Banks fail and economy slows

May 5, 2023

Permission to republish original opeds and cartoons granted.

Peak employment still at hand with 3.4 percent unemployment as job openings continue to collapse, banks fail and economy slows

The unemployment rate still remains at historic lows of 3.4 percent in April, according to the latest data by the Bureau of Labor Statistics, amid other worrying signs for the U.S. economy including a continued collapse of job openings, a string of bank failure and an overall slowing Gross Domestic Product (GDP). Job openings continued a months long collapse, from 12 million in March 2022 to 9.6 million in March 2023. Usually prior to a recession, job openings will peak, followed by an upward trend of unemployment. But the sheer magnitude of job openings are due to retiring Baby Boomers: the number Americans not in the labor force 65 years old and older has increased 3.27 million since Feb. 2020, from 28.3 million to 31.4 million today. To the extent that a recession might be tempered appears to be by the continued labor shortages as the Baby Boomer retirement continues. Something’s got to give.

Video: Press Secretary Karine Jean-Pierre Blatantly Lies About School Re-Openings

Press Secretary Karine Jean-Pierre is being blasted for being dishonest about the administration’s prioritization of reopening of schools after the pandemic when she said, “This is why, when the president walked in, he made a priority to open schools, one of the things that was important to do to make sure that our kids, who have lost so much, were able to go back in-person school if they choose, have the resources that they needed to really succeed and move forward in their education.”

Video: Jim Jordan Forces Teachers Union head to Admit Parents Matter

Jim Jordan confronts teachers union boss and asks her who is responsible for the culture war and if parents matter.

Here are the Groups Biden is Most at Risk of Losing to Robert F Kennedy or Other Primary Challengers

Since President Joe Biden announced his reelection campaign for president, political dynasty Robert F Kennedy Jr. and former 2020 Democratic primary contender Marianne Williamson have risen in the polls, largely due to the fact that most Americans don’t want to see a Biden second term. While Biden’s numbers are down with Democrats and leaners across the board, there are four key groups with which he polls particularly badly. These groups could jeopardize his reelection prospects if they break for a Democratic primary challenger and refuse to return and support him in the general election. Independents, young people, women, and white-non-college Democrats are the constituencies Biden is most at risk of losing, and it is no surprise that newcomers Robert F Kennedy Jr. and self-help author Marianne Williamson are picking up support from these cohorts. According to a recent Emerson College poll, Kennedy is now polling at 21%, while Williamson polls at 9%. Kennedy's performance in the poll is notable, with 17.1% of Democrats and an impressive 33.7% of Independents giving their support.

U.S. Senator Lankford to Join ALG live at 4 p.m. to Discuss the Fight for Fiscal Sanity

U.S. Senator James Lankford, (R-Okla.) will be joining Americans for Limited Government President Rick Manning on Friday, May 5 at 4 p.m. EDT on YouTube, Rumble, Twitter and Facebook to discuss Senate GOP actions to cut the size and scope of government as part of any debt ceiling increase. Senator Lankford participated in a May 3 press conference featuring fifteen other Senators on Wednesday showing solidarity with House Republicans in this showdown over the fiscal future of America.

 

Peak employment still at hand with 3.4 percent unemployment as job openings continue to collapse, banks fail and economy slows

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The unemployment rate still remains at historic lows of 3.4 percent in April, according to the latest data by the Bureau of Labor Statistics, amid other worrying signs for the U.S. economy including a continued collapse of job openings, a string of bank failure and an overall slowing Gross Domestic Product (GDP).

In the survey, as the population increased by 171,000, those not in the labor force increased by 214,000 as labor participation dipped slightly by 43,000. Those who said they had a job increased by 139,000 after a 577,000 increase in March. As a result, the unemployment rate has actually ticked downward for two consecutive months from 3.6 percent in February, to 3.5 percent in March and now 3.4 percent in April.

Still, other data continues to show growing weakness in the overall economy, as job openings continued a months long collapse, from 12 million in March 2022 to 9.6 million in March 2023. Usually prior to a recession, job openings will peak, followed by an upward trend of unemployment.

And yet, the sheer magnitude of job openings remains something of a puzzle for economists and financial pundits, after skyrocketing after the Covid pandemic. But a key metric to consider are retiring Baby Boomers: the number Americans not in the labor force 65 years old and older has increased 3.27 million since Feb. 2020, from 28.3 million to 31.4 million today.

This is a situation akin to Japan, which similarly has experienced demographic decline the past few decades with a rapidly aging population following very low fertility rates. During the financial crisis and Great Recession of 2008 and 2009, the unemployment rate only reached 5.7 percent (here it reached 10 percent in Oct. 2009), and just 3.2 percent during the Covid recession.

Meaning, labor shortages can have a discernable impact on how recessions are felt, and may be one of the factors to consider moving forward as other signs may yet be pointing to a downturn on the horizon.

The U.S. Gross Domestic Product (GDP) grew at a less than expected 1.1 percent annualized in the first quarter of 2023,according to the latest data from the Bureau of Economic Analysis, down from 3.2 percent in the third quarter of 2022 and 2.6 percent in the fourth quarter in 2022.

There is also inflation, which peaked at 9.1 percent in June 2022 and was down to 5 percent in March. Usually peak inflation followed by a slowdown in the increase in prices also precedes a downturn.

Another key predictor has historically been the spread between 10-year treasuries and 2-year treasuries, an inversion of which usually predicts a recession on the horizon as long term growth is perceived to be lower than short term growth. The 10-year, 2-year inverted briefly in March 2022 and then succumbed fully in July 2022, where it has remained. Usually, as a recession comes, this spread will uninvert itself, which may be starting to happen, as it has gone from -1.03 percent in March to now just -0.38 percent. It hasn’t uninverted yet, though, something to keep in mind.

And then there is the string of regional bank failures to date: First Republic Bank, Silicon Valley Bank and Signature Bank all were placed into FDIC receivership in the past month or so—the second, third and fourth largest bank failures in American history—with more perhaps on the way.

Shares of PacWest have collapsed nearly 90 percent since February, Western Alliance Bancgroup by 77 percent and Zions Bancorpation by 63 percent. Overall, the SPDR S&P Regional Banking ETF is down 44 percent since February. Similar drops in the stock values of First Republic, Silicon Valley and Signature banks signaled their ends too, and could point to more financial stress on the horizon.

All of those factors still appear to point to a recession dead ahead, as the White House Office of Management and Budget and the Federal Reserve still project the unemployment rate to rise to 4.6 percent in 2024, an implied 2 million or so job losses between now and then. To the extent that might be tempered appears to be by the continued labor shortages as the Baby Boomer retirement continues. Something’s got to give. Stay tuned.

Robert Romano is the Vice President of Public Policy at Americans for Limited Government Foundation.

To view online: https://dailytorch.com/2023/05/peak-employment-still-at-hand-with-3-4-percent-unemployment-as-job-openings-continue-to-collapse-banks-fail-and-economy-slows/

 

Video: Press Secretary Karine Jean-Pierre Blatantly Lies About School Re-Openings

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To view online: https://www.youtube.com/watch?v=V3_02Gvb40w

 

Video: Jim Jordan Forces Teachers Union head to Admit Parents Matter

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To view online: https://www.youtube.com/watch?v=934tLC3qBiM

 

Here are the Groups Biden is Most at Risk of Losing to Robert F Kennedy or Other Primary Challengers

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Since President Joe Biden announced his reelection campaign for president, political dynasty Robert F Kennedy Jr. and former 2020 Democratic primary contender Marianne Williamson have risen in the polls, largely due to the fact that most Americans don’t want to see a Biden second term.

While Biden’s numbers are down with Democrats and leaners across the board, there are four key groups with which he polls particularly badly. These groups could jeopardize his reelection prospects if they break for a Democratic primary challenger and refuse to return and support him in the general election.

Independents, young people, women, and white-non-college Democrats are the constituencies Biden is most at risk of losing, and it is no surprise that newcomers Robert F Kennedy Jr. and self-help author Marianne Williamson are picking up support from these cohorts.

According to a recent Emerson College poll, Kennedy is now polling at 21%, while Williamson polls at 9%. Kennedy's performance in the poll is notable, with 17.1% of Democrats and an impressive 33.7% of Independents giving their support.

Just a month ago, Kennedy was polling at 10% and Williamson was polling at 4% according to a Morning Consult poll, indicating both challengers have doubled their positions recently.

Overall, Kennedy polls best with women, voters over age 65, and non-college educated Democrats, while Williamson gains her largest support from women, younger voters, and college-educated Democrats.

In the Morning Consult poll, which was conducted when support for Kennedy was only at about 10% nationwide instead of the current 21%, 13% of women compared to 7% of men said they’d support Kennedy as a primary challenger.

Source: Morning Consult

For voters over age 65, 17% said they’d support Kennedy compared to roughly 9% for all younger groups, and 12% of non-college Democrats said they’d support Kennedy compared to 10% of college-graduates. This indicates Kennedy has more of an edge with working class voters and older voters who may remember the legacy of John F Kennedy fondly, as well as Democratic women who are less reluctant to support Biden than Democratic men are.

In fact, it is interesting just how far Biden’s numbers have fallen with Democratic women compared to men. There is a nearly twenty-percentage point difference between the share of men who say they’d support Biden in the primaries (78%) compared to the share of women who say the same thing (61%).

Former long-shot 2020 Democratic primary challenger Marianne Williamson who recently announced she will once again challenge Biden polled at 9% in the recent Emerson College poll, up from about 4% in March. Like Kennedy, Williamson polls better with Democratic women than she does men, but she has much stronger appeal with younger Democrats than older groups, and polls slightly better with college-educated Democrats.

In the Morning Consult poll, Williamson polls at 4% with women compared to almost zero with men, and slightly better with voters aged 18-34, garnering 7% of their vote compared to roughly 4% for older age groups. Williamson also polls better with college-grads, securing 5% of their vote compared to 0% for non-college grads. She also polls better with whites than Blacks.

Neither poll broke out Hispanics separately, but if Biden’s favorability in the polls is any indicator, they may be open to a new challenger. Minorities show weak support for Biden, with almost half of Hispanics (48%) and nearly a quarter of Blacks (24%) disapproving of his job performance, according to an April Fox News poll. A March Quinnipiac poll also found just 19% of Hispanics approve of the job Biden is doing as president, while a full 70% disapprove. Minorities may not yet be embracing Biden’s challengers at quite the same rate as white Democrats seem to be, but this could change.

Women, Independents, young people, and working-class whites are all groups Biden is currently at risk of losing, and with the entry of intriguing – if long-shot – hopefuls like Kennedy and Williamson, an increasing share of Democrats and leaners are moving away from Biden. Now, it is very unlikely either of these non-conventional primary challengers will secure the resources and backing of the Democratic Establishment to seriously present a challenge to Biden, but the momentum behind them certainly isn’t helping him. If shares of these voters end up supporting Kennedy, Williamson, or another serious contender in the primaries, there is no guarantee they will consolidate their support behind Biden in the general election if he is forced on them by the establishment.

The Biden Administration’s lack of action to address the rising cost of living, unjust vaccine mandates, closure of wide sections of the U.S. economy, and mishandling of the war in Ukraine, are all issues that hit hard at core Democratic constituencies, including anti-war coalitions, women, young people, and the working class. These groups are hungry for change, and they may end up consolidating support behind a long-shot candidate in the primaries and sitting out or defecting to a more populist candidate in the general election.

Manzanita Miller is an associate analyst at Americans for Limited Government Foundation.

To view online: https://dailytorch.com/2023/05/here-are-the-groups-biden-is-most-at-risk-of-losing-to-robert-f-kennedy-or-other-primary-challengers/

 

U.S. Senator Lankford to Join ALG live at 4 p.m. to Discuss the Fight for Fiscal Sanity

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U.S. Senator James Lankford, (R-Okla.) will be joining Americans for Limited Government President Rick Manning on Friday, May 5 at 4 p.m. EDT to discuss Senate GOP actions to cut the size and scope of government as part of any debt ceiling increase.

Senator Lankford participated in a May 3 press conference featuring fifteen other Senators on Wednesday showing solidarity with House Republicans in this showdown over the fiscal future of America.

The lively and informative conversation will be broadcast on YouTube, Facebook, Rumble and Twitter on Americans for Limited Government’s channels on these respective platforms. You can follow Americans for Limited Government on:

YouTube: @AmericansforLimitedGovernment

Twitter: @LimitGovt

TruthSocial: @LimitGov

Facebook: AmericansForLimitedGovernment

Rumble: AmericansforLimited Government

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To view online: https://dailytorch.com/2023/05/u-s-senator-lankford-to-join-alg-live-at-4-p-m-to-discuss-the-fight-for-fiscal-sanity/ument you want to convert into a text editor, then switch to HTML, view to generate the code.

 

 

 

 

 

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