Economic Indicators Signal A Change
Signs confirming this are manifesting all
around us. Consider the following economic
numbers from Fear & Greed Trader, one of
this author¡¯s favorite solid sources for cur-
rent economic activity:
** Consumer confidence rose to one of the
highest readings ever recorded at 129.5. The
best print since 2000.
** November Richmond Fed Manufacturing
Index rolls in at 30 versus a consensus of
15. This is the highest level since 1993. The
index was 6 a year ago.
** NFIB¡¯s October report on Small Business
Optimism remained strong with a reading of
103.8 versus the prior month tally of 103.
NFIB Chief Economist Bill Dunkelberg:
¡°Owners became much more positive about
the economic environment last month, which
suggests a longer-run view. In the nearer
term, they are more optimistic about real sales growth and improved
business conditions through the end of the year. The tight labor market
got tighter for small business owners last month, continuing a year long
trend. Fifty nine percent of owners said they tried to hire in October, with
88 percent of them reporting no or few qualified applicants. Hiring activity
was particularly high in Florida and Georgia, as construction firms are still
trying to meet higher demand caused by the recent hurricane.¡±
** New Home Sales rose another 6.2% to 685k in October, much stron-
ger than forecast and a 10-year best, after the 14.2% September jump to
645k (revised from 667k). The month¡¯s supply of homes fell to 4.9 from
5.2 (revised from 5.0).
Inventory remains the issue, and if it does not improve, the impact will be
felt in future sales reports. Lawrence Yun, NAR chief economist:
¡°Existing inventory has decreased every month on an annual basis for 29
consecutive months, and the number of homes for sale at the end of Octo-
ber was the lowest for the month since 1999. Until new home construction
climbs even higher and more investors and homeowners put their home on
the market, sales will continue to severely trail underlying demand.¡±
** Halfway through the fourth quarter, monthly data releases show real
GDP growing at a 3%+ annual rate. If that holds, it would make for three
consecutive quarters of growth at 3% or higher.
Believe it or not, the last time that happened was 2004. The Atlanta Fed¡¯s
Q4 GDPNow estimate now sits at 3.5%. (Continued page 3 >>)
History Suggests Years Of Economic Growth Ahead
Millions of Millenials entering workforce, already effecting data
you ready?... Pg 11
healing... Pg 6
Dig in to sweet
cherry pie... Pg 9
3 nights w/Railroad
Earth... Pg 12
Current leading economic indicators hit
levels not seen in years or even decades
December 1, 2017: Do you know or remember
what happened to the economy when the Baby
Boomer generation entered their main spending
years? Let¡¯s look at the data we have in hand.
In 1982 the Baby Boomers were in the 22-39 age
range and were entering the workforce and be-
ginning their prime earning and spending years.
This led directly to higher demand for everything,
from housing and goods and services to financial
services, thus stimulating economic growth for
the next 18 years. The DOW stock index during
that period went on to gain 1335% in value.
The Millenial Effect
The Millenial generation, as of 2015, are now in
the 18-35 age range and are, similarly to the his-
tory of the Boomer generation in 1982, right now
entering their prime earnings and spending years.
More than one-in-three American workers today
2017 DEC/JAN #8-6
are Millennials (adults ages 18 to 34 in 2015), and that year they sur-
passed Generation X to become the largest share of the American
workforce, according to new Pew Research Center analysis of U.S.
Census Bureau data.
The milestone occurred in the first quarter of 2015, as the 53.5 million-
strong Millennial workforce has risen rapidly. The Millennial labor force
had the previous year surpassed that of the Baby Boom, which has de-
clined as Boomers retire.
Also note, according to the Pew report, with its disproportionately large
share of immigrants, the Millennial generation¡¯s workforce is highly likely
to grow even further in
the near future.
In addition, a significant
chunk of the Millennial
population are 18-24
year-olds. These are the
years when school and
college-going are often
center-stage, and as a
result, labor force parti-
cipation is suppressed.
As the youngest Millen-
nials get older, even more of them will be looking for or getting jobs.
(This chart gives a clear view of the Baby Boomer
effect and appears to be signalling a repeat performance.
Source: Ciovacco Capital)