David Rosenberg: Jobs Shock About To Hit?

Bad data & bad policy will force the Fed to scramble to cut rates

Today's guest expert just released a warning that the official jobs data reported by the government are "overstated by historical proportions".

And when the downward revisions get released, it will shock both the Federal Reserve and the financial markets.

For the details on this, we turn to the man who wrote the report, highly-respected economist & award-winning researcher David Rosenberg, founder & president of Rosenberg Research.

Bad data leads to bad policy, and David thinks the predictable outcome of all this will be the Fed being caught in a mad scramble to cut rates once it realizes the job market is not nearly as “robust” as it currently estimates.

For all the details, click here or on the image below:

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Adam’s Notes: David Rosenberg (recorded 5.6.24)

Executive Summary:

• David sees the global economy as "flat," with significant regional variations. He notes a general deceleration in global GDP growth, with the U.S. slowing down significantly from previous highs to 1.6% in Q1, and Europe showing stagnation despite avoiding recession. Canada is struggling with real GDP contraction adjusted for population growth. China and Japan aren’t doing much better; but India is bucking the trend, seeing tremendous productivity-led growth.

• He views the US. financial markets with caution, citing highly speculative prices. He sees better current opportunities in markets like India, Japan, and Hong Kong, which benefit from structural reforms and historically favorable valuations.

• Europe has surprisingly avoided a recession. The U.S. has, too, mostly due to the surge in fiscal spending which has served to delay the arrival of recession (but not detail it completely). However, David warns of potential economic challenges ahead due to unsustainable deficit spending, over $7 trillion of corporate debt re-rating to much higher levels in coming years, and the deterioration of the consumer household’s financial condition.

• David criticizes the Federal Reserve's reliance on lagging AND flawed employment data. His analysis shows that non-farm payrolls are overstated by