Bill Cheney
Bill Cheney
add bit clearly continue feels job jobs market million move tight year
There is still a big backlog to be made up before it feels like a tight job market. Clearly it's a tighter job market than it was a year ago, and if we continue to add a million jobs a quarter, we'll move in that direction. But I think it will take a little bit of time.
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There is a certain appeal to going to a nice round number like 5 percent. But if we get some bad inflation numbers, then they won't stop at 5 percent.
circumstance dime fed instrument monetary perfect policy pull pushing soon spending starts turn
Monetary policy is the perfect instrument for these circumstances. The Fed can keep pushing as needed, but still can turn on a dime and pull back as soon as spending starts to rebound.
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Now we're starting to see that wash out, and we're seeing that the labor market really has been gradually strengthening for most of the first half of this year. And this is fundamentally good news for consumers and for the health of the recovery going forward.
employment next piece report
Next week's employment report will be a much more important piece of new information.
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Many businesses see statistics showing economic growth as a cruel joke. Competition is still brutal, wages are still rising, prices are still flat or falling, and profits are as hard to find as they were a year ago.
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It would be kind of like when they put through a substantial emergency rate cut when the market crashed in 1987. I don't think it is evidence of panic to treat what happened yesterday as an emergency. It's an emergency on many levels.
bit lighter perhaps
Perhaps Santa's sleigh was a bit lighter than we thought.
elf full operating workshop
Santa's workshop will be operating pretty much at full capacity. There just probably won't be much elf overtime.
net
Corporations may be ultra-cautious, but at least they're not slashing jobs, and that's a net positive.
road worst
The worst is over. We're on the road to recovery.
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The rise in wages of 6 cents might cause jitters, but wage inflation is less of a worry now, especially with productivity still growing at a healthy clip. As the economy slows, the unemployment rate will continue to inch up and wage pressures should ease further.
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Sooner or later rates will have to come back up to at least a 'neutral' level. But for now they've got the monetary policy lever just about where they want it, and it makes sense to do as little as possible for as long as possible.
dangerous encourage growth job people room sitting wage worry
A lot of people must still be sitting on the sidelines. This kind of job growth will encourage them, but I don't see it sparking a surge in wage costs. We still have a lot more room for job growth before we have to worry about venturing into dangerous inflationary territory.