Share the Wealth – February 2, 2018

Registered Investment Adviser Caleb Lawrence

A bruising week for stocks sends the major averages into the final hour with very large losses. Since Monday the Standard and Poors 500 Index has fallen 85 points or 3% while the NASDAQ has dropped 188 points or 2.5%, this despite generally positive economic data today. Bitcoin gets drubbed again as the crypto currency drops below $8,000. I guess the political spying scandal trumps decent economic data.

The January employment report showed 200,000 new jobs created to kickoff 2018. The unemployment rate was unchanged at 4.1%, average weekly hours slipped .2 to 34.3, while average hourly earnings gained .3%. December and November were revised lower by 24,000. For the year wages increased 2.9% slightly ahead of the official inflation figures and overall this isn’t a bad report as 2017 saw some solid, but not great job creation. That said the labor force participation rate finished the year at 62.7% a little lower for 2017 and still far below the pre crisis peak of 66.4% seen at the beginning of 2007 a decline of 3.4%. The employment to population ratio finished 2017 up slightly to 60.1%, but it remains far below its pre-crisis peak of 63.4% at the beginning of 2007 a decline of 3.3%. What these figures speak to is that large numbers of folks, about 95-million, used to work, but no longer do, nor are they counted as unemployed anymore. Yet a series form the very good Blog Calculated Risk shows that 8.6% more people are employed today then were at the pre bust peak, now a lot of this is due to population growth and immigration but you have to wonder just how robust the labor market is given this data.

This is Caleb Lawrence Registered Investment Adviser Scotts Valley Drive and Willis Road in the Scotts Valley Plaza, Suite 202 or call me toll free at 888-RICH PIG / 888-742-4744.

You can catch me on the radio at noon each business day as well on California’s central coast. KPIG 107.5 FM in the Monterey Bay or KPYG 94.9 FM in San Luis Obispo.

Advisory services offered through Caleb Lawrence Registered Investment Adviser Inc.