Under Employed

More people found new jobs last month than were expected.  However, the average hourly earnings dropped and the average hours worked also dropped, meaning that more and more Americans continue to be underemployed.  And it turns out that Under Employed is a show on MTV and they all look befittingly unhappy.  (I have never seen the show so don’t judge me.)  The White House is continuing to call the labor market “robust” because the Unemployment Rate is still at 4.9%.  Though I track statistics every day, I have learned that they are not all completely accurate.  For example, when I lived in Nicaragua, the published unemployment rate was 95%. Everybody still went to work every day, they were just paid under the table so they weren’t included in the government statistics.

Interest rates are starting to trend upward.

Fed Day

In a couple of hours when I
am eating more than my recommended caloric intake for the day, the Federal
Reserve will release it’s monthly (+/-) monetary statement.  Economists
across the country anticipate that the Fed will continue to taper
its Bond buying activities by another $10B to $55B per month, as well as
to rescind on the previously affirmed 6.5%-Unemployment-Rate-as-a-threshold-to-begin-to-raise-the-interest-rates
that they directly control.  The reason for the latter is because the
Unemployment Rate is no longer considered a true measure of
the labor participation rate in the US–hence the growing
interest in the Labor Participation Rate study.

I expect the Fed to keep their Cost of Funds rate at 0.25%.  If they
do NOT taper to $55B/mo, rates will come down…but don’t hold
your breath.