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By Rupert Jones, The Guardian, 4/1/2025
MarketMinder’s View: A range of different costs are set to rise this month, adding more pressure on British households already strained by elevated living costs. We feel for those affected, but some scale and perspective are in order here before fearing this is a sign of UK inflation resurging to hot rates: One, many of the factors in here are adjusted to reflect past inflation pressures, with a major example being the energy price cap, which has long made energy less responsive to declining prices than it would be otherwise. The government’s confused web of energy price interference is counterproductive in this regard. Some other taxes in here also are designed to factor inflation over the past year in, almost like a hangover of past price changes. So while these taxes and costs may bump up a bit in April, this isn’t akin to the inflation in 2022, which saw prices economywide gallop higher by double-digit rates at the peak. We are way beyond that now. And the causes here matter a lot, too, given this is about annual resets to tax or price policy. Inflation is about monetary policy—too much money chasing too few goods and services—and it sobered up long ago. The focus on these factors is a sign of investors fighting the last war on inflation, a further illustration of too-dour sentiment in Europe.
Job Opportunities Are Shrinking and Layoffs in the Federal Government Just Hit Their Highest Level in Four Years
By Alicia Wallace, CNN, 4/1/2025
MarketMinder’s View: To date, in all the discussion surrounding the Trump administration’s high-profile “efficiency” push involving job cuts to the federal workforce, the actual scale and scope of such reductions has been lacking. Now data are emerging to help put scale to this. And, despite the fearful headline here, the reality seems a lot more benign. “Unsurprisingly, the sector seeing one of the largest increases in layoffs was the federal government, which saw layoffs spike to 22,000 from 4,000 in January, marking the highest monthly total since November 2020.” Yet, “Despite the drop in openings, overall labor market turnover held fairly steady in February, as the percentage of hires, layoffs and quits of total employment were unchanged. The level of layoffs did pick up from January to an estimated 1.79 million from 1.67 million, according to the report.” The ratio of openings to unemployed persons was 1.1 in February … again. It has hovered around that mark in every month since October, per data from the St. Louis Fed. So despite the jump in federal layoffs, it doesn’t appear as though much changed in February. Of course, as this article goes on to bemoan, federal layoffs aren’t done and could grow in March and beyond. We can’t know how much yet. But with all the fear and loathing spent addressing this, there seems to be ample room for relief and positive surprise should the labor market hold up better than feared.
Are Consumer Sentiment Studies a Good Measure of the Economy?
By Phillip Molnar, San Diego Union-Tribune, 4/1/2025
MarketMinder’s View: This piece rounds up a number of economists’ and businesspeople’s views of consumer sentiment surveys like the University of Michigan’s, which plunged in March and spurred vast fear of recession ahead. The views here are varied on the matter of how telling or important these gauges are—some sensible and some less so. On the titular question, you can pretty squarely put us in the “No” camp. Sentiment surveys like this are very often a coincident indicator influenced heavily by recent, short-term stock market moves. And by political bias. The latter is a point that isn’t raised by many here, but a look at the University of Michigan’s Partisan Preference table is illuminating. While sentiment has cooled everywhere, the gap between Democratic respondents’ economic expectations and Republicans’ hit 70 points in March. Democratic sentiment was 27.9—a record gap and the lowest read in the partisan preference gauge’s short, 9-year history. Democratic expectations are down nearly 70 points since October 2024, the last pre-vote read, which far outpaces declines in Independents or Republicans over that span. Similar 2017 and 2021 swings didn’t reflect huge economic changes. They showed partisanship. That politicization is another reason such gauges aren’t super telling about future economic activity. For more, see our March 31 cover story, “On Volatility and Consumer Confidence.”
By Rupert Jones, The Guardian, 4/1/2025
MarketMinder’s View: A range of different costs are set to rise this month, adding more pressure on British households already strained by elevated living costs. We feel for those affected, but some scale and perspective are in order here before fearing this is a sign of UK inflation resurging to hot rates: One, many of the factors in here are adjusted to reflect past inflation pressures, with a major example being the energy price cap, which has long made energy less responsive to declining prices than it would be otherwise. The government’s confused web of energy price interference is counterproductive in this regard. Some other taxes in here also are designed to factor inflation over the past year in, almost like a hangover of past price changes. So while these taxes and costs may bump up a bit in April, this isn’t akin to the inflation in 2022, which saw prices economywide gallop higher by double-digit rates at the peak. We are way beyond that now. And the causes here matter a lot, too, given this is about annual resets to tax or price policy. Inflation is about monetary policy—too much money chasing too few goods and services—and it sobered up long ago. The focus on these factors is a sign of investors fighting the last war on inflation, a further illustration of too-dour sentiment in Europe.
Job Opportunities Are Shrinking and Layoffs in the Federal Government Just Hit Their Highest Level in Four Years
By Alicia Wallace, CNN, 4/1/2025
MarketMinder’s View: To date, in all the discussion surrounding the Trump administration’s high-profile “efficiency” push involving job cuts to the federal workforce, the actual scale and scope of such reductions has been lacking. Now data are emerging to help put scale to this. And, despite the fearful headline here, the reality seems a lot more benign. “Unsurprisingly, the sector seeing one of the largest increases in layoffs was the federal government, which saw layoffs spike to 22,000 from 4,000 in January, marking the highest monthly total since November 2020.” Yet, “Despite the drop in openings, overall labor market turnover held fairly steady in February, as the percentage of hires, layoffs and quits of total employment were unchanged. The level of layoffs did pick up from January to an estimated 1.79 million from 1.67 million, according to the report.” The ratio of openings to unemployed persons was 1.1 in February … again. It has hovered around that mark in every month since October, per data from the St. Louis Fed. So despite the jump in federal layoffs, it doesn’t appear as though much changed in February. Of course, as this article goes on to bemoan, federal layoffs aren’t done and could grow in March and beyond. We can’t know how much yet. But with all the fear and loathing spent addressing this, there seems to be ample room for relief and positive surprise should the labor market hold up better than feared.
Are Consumer Sentiment Studies a Good Measure of the Economy?
By Phillip Molnar, San Diego Union-Tribune, 4/1/2025
MarketMinder’s View: This piece rounds up a number of economists’ and businesspeople’s views of consumer sentiment surveys like the University of Michigan’s, which plunged in March and spurred vast fear of recession ahead. The views here are varied on the matter of how telling or important these gauges are—some sensible and some less so. On the titular question, you can pretty squarely put us in the “No” camp. Sentiment surveys like this are very often a coincident indicator influenced heavily by recent, short-term stock market moves. And by political bias. The latter is a point that isn’t raised by many here, but a look at the University of Michigan’s Partisan Preference table is illuminating. While sentiment has cooled everywhere, the gap between Democratic respondents’ economic expectations and Republicans’ hit 70 points in March. Democratic sentiment was 27.9—a record gap and the lowest read in the partisan preference gauge’s short, 9-year history. Democratic expectations are down nearly 70 points since October 2024, the last pre-vote read, which far outpaces declines in Independents or Republicans over that span. Similar 2017 and 2021 swings didn’t reflect huge economic changes. They showed partisanship. That politicization is another reason such gauges aren’t super telling about future economic activity. For more, see our March 31 cover story, “On Volatility and Consumer Confidence.”