Fed is Likely to Lower Interest Rates

The Bureau of Labor Statistics (BLS) has again handed President Donald Trump a bleak set of jobs numbers, just one month after he fired the agency’s commissioner over weak employment data.

On Friday morning, the BLS reported that nonfarm payroll employment rose by only 22,000 in August. Analysts had forecast that the economy would add 75,000 jobs during the month. According to the agency, gains made in health care were offset by losses in federal government employment, as well as mining, quarrying and oil and gas extraction.

While July’s figures were revised up to 79,000 from 73,000, June’s numbers were revised down by 27,000, dropping from 14,000 to minus-13,000. Meanwhile, the unemployment rate edged up to 4.3 percent from 4.2 percent.

Lowering interest rates to stimulate the economy is known as expansionary monetary policy. This policy aims to reduce borrowing costs, encouraging households and businesses to increase spending and investment, which helps boost economic activity.

Given that the employment rose by only 22,000 in August it is likely that the Fed will lower the interest rate as Donald Trump has been pushing.

Today in History: August 14, FDR signs Social Security Act

On Aug. 14, 1935, President Franklin D. Roosevelt signed the Social Security Act into law, ensuring income for elderly Americans and creating a federal unemployment insurance program. 

National Institute on Retirement Security released a January 13, 2020 report saying that 40% of Older Americans Rely Solely on Social Security for Retirement Income.

Included in their findings:

Only a small percentage of older Americans, 6.8 percent, receive income from Social Security, a defined benefit pension, and a defined contribution plan.
A plurality of older Americans, 40.2 percent, only receive income from Social Security in retirement.

The U.S. Economy Shrank

NOT MAKING AMERICA GREAT

The U.S. economy shrank at a 0.3% annual pace from January through March, the first drop in three years, as President Donald Trump’s trade wars disrupted business. First-quarter growth was slowed by a surge in imports as companies in the United States tried to bring in foreign goods before Trump imposed massive tariffs.

The January-March drop in gross domestic product — the nation’s output of goods and services — reversed a 2.4% gain in the last three months of 2024. Imports grew at a 41% pace, fastest since 2020, and shaved 5 percentage points off first-quarter growth. Consumer spending also slowed sharply — to 1.8% growth from 4% in October-December last year. Federal government spending plunged 5.1% in the first quarter.

Forecasters surveyed by the data firm FactSet had, on average, expected the economy to eke out 0.8% growth in the first quarter, but many expected GDP to fall.

Financial markets sank on the report. The Dow Jones tumbled 400 points at the opening bell shortly after the GDP numbers were released. The S&P 500 dropped 1.5% and the Nasdaq composite fell 2%.

The surge in imports — fastest since 1972 outside COVID-19 economic disruptions — is likely to reverse in the second quarter, removing a weight on GDP. For that reason, Paul Ashworth of Capital Economics forecasts that April-June growth will rebound to a 2% gain.

How is your IRA and other savings accounts?

US stocks opened on a grim note in New York, with the Morningstar US Market Index down as much as 3.6% in early trading. Stocks were briefly more than 2% in the green, seemingly on rumors of a pause in the implementation of tariffs, but they quickly fell lower again.

The Nasdaq 100 was 1.8% lower in midmorning trading, while the S&P 500 was down 2.0%. The “Magnificent Seven” stocks continued their declines from the previous week, with Nvidia NVDA down 1.9%, Tesla TSLA down 6%, and Apple AAPL down 4.5%.

Since the imposition of Trump Tariffs.

As of 10:19 AM Pacific Coast Time

DJIA

37,447.63-5,096.59 (-11.98%)

S&P 500 Index

4,973.86-907.77 (-15.43%)

Nasdaq 100 Index

17,165.05-3,847.12 (-18.31%)

Markets plunge with S&P 500 down 6% and Dow down 2,200 after China retaliates against Trump tariffs

Mike Pistillo Jr., center, works with other traders on the floor at the New York Stock Exchange in New York, April 3, 2025. (AP Photo/Seth Wenig)

CNN‘s black sheep and resident MAGA supporter, Scott Jennings, had a hilarious reaction to President Trump’s recent tariffs that sunk the stock market.

Jennings, a frequent conservative contributor on the network, joined anchor John Berman on Friday’s broadcast of CNN News Central with Meghan Hays, a Democratic strategist, to sound off on the impact of Trump’s tariffs.

At the end of the segment, the stock market ticker was displayed on the screen near Jennings, who hid under the table in an effort to escape it.

Berman jokingly apologized to Jennings for having the stock market ticker in front of him on screen.

‘Why didn’t you put it by Meghan? Can we just shove it to the other side of the screen? I don’t understand. I feel like you did this on purpose,’ Jennings joked.

One thing we do know is that people thinking about buying a car or large appliances are shopping now before the prices go up.

Berman coyly responded that moving the ticker to the other side of the screen won’t change the problem for Republicans.

When the camera panned out, the ticker was still positioned near Jennings and Berman joked that it was ‘following’ him.

‘Literally! Let me just get down here,’ Jennings responded as he hid under the table to escape the plummeting stock market.

—

One thing we do know is that people contemplating a car purchase or a large appliance purchase are shopping to complete that purchase this weekend.

Trump’s Destruction of the Country’s Economy

Tariffs Are a Self-Inflicted Economic Catastrophe that will make America hated by most of the world. Russia and its allies are loving this.

Dow drops over 1,400 as US stocks lead worldwide sell-off after Trump’s tariffs ignite

Financial markets around the world are reeling Thursday following President Donald Trump’s latest and most severe set of tariffs, and the U.S. stock market is taking the worst of it so far.

The S&P 500 was down 4% in midday trading, more than other major stock markets, and at its bottom in the morning was on track for its worst day since COVID struck in 2020. The Dow Jones Industrial Average was down 1,412 points, or 3.3%, as of 11:50 a.m. Eastern time, and the Nasdaq composite was 5.1% lower.

In President Donald Trump’s first term, apparel and footwear makers shifted manufacturing out of China to avoid tariffs. Now they’re being pummeled as Trump targets the same nations they moved to.

A tariff of 46% on goods from Vietnam is particularly painful for companies such as Nike Inc., Adidas AG and Lululemon Athletica Inc., which produce significant amounts of merchandise in the country. Levies of 49% on Cambodia and more than 30% on Indonesia and Thailand are also problematic. Trump says the tariffs will push companies to relocate manufacturing to the US.

America’s biggest trading partners promised retaliation for President Donald Trump’s massive tariff announcement. The first major response has come in — from Canada.

Canadian Prime Minister Mark Carney said that Canada will levy a 25% counter-tariff on vehicles imported from the United States that are not compliant with the United States-Mexico-Canada Agreement (USMCA) in response to US tariffs on Canadian vehicles and auto parts that went into effect today.

“As I told President Trump during our call last week, Canada will respond to the US auto tariffs, and today, I’m announcing that the Government of Canada will be responding by matching the US approach with 25% tariffs on all vehicles imported from the United States that are not compliant with CUSMA, our North American Free Trade Agreement,” Carney told reporters in Ottawa, using the Canadian acronym for the USMCA.

The prime minister said there were no talks scheduled between him and Trump, but he would talk to the US president again “if appropriate.” Carney also said Canada’s counter-tariffs would not affect auto parts.

Though Carney said Canada still considers the US an ally in defense and security, his country “must be looking elsewhere to expand our trade, to build our economy and to protect our sovereignty.”

Where will all this end? Look for a World Wide RECESSION.

Capitalism is the Driving Force in America

NYU Stern Business School Professor Scott Galloway shares his take on the public condemnation towards the healthcare industry after a suspect shot and killed UnitedHealth’s CEO Brian Thompson. He points out there is no sympathy for Thompson’s family. He says we do not have a democracy. We have a capital-ocracy where money is the driving force. There is no concern for the 90% of the country.

Capitalism is an economic system where private individuals and organizations own and control the means of production, and prices and distribution of goods are determined by market forces.

Approaching Retirement with little savings

If you are in your 60s with too little retirement savings, you aren’t alone. The median balance in defined contribution plans of those ages 55 to 67 is just $87,571, according to the Vanguard How America Saves Report.

Financial concerns are a fact of life for America’s retirees. In fact, an AARP survey found that 20% of adults ages 50+ have no retirement savings, and more than half (61%) are worried they will not have enough money to support them in retirement.

It’s not a comfortable financial position, as a $50,000 nest egg only allows you to withdraw around $2,000 in annual income, assuming you follow the 4% rule to set a safe withdrawal rate. With Social Security only replacing around 40% of pre-retirement income, $2,000 to spend each year from savings simply won’t cut it. You must find ways to boost your savings.

Be wary of quick money making schemes. Bernie Madoff’s Ponzi scheme, which ran for decades, defrauded thousands of investors out of tens of billions of dollars. Investors put their trust in Madoff because he created a front of respectability, his returns were high but not outlandish, and he claimed to use a legitimate strategy. In 2009 Madoff was sentenced to 150 years in prison.

My solution to this dilemma was a Reverse Mortgage on my house. It is an expensive choice but I can continue living in my house for the remainder of my life and Social Security pays my other bills.

Forget Multi-Level Marketing Businesses as a source of income. They are mostly Pyramid schemes. They can look remarkably like legitimate MLM business opportunities and often sell actual products, maybe even ones you’ve heard of. But if you become a distributor for a pyramid scheme, it can cost you and your recruits — often your family and friends — a lot of time and money that you won’t get back.

World’s Most Unaffordable Cities

The downtown skyline of Los Angeles, California as seen on January 22, 2024
Mario Tama/Getty Images/File

US cities on the West Coast and Hawaii occupied five of the top 10 most unaffordable places, according to the annual Demographic International Housing Affordability report, which has been tracking house prices for 20 years.

Perhaps unsurprisingly, the most expensive US cities to buy home are in California, where San Jose, Los Angeles, San Francisco and San Diego have all made the top 10.

Top 10 “impossibly unaffordable” cities

Hong Kong
Sydney
Vancouver
San Jose, California
Los Angeles
Honolulu
Melbourne
San Francisco/Adelaide
San Diego
Toronto

I am living in a house in Los Angeles that I bought over 40 years ago. So I am old and now the Los Angeles Department of water and Power just sent me a notice that my monthly bill will increase by 31% effective July 1.

I now take my wife food shopping and the usual weekly bill is about $150. Happily I do not drive my car great distances because the cost of gas is now about $4.50 per gallon.

Should I move to Nevada or Arizona? A cousin of mine moved to the Phoenix area this past summer.

‘2023 Was A Miraculous Year’

Nobel laureate Paul Krugman on Friday took exception to comments made by Republican presidential primary candidate Nikki Haley.

Haley offered a bleak take on the economy in a campaign speech in her home state of South Carolina on Wednesday. Criticizing her GOP rival Donald Trump for throwing a temper tantrum, Haley said, “He [Trump] didn’t talk about the American people once he talked about revenge. He didn’t talk about the fact that we’ve got an economy in shambles and an inflation that’s run out of control.”

Sharing excerpts of Haley’s comments from OK Magazine on X, Krugman said the economy grew 3% and core inflation was back at 2%. Haley repeated those claims on her Meet the Press interview on the Sunday January 28 program.

Krugman also said the six-month annualized rate of the core price consumption expenditure index should be considered as a more accurate inflation measure than the core annual inflation rate.

“Using annual core CPI puts you way behind the curve, for 2 reasons. First, annual: even core CPI was 4.6 in the first half of 2023, 3.2 in the second half. Second, known lags in official shelter prices lagging far behind market rents,” he said.

“So annual CPI creates a spurious impression of stubborn inflation, with a difficult last mile to cover.”

He observed that shelter receives a lower weight in the calculation of price consumption expenditure.

“The inflation battle is over. Now we need to worry that lagged effects of rate hikes will tip us into an unnecessary recession,” the economist said.