Mr. Powell & the President, the PCE, Jobs, Consumer Confidence, Lilo, Stich, Ethan and the Movies, and a Penny for your thoughts.
Jerry Powell and the President
Fed Chairman Jerome Powell met with the President. Here is the statement put out by the Board of Governors of the Federal Reserve System:
“At the President's invitation, Chair Powell met with the President today at the White House to discuss economic developments including for growth, employment, and inflation. Chair Powell did not discuss his expectations for monetary policy, except to stress that the path of policy will depend entirely on incoming economic information and what that means for the outlook. Finally, Chair Powell said that he and his colleagues on the FOMC will set monetary policy, as required by law, to support maximum employment and stable prices and will make those decisions based solely on careful, objective, and non-political analysis.”
Jerry is going to go by the data, not the noise.
Speaking of data, the Fed has only two objectives, which are stated in the press release: to set monetary policy to support maximum employment and stable prices.
That’s why they really focus on inflation and jobs and adjust interest rates accordingly.
Speaking of Inflation
The PCE – Personal Consumption Expenditures index – numbers came in on Friday.
Inflation for the previous 12 months came in at 2.1%, below expectations of 2.2% and the previous month’s 2.3%.
The core measurement of annual inflation dropped from 2.7% to 2.5%; expectations were for 2.6%.
Expectations exceeded on both marks, and no doubt noticed by the Fed.
Initial jobless claims came in slightly higher than expected, at 240,000 new claims vs. 230,000 expected. Last week, it was 226,000. I’ll bet the Fed is keeping an eye on that.
Consumer Confidence was a big surprise.
In April, consumer confidence had a score of 85.7. The consensus was for a score of 86 for May.
It came in at 98. Expectations exceeded.
Much of the increase in confidence was based on expectations for the next six months.
Driving that confidence was the tariff truce with China.
Could things be breaking through the noise? Fingers crossed.
Going to the Movies
This past Memorial Day had the best movie turnout in years.
AMC stated that all-time records were set for admissions revenue, food and beverage, and overall revenue.
In terms of attendance, this was AMC’s best Memorial Day Weekend since 2013.
AMC stock was up 24% last Tuesday alone.
Regal Cinemas sold 3,200 tons of popcorn. That’s not buckets, folks, that’s tons!
Approximately 6 ounces per bucket yields 5,333 buckets in one ton.
That’s 17,065,600 buckets of popcorn.
I like mine buttered.
Lilo & Stich and the Impossible Mission Force carried the day.
SoCal Jobs
What are jobs in Southern California looking like? That would be L.A., Orange, San Bernardino, and Riverside Counties.
For the last twelve months, the three industries that showed the best job growth were:
Healthcare – up 38,000
Social Assistance – up 32,300
Government – up 23,600
The three Industries that showed the most significant job losses were:
Construction – down 14,700
Fast Food – down 11,200
Manufacturing – down 22,200
To me, the correlation is clear: In California, every time you hire a government employee, you lose a manufacturing job. If you're familiar with California, that makes perfect sense.
A Penny Saved is Worth 3.7 Cents
Should we keep the penny? Hmmm.
It costs 3.7 cents to make a cent.
Conversely, it costs 13.8 cents to make a nickel, 5.8 cents to make a dime, and 14.7 cents to make a quarter.
Technically, we should get rid of nickels, too.
The penny was first minted in 1792 and featured Lady Liberty.
Abraham Lincoln was the first person to be featured on a circulating coin; that was in 1909.
E Pluribus Unum has been used on coins and paper money since 1795.
E Pluribus Unum – Just in case you forgot, it means “Out of many, one.”
And the Treasury Department said this past week it was phasing out the penny.
I guess your thoughts will now cost a nickel.
The Quote of the Day
The trouble with opportunity is that it always comes disguised as hard work.
Herbert V. Prochnow
The question is, are you willing to work hard? Because if you are, opportunity may knock. Now go out and make your opportunity. We’re almost halfway through the year.
