Archive for July 2018

FICO scores are determined as follows: payment history is 35%, prompt is best; amount owed counts for 30%, less is best. Length of credit history is 15%, longer is better. Credit mix is 10%, varied debt types are superior to one type. Lastly, new credit counts for 10% and applications lower your score. 200 million…

When tariffs are imposed on imported goods, a big loser is. . . exporters! As we reduce imports from, say, Canada, Canada’s economy and currency weaken, and its’ imports from us decline. And, if, as desired, the tariff boosts domestic demand for a protected product (think cars), that boosts domestic prices and wages, pushing up…

In yet another sign of labor market tightness, the percentage of persons who quit their jobs in May was 2.4%, the highest level since January 2001, and higher than the 2.2% attained during the peak of the Housing Boom. 2.4% translates into 3.56 million people/month quitting their job, or almost 43 million employees/year. Those who…

The Friday File: In 2013, coca-plant production in Colombia bottomed at 119,000 acres. It’s since skyrocketed to 361,000 acres and Columbia now accounts for 68% of global coca plant production, a new high. Not to be left out, opium-poppy production in Afghanistan is also up from 346,000 acres in 2010 to 815,000 acres in 2017;…

North Korea has conducted six nuclear tests. While that does not sound like many, only five nations have conducted more such tests since 1945. The US leads the way with 1,032 tests, followed by Russia/USSR with 715, France with 210 and China and the UK with 45 each. The only other countries that are known…

Judge Brett Kavanaugh will, whenever possible, vote to rein in federal agencies and their vast and growing rulemaking authority, absent clear congressional authorization. This includes regulations on housing, net neutrality, global warming, credit card fees, labor laws, and much more. Kavanaugh has repeatedly attacked Chevron v. NRDC (1984) and the idea of courts giving deference…

Already announced trade tariffs should reduce GDP by 0.1% at peak impact in mid-2019. If widened to include all proposed tariffs including autos, a 10% tariff on $400 billion of Chinese goods and equivalent retaliation, the temporary maximum hit to GDP would be 0.5% by summer 2019. The worst-case scenario, of not a 10% but…

Net June job creation was a strong 213,000, and April and May numbers were collectively revised up 37,000! The unemployment rate rose to 4% from 3.8% as the labor force participation rate pleasantly climbed to 62.9% from 62.7%. Wage growth remained quiescent at 2.7% Y-o-Y; 0.2% M-o-M. This is economic Goldilocks; how long it lasts…

The Friday File: 55 years ago this week, a retailer opened an 18,000 square-foot discount store in Rogers, Arkansas called Wal-Mart, as the proprietor’s name was Sam Walton. Today, there’re 11,718 stores in 28 nations, and Walmart is the world’s largest company by revenue at $486 billion/year. That would make it the 26th largest nation…

May pending sales of existing houses declined 0.5%, are at a 4-month low, and have declined Y-o-Y for 5 straight months. Similarly, existing home sales in May declined slightly and through 5/18 are down 1.4% compared to January-May 2017. They are down Y-o-Y for three straight months. Lastly, first time mortgage applications for the week…