus-vaccine?fbclid=IwAR1n8Y0DnCMhB6-KR9CdlWIuE-SKHVC4TyiG3sJdm2R8SGv6MDn8Bq1yCQg

    Like

  16. bluecat57 says:

    Kinda hard worrying about your LONG term stock investments crashing when you are getting RAISES at your BETTER job.

    Liked by 2 people

  17. L4grasshopper says:

    But OF COURSE the WSJ Editorial Board tonite advised Trump to help the caronavirus hit economy thusly:

    “Which brings us to the possible economic policy responses. Mr. Trump could help by immediately lifting his unilateral tariffs, which would amount to a tax cut on trade and consumers.”

    WSJ has been attacking the tariffs for over 2 years. Despite price inflation being under 1.4% annually, they keep shouting about how the tariffs are killing consumers 😱

    Was actually surprised they didn’t plead for an aid package to Communist China to help them out 🙀

    Like

  18. Patchman2076 says:

    “But, but, but… Your riding the coat-tails of the Obama economy” *sarcasm

    Like

  19. Sharon says:

    My opinion: context matters. The Dow Jones would have to lose several thousand points before it would show a net loss since POTUS took office.

    I haven’t heard that mentioned yet. Maybe I missed it.

    Here’s the DJ average for the last ten years:

    https://www.macrotrends.net/1358/dow-jones-industrial-average-last-10-years

    Liked by 1 person

    • LafnH20 says:

      Sharon, I said the same thing to a friend today after they mentioned the DOW drop.

      Folks are complaining about a 10% drop, yet they forget the 40-50-60 % gains.

      I mentioned the “Two trains leaving South Florida” analogy (explaining the Wall Street vs Main Street dynamic), Sundance has posted several times, and they had an “Oh, I get it.” Moment!!

      🤗

      Like

  20. John says:

    Sundance what is your take on claims Ive seen that the Fed is again manipulating repurchase orders to weaken the market (as some claim they did in 2008), in addition to short sellers purposefully driving the market down, while the Dem tyrants politically weaponize Coronavirus in order to tank the economy and therefore PDJTs greatest (most identifyable)) claim of success?

    I have a feeling that by Easter this Coronavirus will be a thing of the past where thinking people laugh at the Dems screeching over what turns out to be nothing more than the flu, and the Market rebound then, will dwarf this slight downturn.

    Im not wrong to be greedy right now and work to expand my portfolio, am I? I see opportunity and am looking for stocks of companies who have already, or are on the way to, disentangling themselves from China.

    Im liking the prospects of producers of medical supplies with the ‘Made in USA’ tag. Im really looking for that one smallish company that is positioned to take advantage of the outrage I am seeing everywhere, from pundits to the people I come in contact with, over our meds and med supplies being produced in China.

    Like

    • Ninja7 says:

      It is a Truism, (if you have the cash) buy on the dips, sell on the peaks.)
      As all Treepers know, as Sundance has so eloquently stated “Invest in Main Street Companies ” JMHO Best of Luck 🤗🤗

      Like

  21. WRB says:

    The Bureau of Economic Analysis (BEA) reveals data today showing January wage growth .05%, personal income increases .06%, consumer spending at .02%;

    Not that anybody cares, but Sundance should fix these numbers, as they should be 0.5%, 0.6% and 0.2%. They are the monthly change in January, and if they held over 12 months, represent 6%, 7.2% and 2.4% per annum respectively

    Liked by 2 people

  22. Tiffthis says:

    And just like that, Obama stopped taking credit for the stock market 🤦🏼‍♀️

    Liked by 2 people

  23. Kerry says:

    I live 45 miles from Des Moines, IA. (Did I have to add the Iowa part?) I’m also a big hockey fan and Des Moines has an AHA team, the Iowa Wild. Today on the radio I heard an interview with the Wild equipment manager. He said the Wild and all other AHA teams are facing equipment shortages including uniforms and hockey sticks because they’re all are sourced from China. He’s told the players not to deliberately destroy sticks out of frustration or to show anger at a call as the inventoryis running low. So yes, the coronavirus impact is “worse than we thought.” 🙂

    Thank the good Lord we still brew most of our beer.

    Like

  24. Pokey says:

    I may just go buy a six pack of Corona for my office display shelf. It will be a great exhibit in the can’t fix stupid section.

    As usual for the Democraps, it is all politics all the time. You have to admit that they are more determined than a dog with a bone, so we are forced to try to take away the bone pile before they find more. 🙂

    Like

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