The Bureau of Labor Statistics (BLS) releases the April 2019 jobs report and the results are excellent.  It’s a home run for MAGAnomics as the trifecta continues: Job gains +263,000, Wage growth +3.2%, Inflation low at 1.4%.
With a gain of 263,000 new jobs in April, the overall unemployment rate dropped to 3.6%.  There are more jobs available than people looking for work.  Additionally, the prior two months jobs results were revised upward by 16,000 more than previous reported.

• Total nonfarm payroll employment increased by 263,000 in April, compared with an average monthly gain of 213,000 over the prior 12 months.
• Professional and business services added 76,000 jobs in April. Over the past 12 months, professional and business services has added 535,000 jobs
• In April, construction employment rose by 33,000. Construction has added 256,000 jobs over the past 12 months.
• Employment in health care grew by 27,000 in April and 404,000 over the past 12 months.
• In April, average hourly earnings for all employees on private nonfarm payrolls rose by 6 cents to $27.77. Over the year, average hourly earnings have increased by 3.2 percent.
• BLS Release Link

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The U.S. Steel and Aluminum industry has been a key focus of President Trump in an effort to reestablish a critical industry for America. Part of the administration strategy was broad-based tariffs aimed at curbing China’s dumping of government subsidized product globally. The broad global application of the tariffs defeated the Chinese trans-shipment strategy to avoid them.
Despite opposition from Wall Street republicans and democrats purchased by K-Street lobbyists, the administration policy has been exceptionally successful at driving investment into the U.S. manufacturing base.  The multinationals are furious.

(U.S. Steel) United States Steel Corporation is investing more than $1 billion in the place where our reputation as a trusted industry leader was first forged more than a century ago: our Mon Valley Works near Pittsburgh.
The investment involves the construction of a cutting-edge, sustainable endless casting and rolling facility at Mon Valley’s Edgar Thomson Plant in Braddock, Pa., – the first of its kind in the United States – and a new cogeneration facility with state-of-the-art emissions control technology at the nearby Clairton Plant in Clairton, Pa. (link)

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Well, it looks like the outcome of a horsetrading deal is starting to assemble.  President Trump meeting with Nancy Pelosi, Chuck Schumer et al, to discuss a $2 trillion infrastructure deal.   Despite their schemes and plots this is worth watching:

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Democrats don’t want the baggage of a tax increase heading into 2020… so Schumer punts the financing of the $2 trillion to President Trump; forcing the White House to deal with the dirty part (likelihood a gas tax increase), while Schumer/Pelosi keep clean hands on the high-brow aspect of beautiful infrastructure. That part is politically predictable.
That said, CTH can see the outline a deal where Democrats exchange votes for President Trump’s trade deals (specifically USMCA); to offset the Wall Street Republicans that will vote against the trade agreements; in return for provisions of an infrastructure deal that will benefit Pelosi/Schumer.
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U.S. Secretary of State calls it “Operation Liberty” and supports opposition leader Juan Guaido. The Venezuela regime of Nicolas Maduro calls it a “coup attempt” and has help from Russia and Cuba to put down the uprising.  The regular Venezuelan military, and the ordinary people of the country appear to be caught in the middle.

Perhaps this is the last effort of Venezuelan opposition leader Juan Guaido to shift the balance of power. The White House is supportive but cautious. Everything is tenuous as Venezuela appears to be on the brink of extreme political violence.

CARACAS (Reuters) – Venezuelan opposition leader Juan Guaido on Tuesday made his strongest call yet to the military to help him oust President Nicolas Maduro, and violence broke out at anti-government protests as the country hit a new crisis point after years of political and economic chaos.

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The U.S. economic numbers continue to gain strength.  Ahead of his departure to China for ongoing trade negotiations, Treasury Secretary Steven Mnuchin discusses the current state of the economy with Maria Bartiromo.

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Secretary Mnuchin and USTR Lighthizer arrive in China tomorrow.  This meeting will determine their recommendations to President Trump as to whether a deal can be reached. If no, the potential to re-institute delayed round-two tariffs is possible.
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National Economic Council Chairman Larry Kudlow appears on Fox Business to discuss the latest strong economic numbers including GDP growth, rising wages, low inflation, and strong capital investment.  Additionally, Kudlow discusses current status of U.S. trade negotiations with China and a looming battle against the Decpeticons for USMCA.

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On the latest Op-ed by Iowa Decepticon Senator Chuck Grassley.  As I mentioned last week, the Grassley/Johnson letter to AG Bill Barr is exhibit “A” in how DC attempts to leverage their own financial interests against the outsider that is Donald Trump.
Senate Finance Chairman Grassley’s move last week was a shot across the bow, but generally only noticed by those who travel the deep weeds of corrupt DC leverage strategy.  Essentially, Grassley saying he won’t allow Trump to expose the deep state corruption unless Trump concedes to Wall Street’s demands on trade deals.
It only took a few days for the evidence of this leverage move to surface as Grassley, acting on behalf of his K-Street donors, writes an Op-ed stating if Trump doesn’t drop the Steel and Aluminum tariffs, then he can consider the USMCA “dead”.   An absolutely typical Decepticon move.
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The professional financial punditry can’t explain it.  Flummoxed academics run around bumping into walls amid economic numbers that continue to defy expectations.  All caused by a simple return to common sense ‘America First’ MAGAnomics.
Low unemployment (3.8%); wages growing (+3.2%); inflation stable (1.6%). These measures all have a cumulative impact on paycheck-to-paycheck Americans. Prices for durable goods are stable and wage growth is exceeding inflation. That means more disposable income in the middle-class…DUH. Which, when combined with the increased pay from lower middle-class tax rates, is exactly the intended outcome of MAGAnomics.

Today the BEA is out with consumer spending results for the first quarter that defy expectations.  Consumer spending on goods increases 1.7%. Overall spending +.09 in March, reaches highest gain in ten years. The deplorables are spending their higher wages.  Go figure.  Meanwhile core inflation drops to 1.6%.  The pundits are shocked.

(Reuters Headline) “U.S. consumer spending roars back, but inflation tame” – WASHINGTON (Reuters) – U.S. consumer spending increased by the most in more than 9-1/2 years in March as households stepped up purchases of motor vehicles, but price pressures remained muted, with a key inflation measure posting its smallest annual gain in 14 months.

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President Trump’s campaign manager Brad Parscale joins CBS Margaret Brennan for an interview taped April 9, 2019, which was broadcast today.

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President Donald Trump hosts Japanese Prime Minister Shinzo Abe for a round of golf today, while First Lady Melania Trump hosts Madame Akie Abe in DC.
The relationship between the Trump’s and the Abe’s goes back quite a while and is rooted in a genuine friendship.  The president and prime minister are strong competitors on trade and economic policy; however, the competition is founded on respect.

Prime Minister Abe’s economic policies are rooted in the growth process taught by Edwards Demming.  If you follow their professional business ideology, it is easy to see how President Trump and Prime Minister Abe would face-off around a standard of excellence.
When combined the economies of the United States and Japan account for approximately 30 percent of all global gross domestic product.
This is really old-school business stuff.  Each leader, is essentially an economic policy coach for his country; creating strategies and championing growth in a challenge to see who can succeed the most.  They respect each-other, but this is old school. PM Abe isn’t about to concede to a deal where Japanese growth is ceded; however, he will not cheat to achieve success (unlike Xi).  So friendly adversarial negotiations continue.  Good stuff.
Meanwhile First-Lady Melania Trump and Madame Akie Abe toured some of the historic sites in the capital, including the Washington Monument and US National Arboretum.
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In 2015 CTH outlined candidate Trump’s economic positions and how they would impact the economy.  We anticipated that MAGAnomics would be reversing three decades of federal reserve monetary policy. After about a year of analysis, in 2016 CTH presented a theory: “A new Dimension in Modern Economics“.
The theory was based on a likelihood of what would happen if MAGA economic Policy was shifted to favor Main St over Wall St.  One aspect we presented was how Federal Reserve monetary policy would be oddly disconnected from its ability to influence inflation.
Today National Economic Council Director Larry Kudlow appears on CNBC to discuss the latest first quarter GDP growth rate of 3.2% and the status of the U.S. economy.   Kudlow notes the rate of inflation is disconnected from the GDP growth.

CTH 2016[…]  Understanding the distance between the real Main Street economic engine and the false Wall Street economic engine will help all of us to understand the scope of an upcoming economic lag; which, rather remarkably I would add, is a very interesting dynamic.

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