Monday, May 7, 2012

It's The Economy Stupid: Implication of Friday's Employment Report

From Bridgewater:


“Friday’s employment report suggests that the pace of improvement in labor markets from depressed levels has slowed considerably over the last couple of months.  The pace of slowing may be somewhat overstated, as we may now be seeing the negative flip side of the boost to employment from the earlier weather-related distortions, but at least some slowing in labor markets is consistent with the moderation in US growth since March. Despite April’s weakness, employment growth rates of around 1% a year are still about 0.5% faster than growth in the working-age population, so they should over time reduce the slack in labor markets. As a comparison, this pace of improvement is roughly in line with the recovery in labor markets during the last expansion from 2004-2007. Of course, given the much higher level of unemployment, this pace of improvement would still mean that it would take many years for labor markets to normalize.”


Why quote Bridgewater?  Well, call me crazy, but sometimes it might be better to listen to someone who makes money by being right (Bridgewater) than listening to someone who gets paid a salary to be mostly wrong (your average garden variety economist).



John Broussard

Assistant State Treasurer

Chief Investment Officer

State of Louisiana

Department of the Treasury

Ph:  225-342-0013

Fx:  225-342-9721


Street Address:

445 North Blvd, 7th Floor

Baton Rouge, LA 70802

Mailing Address:

P.O. Box 44154 Capitol Station

Baton Rouge, LA 70804-4154

Physical Location:

One City Plaza, 7th Floor

Corner of North Blvd & 4th Street

Exit 1B I-110 Convention Street,

Turn Left to get to North Blvd,

Turn Right on North Blvd


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