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. 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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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 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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Japanese Prime Minister Shinzo Abe and Madam Akie Abe will be having dinner tonight with President Donald Trump and First Lady to celebrate Melania’s birthday.  The prime minister and the president are close personal friends and will likely play golf tomorrow.
The Trump-Abe relationship existed for many years prior to becoming U.S. President. Their respect for each-other is genuine.  Abe and Trump are competitors on trade and economics and their strategies within that competition are actually fun to watch. The long-standing friendship underpins a very genuine alliance of U.S-Japanese interests.
In advance of the dinner tonight PM Abe and President Trump meet in the Oval Office ahead of a bilateral delegation meeting to discuss trade and regional matters. They also take questions from the media [Video and Transcript Below]

[Transcript] 4:35 P.M. EDT – PRESIDENT TRUMP: Thank you very much. It’s an honor to have my friend, Prime Minister Abe — Japan. We have many things to discuss, including trade, including some of the numbers that just came out this morning. We had a very big number at 3.2 GDP for the first quarter — usually the worst quarter. That also included the little bit of a dispute we had during the quarter. So 3.2 is far above expectation. I guess many people were thinking it would be in the ones, maybe between one and two. And 3.2 is great.
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President Donald Trump: “The GDP numbers were just announced and they were far higher than even the high expectation. There were many people who thought it would less than 2, and they were at 3.2.”
“Inflation numbers are very low. The gasoline prices are coming down. I called up OPEC. I said, “You got to bring them down. You got to bring them down.” And gasoline is coming down. We’re doing great.”
“GDP is an incredible number. But remember this: Not only that, we have a great growth — which is growth. We have great growth and also very, very low inflation. Our economy is doing great. Number one in the world. We’re number-one economy right now in the world and it’s not even close.  So thank you very much.”
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Director of the National Economic Council, Larry Kudlow, discusses the booming U.S. economy, the future outlook and why he supports the USMCA deal.

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A tale of two contrasting sets of economic priorities. The U.S. economy continues to outpace all economic forecasts.  Recently U.S. retail sales, wage growth and housing starts have exceeded all expectations.  Tomorrows announced U.S. GDP growth is positioned to exceed all previous doomsayer predictions from the professional financial back-bench.
However, the economic results in Canada are going in the opposite direction.  The Bank of Canada cut their GDP forecast from 1.7% to 1.2% today.  A forecast drop of half a percent is a massive drop considering the prior rate of growth was meager at best.

Two full years into the advancement of America-First priorities, the international community is now admitting they can only find growth and value in U.S. investments.

(Via Reuters) […] The [Canadian] central bank now expects economic growth in the first half of 2019 to be lower than anticipated in January, when it released its last monetary policy report, due to a slowdown in Canada’s oil sector, the negative impact of global trade policies and a weaker-than-expected housing sector.

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The U.S. manufacturing economy continues to expand and thrive amid President Trump policies targeted to benefit middle-class workers.  As an outcome of continued growth another report today shows historic growth in income and home ownership for American workers of Hispanic descent.  Additionally, with targeted trade and tariff policy focused on strengthening the U.S. auto sector the ancillary benefits are surfacing.
A strong and vibrant middle-class is the key to a balanced economy, and thanks to America-First policies the U.S. economy continues to expand.  An example of mid-sized expansion is in this latest article from Michigan where 400+ auto-sector jobs are gained.

MICHIGAN – A German auto supplier is expanding its operations in Michigan with a new manufacturing facility in Plymouth Township.

The Michigan Economic Development Corp.’s governing body approved Tuesday a $2.7 million performance-based grant to Webasto Roof Systems Inc., a subsidiary of the Webasto Group, a sunroof, convertible top and heating systems manufacturer.

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