Pete Wargent blogspot

CEO AllenWargent Property Buyers, & WargentAdvisory (institutional). 6 x finance author.

'Huge fan of your work. Very impressive!' - Scott Pape, The Barefoot Investor, Australia's #1 bestseller.

'Must-read, must-follow, one of the finest analysts in Australia' - Stephen Koukoulas, ex-Senior Economics Adviser to Prime Minister Gillard.

'One of Australia's brightest financial minds, must-follow for accurate & in-depth analysis' - David Scutt, Business Insider.

'I've been investing 40 years yet still learn new concepts from Pete; one of the finest young commentators' - Michael Yardney, Amazon #1 bestseller.

'The most knowledgeable person on Aussie real estate - loads of good data & charts...most comprehensive analyst I follow in Oz' - Jonathan Tepper, Variant Perception, 2 x NYT bestseller.

Saturday, 6 August 2016

Holy moly


The US Bureau of Labor Statistics reported a thumping employment increase of +255,000 for July.

The already massive result in June was revised even higher to +292,000, while there was also an upwards revision for the lower result in April. 

The US economy has now added jobs for a record 70 consecutive months.

The old rule of thumb was that jobs growth of above +75,000 per month should keep unemployment down.

Well, in the last three months the economy has added a total of +571,000 positions!

If you're interested in trends that might be reflected in Australia, how about this? Professional and business services employment increased by 70,000 in July alone to be +550,000 in just 12 months. 

On the other hand mining employment has collapsed by 220,000 or minus 26 per cent since September 2014. 

Despite the mining malaise, nonfarm payrolls continue to recover at a strong pace. 

It had been though that with the economy approaching full employment - not to mention the uncertainty of Brexit - that jobs growth would slow up. 

But no...

Yet the economy has still managed to create +186,000 jobs per month so far in 2016.

The unemployment rate was steady at 4.9 per cent.

As an economy approaches full employment, inflation is eventually expected to take hold. 

Average hourly earnings were up by 9 cents or a strong +0.3 per cent, to be +2.64 per cent higher over the year, which is a solid result in a period of such low inflation of around 1 per cent. 

Amazingly good set of numbers, which will in turn lead to speculation that the US Fed will hike interest rates before the end of 2016.

Wall Street surged to record highs on the news, the S&P 500 up 0.86 per cent to its highest ever close at 2,182.87.