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Beacon Economics Founding Partner Chris Thornberg on the outlook for the economy.
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-- -- beacon economics he -- the markets.
It's like the economy's thirteen year old daughter OMG -- the ultimate drama queen you know.
-- a little bit of a temper tantrum here with -- in the economy here but what do you mean by that.
Well we have.
-- something -- mind today's numbers were very disappointing but they weren't really wasn't really bad news bad news would be sides of the economy was contracting and where that we're losing jobs.
Instead of what today showed us was that we're we're simply not accelerating we're continuing to sort of stumble through quicksand would not will be afforded very rapid pace.
And really.
While that's disappointing.
That that's not coming to an end it's disappointing that we're not accelerating.
At the same time there's really don't know side at all the US dipping in the sums or news or downturn.
Well Chris what let me let -- Chris let me just challenge you on that because there's -- expression if -- coasting you're going downhill.
-- if we would have a 150000.
New jobs every month we're not keeping up with population growth 69000.
Particularly if you look at the upside down.
Triangle.
In which we have right now -- upside down pyramid.
Showing that job growth from -- February over 200000 going down to 69 -- -- that is a terrible trend is it not.
It's but again the economy is expanding.
-- more adding jobs.
Those sort of ratios used for a lot of notes are not even to keep up with a population growth voted -- that's a long run that's a long -- ratio analysis you're doing here what I'm talking about.
Is right now out immediately we see an economy.
That is still growing not as fast as we want an economy that's adding jobs nowhere near its -- is we want.
But nevertheless economy and still moving forward.
OK let let me don't let me let me give you this the Federal Reserve has left rates.
Very low is -- effectively 00 to a quarter for percentage right fervor for years now that is not stimulating businesses to borrow and grow.
Then you have very low mortgage rates historically low mortgage it.
And actually -- of refinancing David because it's so -- but and that's not stimulating buying because a lot of people aren't getting loans what will pull us out of this morass.
Well that -- argued minus two things Arianna there the big problems in the economy today or are not consumers for rather their exports and when you think about particularly the construction markets the destruction markets are being slowed down because there's still excess inventory out there.
Now we're seeing sides of that starting to change you're seeing sides of the housing markets during the corner but during the quarters laughter from the walking on the street.
Obviously the signs of recovery in housing today is not gonna Toronto -- creating economic growth new jobs until at least the end of the year.
So that part of the equation is still in our future rather -- being right now.
Probably the biggest worry has to do it exports and of course -- ongoing massive trade deficit we continue to run.
This is a big problem and of course a lot of the issues in the economy the slowing of the economy are seeing today is of course largely due to the fact that the dollar's getting pushed up by the problems in Europe.
And some signs of course of -- slowed on demand for products caused by slowed on -- growth you know in the Far East.
Well Chris Chris I agree -- you know point -- I think that most of the stimulus weather's from the Fed or from the federal government is is focused on a consumer and and you know it's the consumers.
Has been acting as part of that's why we see these these good corporate results in terms of what they've been reporting to us but we really need to focus now on production we need.
We need some kind of long term assurance to the producers in our society.
That there costs are production are going to be at a stable level and we don't have those assurances.
Particularly in election you know why I -- today here that this it is as regulatory uncertainty that slowing things -- and -- part of -- also access -- -- -- a small -- you know have a small we have let me him.
I'm a small business person.
OK I hire people and I fire people -- make plans for the future all the time and you know what.
Those sort of long -- issues are not what drives me did make decisions like that and a day to day basis.
I'm looking at a from a -- supply and demand sort of standpoint.
When I have too much work for my guys that I currently have they handle -- that's Gorman gonna hire more people and right now I think most you find most those guys out there in the same boat as I.
At this point in time we have enough folks to deal with the demand we have.
And as such.
That's where the issues -- not hiring a bunch of people Prius -- always a pleasure to have again Chris thank you very much your being your brief beacon economics -- found.
