tv Mornings With Maria Bartiromo FOX Business September 2, 2022 8:00am-9:00am EDT
the biden administration, keeps talking about democracy, i am longing for that moment, when the biden administration finally, defines dmoek i don't know what they are talking about fodder or conspiracy theories extreme views, people in this country, that might be controlling what we think what we do, so on. jackie: a great point, i think going to be a big topic of conversation it was pre-covid then sort of fell by way sided focus attention coming back on it john todd, stay right here next hour of "mornings with maria" starts right now. . . >> good morning, everybody. i'm jackie deangelis for maria bartiromo, friday, september 2, your top stories at 8:00 a.m. eastern time. president biden, attacking
maga republicans again in a fiery speech, claiming equality and democracy are under assault, more on the president's midterm message to americans, after promising to unite. >> futures down bouncing around you've got some upside on dow one point indicated higher obviously, all as market waiting to look ahead to, that jobs' report 30 minutes' time economists expecting 300,000 nonfarm pay roles added to the economy with unemployment rate 3 1/2%, that would be staying steady. this after stocks had a mixed close yesterday kicking off the first day of a new trading month you can see the dow higher by 145 points, but was nasdaq seeing lowest close since july 26th, over time prices continue to be in focus, still below 100 dollars a barrel seeing two weeks, two week lows over growth worries falling to lowest price seen
since january being to look at european markets up across the board dax we largest gain 1.37% in asia overnight a different story the markets mixed, only shanghai composite had a little gain "mornings with maria" is live right now. . >> good morning, everybody. president biden's midterm message to americans, democracy is under assault by president trump, and millions of americans, who support him. listen. >> donald trump and maga republicans, represent an extremism, threatens the very foundations of our republic they do not believe in the rule of law do not recognize the will of the people, maga forces are determined to take this country backwards. backwards. to an america where there is no right to choose. no right to privacy. no right to contraception to mary who you love.
>> unclear, if the divisive message will help or hrt democrats in november, a "the wall street journal" poll shows democrats are building momentum ahead of midterms important to note poll taken before biden announce 5d00-billion-dollar student bailout plan john lonski todd, great to have you both as copilots the president attacked half the country saying you are sending us backward premium broadly calling maga republicans, they would say no we're trying to stick to the core values of the country you are trying to take this -- this country, toor far progressively away from core valley. >> one hundred percent i agree this argument joe biden trying to make goes beyond that basically like you heard putting america into two camps saying for those poise visit
u.s. of making america great again your tied to two things tied to january 6th and voting laws this is this attack on democracy that he pins on these people first of all, january 6 i don't know one maga republican that i have spoken to that says january 6 was great day no one said that they weren't there there was a tiny subset of people that were you there can't pin paint a broad brush for 74 million voting pub, on voting laws, maybe i am off base here when it comes to the voting laws, but these voting laws are designed to make sure, that integrity is paramount the people that fought and died made so many sacrifices so people could vote, do you think they are looking at the sacrifices thoorp asked voters to make, get an id. >> get an id. >> show one day get on one tuesday no november to show up, is that that onerous this is broad brush painting people
with in fact the actual individual hurting advocacy one joe biden we can go down list short on time raided home top political opponent that is not definition of k executive order could democracy. >> under biden the economy is going back wards entire country going backwards we have declining student performance, we also find that life expectation is shrinking in this country, prices are rising much more quite a while ago than wages that means that the real purchasing power of the dollar is shrinking, we are going backwards but not because of the republicans, something taking place, under biden's leadership. >> interesting, i keep reiterating this administration 19 months spent over four trillion dollars americans are going to have to
pay for that. >> what did you get for it? nothing and in fact labor productivity in second quarter, labor productivity suffered deepest year-over-year decline, on record, the record begins 1948. that doesn't say good things. jackie: right doesn't. >> about the current state of the economy. jackie: we are talking a lot about job market very important part of this economy as we move forward dictate how jerome powell at a good sense where we are we get that jobs' report coming out in 25 minutes' time or so, coming up americans now questioning, who is behind biden's student loan bailout who will reap benefits kentucky congressman james comer to weigh in on that next we are 20 minutes away from august jobs' report breaking down everything you need to know i don't mean to miss a moment of it maria" continues live.
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>> . >> -- >> why -- i bet a lot of i don't are staff does so that they may i don't -- no one told me they have. jackie: president biden yesterday, telling reporters not sure that staff has any student loans, raising ethical concerns about administration officials with student loans who worked on biden bailout policy could benefit finely james comer ranking member oversight committee good to be with you this morning. thank you so much for joining us, if i may start, with that sound bite right there he says
he doesn't know if any staff members have student loans sounds like people who drosted policy are the ones that have the student loans will receive, the stimulus. >> that is exactly right the ones who crafted this legislation stand to benefit the most, joe biden probably does not know that a lot of republicans asked the question who is calling shots in biden administration clearly, high level staffers cabinet secretaries another example of eye ethics violation within this administration they have excessive alters of student student debt went to very and have schools liberal schools i might add the ones that crafted this policy, this is something you are not supposed to do you are not supposed to craft legislation, that directly benefits you or your family once again, the mainstream media turns blind tie another ethics violation
by biden administration. jackie: s you released a letter yesterday demanding facebook keep communication with fbi reporting information on hunter biden's laptop, of course, this is coming after mark zuckerberg ceo of the company recently admitted to suppressing stories about the laptop, when it first broke almost two years ago a lot of people enraged saying that was information might have changed how they volunteered in the election at issue here tell me he more. this is a big deal i am pretty confident facebook going to work with us on this i don't think any secret facebook was going to be under a microscope because of conservatives what we've learned what i expected all long people in biden administration, as well as potentially democrat national committee were communicating with facebook, the big government was telling facebook you can't put that story let any one post that story about hunter laptop,
because sound a whole look like russia disinformation to me facebook had no choice but to censor that we know that was true fbi should have nope at the time that was true if they didn't, this is another black eye on fbi, i think the highest levels did know it was true did everything in ability to suppress the story to try to help joe biden to try to get rid of donald trump, so we are asking for all communications, between, the administration, and facebook, as well as the democrat national committee and facebook we believe they were involved as well we are, we filed legislation, jim jordan and i to expand the high track to whereabout administration officials whoever next administration is cannot influence social media companies on what they post in platforms. jackie: congressman comer great to chat with you as always facebook obviously, is in the crosshairs, because mark zuckerberg, ceo, founder went on joe rogan podcast admitted he had communications
with the fbi. should anybody else any other tech companies media companies be expecting a call from congressman comer with regard to any communications they may have had with the fbi. >>. >> you can sure bet twitter will receive the same type of request later on, they are two main social media platforms, this is a very serious, this has been a huge frustration, among conservatives for a o long time, that they were being unfairly censored on social media companies at the same time that terrorists were allowed to post things, answered liberals could post whatever they want about donald trump, maga republicans, so this is something that is not allowed. if you work for the government if you are getting paid by the american taxpayers you should not be spending your time demanding that social media platforms prohibit free speech on their platforms because you don't agree with that free speech, we believe that is violation of the hatch
athtrying to make legislation more clear to where that never happens again. jackie: final point here, congressman. saying that facebook should preserve any fbi communications, on hunter biden story that they regularly discussed censorship with social media when it came to covid-19 other things emails show it. >> yeah, we believe that that is fair game too. we have already unearthed emails show dr. collins dr. fauci communicated often concerned about spin so to speak, from the lab leak theory they wanted to spin story this was man-made that, the government had nothing to do with anything that was going on at wuhan lab we now know wasn't true we've seen emails show dr. fauci dr. collins were very concerned
about immediate reporting origination of covid vaccines masks things like that we believe there was you know, the biden administration, was very involved, in our -- you know, virus healthcare policies in political manner very you are not to children we are going to try to get all that out in public. jackie: you are bringing up a great point very unfortunate did have impact starting to see statistics come out show kids suffered during pandemic what are you seeing in press media communications from white house karine jean-pierre blaming president trump for schools being closed not admitting this administration missing managed reopening not admitting teachers union blue state schools continued to stay closed. >> i am pretty confident with all communications made public that will happen in a republican administration, that the american penal will see, that the teachers union was communicating, very
closely with the biden administration, and this was a priority for them, to say virtual every that parent had kids including myself going through virtual learning loss at year of education because of that, we now know that wasn't needed so this is something else the american people deserve answers to republicans majority going to try to get answers for the american people. jackie: there has to be about the accountability, thank you. >> futures plat wait on auk jobs' report out in a few minutes we've got all-hands-on-deck, you don't want to miss that coming up after the break. . ♪ shine for you, everything you do, ♪ . new projects means new project managers.
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every search you make, every click you take, every move you make, every step you take, i'll be watching you. the internet doesn't have to be duckduckgo is a free all in one privacy app with a built in search engine, web browser, one click data clearing and more stop companies like google from watching you, by downloading the app today. duckduckgo: privacy, simplified. jackie: welcome back, august jobs' report out in minutes, economists expecting 300,000 jobs added last month with the unemployment rate holding steady at 3.5% again that is the expectation, here to break it down, macromavens president
stephanie pomboy chief workforce analyst employ bridge joanie bliley, wealth mkt senior vice president head of public markets group ericsson through john lonski todd pyro i want to talk about what everybody is expecting stephanie i will start with you futures right now are kind of flat dow indicated higher by 29 not really making a move ahead 246 how significant do you think today's report is going to be, with respect to the to the market? >> o well sadly, we have this myopic fixation on payroll number which i employment is lagging indicator in general payroll survey is especially lagging, so it is a little bit disappointing that we are hanging all of our you know putting all eggs in this bass account but that is what powell has us doing i gave us very meaningful for the
markets as they try to figure out, when and if fed is actually going to pivot. those -- expectations have been dashed, but i think, you know this again, it is a lagging indicator so while we are all expecting to see some sort of numbers this is going to take a while real-time indicators of the economy have really imploded too bad navigating through rear view mirror this is where we are. >> you bring up good points we had a guest talking about the fact market may we rooting for a big misif we saw a miss in this report you might see jerome powell not as aggressive with his rate increases. >> right i think you know you are hearing that this report is going to be one of the most important reports maybe even more important than the cpi number, because, all eyes are looking to see if this is a
bad you know bad number will the market kind of rally. it is very hard to predict this number, i know. we started to see a little bit of a slowdown in employment job postings, but over the last two weeks o we've had a few reports that the shown job options are up over 11.2 million open jobs in the united states we saw low unemployment claims this week you are starting to see some numbers that could you know actually predict we might be pretty good number today, then again, a good number might be bad for the markets. >> stephen moore adp a business miss sense getting adp trying to work on being more correlated to numbers some say no that is what they are expecting but also when you dig into this jobs' report even if we get say in line with expectations, unemployment rate 3 1/2%, you know two things that we really look at right now are the
labor force participation, and also wage growth, what do you think we are going to see? >> yeah, i was going to say that this i think the most important statistic in minutes is what is going down labor force participation when you have big gap between number of jobs that are out there number of people looking for jobs, that is a big, there is another thing that was touched on really important, the last three months there has been a big, big gap between two reports, the report of payroll, and the report of you know, the individual households, this has been a big, big gap why i think employing to -- we may see a low number establishment survey today. jackie: i am watching futures putting up on screen dow indicated higher 29 s&p higher nasdaq a little bit of a drop still market pretty tepid, lisa your expectations,
because this is also a holiday weekend, labor day this is a very big data point for market tends to be one of the weekends volumes are typically lower people come back after labor day get more serious about trading strategies don't want to put big positions on necessarily before a holiday. >> we are seeing a little bit more as placeholder report, as stephanie was mentioning important for economy works continue to have opportunities in turn helps power consumer, right now fed really is a driver of the market they ultimately are focused on those price pressure numbers. and so really, if we come in around, a range of consensus or even slightly weak isn't going to change fed calculus as far as where they are moving in terms of market reaction what we expect it would really take again a pretty sober number i think to get the market rallying as far
as bad news is good news types of mentality. >> stephanie back to you jolts report indicating 11.2 million job options in this country what we learned the l.a. noi. report some people going back to labor force trying to get second jobs but you've got a huge, population on sidelines we don't have federal stimulus payments but local governments are handing out checks people as we head into fall back to school other things incentivized people to stay home continue to do it. there is a huge disconnect with people not returning to labor force people who are trying to double or triple jobs here. >> here in colorado people received i think 750 dollars from state inflation rebate has opposite effect, you are right stimulus has continued, supported people staying at home. but i think this is an
interesting story to watch, jackie, going forward that is, people look at 401 kcht's talking about 301 ks to the existent seeing reverse wealth effect he can in terms of the stock market housing housing activities imploded volume precedes price i think softening in price might force early retirement to contemplate coming back to workforce i agree with steve i think labor force number is going to be very interesting to watch it may be too early people may be living off high of july 401(k) monthly statements the august one, maybe things will change. jackie: short-lived taking in a break john and i talking about wealth destruction after jerome powell indicating more pain ahead comment on that. >> not getting any better we find market, u.s. common stock down 2 1/2 trillion dollars,
that is like 10% gdp, since powell spoke last friday will probably deepen as wealth disappears a strong incentive to get back into the job market people will begin to rethink why they retired early. could show up in labor participation. if i could bring in you economy is a huge issue in midterms this is how people o vote a lot of people do vote with pocketbook maybe not initially when impact of inflation sets in it has now we are going to have sometime to come all of a sudden starts to make people we think at voting booth. >> messaging perspective will remain that if republicans, keep it so, if republicans get distracted by bait provided by democrats ie roe v. wade, things along those lines democracy -- >> the number. >> let's do it 315,000 coming in for nonfarm jobs a slight beat over estimates, 315,000 the estimate for 300,000.
this again is not the number we got in july, remember? we had in july, we had 528,000 so month-to-month, big drop but over estimates 315,000 estimate for 300,000, now to the unemployment rate jumped a little bit that went to 3.7%, we were looking for 3 1/2% would have been unchangeded that jumped, now going into other issues here, a lot of -- steve i snow stephanie you want labor force participation 62.4%, is your labor force participation rate, private sector jobs, 308, that is a little bit better than 300,000 for private sector jobs, factory jobs, 200,000, excuse me 22,000 i wish -- 22,000, estimate was 20,000 there, goods proufg jobs 45,000
construction jobs 16,000, as for other things looking for in report government jobs we saw a gain of government jobs, of 7,000, but that is a lot weaker than july government jobs government not hiring for month of august, now going through some other things factory jobs a gain 22,000, average hourly earnings for all private workers gain .3%, that is weaker than we were looking for the estimate was looking for .4%. so average hourly earnings excuse me, dropping just a little bit. now ill going to dig into the report other things with within the actual report jump into this quick can being give is kind of a sense of where actual street was a within the jobs' report saying that notable job gains occurred in
professional business services saw notable gains in healthcare, and retail trade, that is what the fovt is saying with a strongest numbers were, as for people that were not able to find work, but looking, excuse me couldn't find work because employer closed or lost business 1.9 million people, i want to say numbers that last number that is close to what we used to see before the pandemic, so kind of back, as far as pre-pandemic levels for that particular number wholesale trade, mining jobs 6,000 jobs added, leisure hospitality has been strong few months everybody that actual is kind of tapering off a little change 31,000, jobs, so again, we are seeing, a definitely this is a tepid report i am going to say tepid report quick, as far as the average workweek that decreased by .1% to 34 1/2
hours, that is the average workweek again 34 and a half hours, and then i gave you those numbers as far as the -- as far as the average earnings month-to-month, one more number going to give to you guys, yeah -- >> i am giving -- just about to do that. jackie: smart -- >> there you go year offer year, estimate was for 5.3 be came in 5.2, that is what i was going to give you. jackie: important numbers i react to that thank you so much, cheryl for doing that for us want to react to that the headline number was a little better than expected we did see unemployment to 3.7% wasn't expected i wondered if that has to do with participation rate going up a little bit your take on that. >> yeah, this may be one of those strange situation where increase unemployment rate may be good could mean more entering workforce something we all want to see.
i believe right now it is a strong labor market no question if you want a job there, out there, that is that is a strong story. we're starting to see inflation come down a bit, as well so that is that is a welcome store as well, i still think biggest store right now for businesses is where are the workers, even with this increase in labor force participation rate you've got a big gap, the question will be and i didn't hear the wage data i didn't maybe i missed that. >> i have it for you average hourly earnings up .3% month on month at 5.2% year-on-year that was monthly number a little bit under expectations. >> remember inflation at somewhere around 8%, so you still have that gap between inflation, wages, over last year workers lost about 3% in terms of real wages, that is a real pinch downwards.
>> impacts people cheryl has revisions for us. cheryl: we saw revisions for june, july the june revisions was pretty substantial arrived down 105,000 jobs initially 398,000 now 293, july rifgs down by 2000 combine 107,000 jobs down, for june and july, that was the revision the panel how you think markets trying futures sharply higher joanie to you dow indicated higher by 161 the markets' read how do you there mr. market is interpreting the numbers we just got. >> it is interesting jackie, because this actually is a pretty good report. and even though we are seeing unemployment tick up steve moore was talking about, he is exactly right, it went up for a good reason.
we saw 786,000 people enter back into the labor force, that is one of the biggest numbers we've seen in years real good sign there. we have over 400,000 additional workers when you look at that survey. so the reason unemployment did tick up, is that more people are actually participating in the workforce. i think that is a really good sign. and we're probably going to see that if -- just with what we were talking about today people are seeing, less money in their savings less money in 401(k), inflation impacting them the job market is still very, very strong it is a tight labor market, there are tons of job openings 78 sectors across the board professional business services very strong retail, healthcare, lots of opportunities manufacturing, contradiction trade transportation coming back
people need to get back to work we need to see that number of 2.4% labor participation, we need to get that back to 64 and 65%. >> hi that is important to watch in the future. >> stephanie as we speak dow futures continue to rise higher, 213 points nasdaq was pointing lower earlier, during the show this morning now indicating open higher by 104 points, labor force participation point really, really important when it comes to how we look at these numbers the administration has been touting low unemployment rate 3 1/2% record historic lows but not a good indication of what is happening with so many people, back on the sidelines now you have people coming back and coming back to work a good thing but media probably, isn't going to really explain what is happening here that is what i think is so important for our viewers to understand, how do you get that labor force participation up higher when you still have these, as you said, stimulus checks coming
out? >> absolutely, well, i gus you have to have significant asset deflation to force people back in labor force fed doing pretty good damn job on that score i would underscore your point jackie soft laughable explanation from administration about low employment if everyone dropped out of labor fors would have zero percent -- >> i think this is what markets are honing in this morning why trading up on this number is that that almost 800,000 increase in labor force is a very favorable seen for powell, and company, because they really want to see this supply demand imbalance in the workforce start to normalize my concern that could happen a lagged indicator but when you look at all of the other economic indicators, the reaction to the fed tightening has been
swift, and profound no where more than interest sensitive sector autos housing, and i think that we may see ones of these kind of effects when it comes to the hit to corporate profits that eventually is going to really restrain the demand for labor, although right now people are still in that post-pandemic mode where just every employer they can get employee they can get hanging on too tight i think will cut hours before cutting heads, another shoe we did see one-tenth decline, maybe we will see hours worked, at the same time labor force expands powell can start to exhale. >> june down 239 correction on july down 107,000, your thought on the overly the broader tend we are seeing
with revisions worked in. equity market certainly, soed by bond market what we're seeing perhaps the expansion of payrolls was not the as great as previously estimated. would like to pay a lot of attention to that average hourly wage up by 3/10 of a percent, unexpected given the fact big difference between job, o openings 11 million, 6 million-employed would think with tight labor market would see acceleration of wage growth not taking place says there important because if we avoid a wage price spiral we are less likely to repeat that horrible period of persistently a relationship inflation typified 1970s and
1980s wages, second quarter this is incredible, we had a faster than nine percent year-over-year increase by unit labor covets or what it costs, in terms of wages to produce one unit of output the last time we had human labor cost rise faster than 9% would be 79, 80, that coincide with worst of inflationary epic in 70s early 80s. futures coming off highs we saw a little bit, still higher, you know indicating that wall street is going to have a strong day at least at the open kind of paring back a little bit todd i want to bring you in inflation wages steve made the point john made the point all of you made this point we need to see people's wages keep in line with inflation that we're experiencing 24 comes down to putting food on the table gas
in the tank that is hard to do with wages up only 5%, 5.2% year-over-year. >> keep in mind you don't necessarily get those wage increases unless starting a new job or transferring to a higher promotion within that job not like your employer is saying oh inflation is bad, here is some money that is, obviously, not how it works so that is why people are feeling squeezed, jackie if i would, again i want to stay in my lane i am not one of the macroeconomic experts on this panel i do have a question for steve, you look at this report, is there anything tang ineligible here that biden democrats are going day take on campaign traditional or is it too wonky at this point are numbers not large or small enough 206 any precipitous impact next month on the trail? >> well, i think kind of jobs market is good, so there will be some beating of the chest by biden to say look at
increase in employment there is really interesting thing going on john touched on this you are seeing wages rise you know a bit, about it you also have the other word we got to talk about is productivity, jackie the productivity numbers have been terrible, awful, so worse productivity we've seen wroeshg compensation is rising faster than productivity of works that gets to the problem john was talking about that you get a wage you know, plus inflation problem where higher wages are causing more inflation, so, we've got to bring the productivity levels up and biggest shoe this labor day weekend that you guys have been talking about fox business for last several days is a lot of employers like apple are saying hey workers you got to get back into the office -- that will be something -- >> you've got a lot of ceos out there saying enough is enough it is time to get back into the office.
steve that is -- i wanted to ask you how do we get those productivity numbers up this is really a result of what we've seen trends we've seen within because of the pandemic keeps going on and on if longer democrats keep extending length how long pandemic lasts, harder hits our economy right it is time to get back to work. >> yeah, i mean, quick to answer that first of all we need more capital investment, because that is what leads to more labor productivity also one of the reasons employers want people back in the office they are seeing they are seeing declining productivity of workers, staying at home. jackie: yeah. really true, pro belonged period of time lisa to you i didn't get your take your read on numbers as watching futures pare back a little bit more dow peaked around higher indicated opening 200 thousand 111. >> this really was a nice report jackie if you look at really where all the numbers
came in, we still have very solid jobs growth while again slowing, that is to be expected where we are, with the economy, where we are seeing a head fed tightening, decelerating globally, maintaining higher level of averages last self years not enough to potentially raise concern about wage price spiral the greet news on labor participation front that wl was part of where over the last few months we've actually seen that figure stagnate we have made progress over the months immediately preceding the -- our after the pandemic but then again, it is tapered off nice to see a jump back in that again and again that will also help, relieve potentially some inflation pressure again as workers come back into the workforce. jackie: joanie i want to come
back to you we talked about fed chair powell what strategy might be we understand backward-looking what do you think he is going to how do you think he is going to read this with respect to the rate hikes we know where he stood last friday. so having said that. >> you know, the fed always focuses in on wages, labor participation. and so i do think they will read this as a very good sign that more people are actually entering back into the labor force. not only that we are seeing job growth remains strong and job openings out there but labor participation has been important. the productivity issue is actually more of my concern. when we look at overall labor workforce, people have kind of given up we've talked a lot about quiet quitting the last few weeks, you know are people
just saying they just want to do bear minimum not going above and beyond, but employees have been in the drivers seat we are starting to see scales kind of tip employers are going to be in driver's seat they are going to be requiring more from their employees they are looking for them to get back to the office, they are looking to drive productivity. they want the to retain employees, but recessionary worries tightening pierce springs more conservative with hiring doing recession planning not you know not seeing big layoffs but could to see some layoffs this is a really interesting time right now, i think we are going to start to see a shift, to this being more of an employer market, the job market will still be strong, i think going to see people coming back to work, with inflation on the rise. jackie: i think you are making very important point.
i think fed will read this as a good report. jackie: steve to you on this take out crystal ball scoman on what joanie's point was employers will start to regain control people will start coming back to the workforce at the same time we do expect the fed to still try to tamp down inflation, when he jerome powell raids cost of borrowing, does that lead to more layoffs? >> let me address the fed issue there, i mean do i think jerome powell was pretty concrete what he was saying he was saying we have one job right now at the fed i think right about that that job is to bring inflation down from the 7 to 8% range in right now back to 2% target a long way to go you've got -- so -- we are starting to see look i am look commodity next fallen
dollar responding o imports strong sounds resolved to keeping track that have target bringing inflation rate down every month exactly what they should do i don't buy the argument strong jobs' report means more inflation i never bought that argument a good jobs' report is a good jobs' report especially economy. >> stephanie weigh in. >> i agree, with steve one hundred percent i think you know the fed really is between a rock and a hard place, because they've got to quash in inflation, and meanwhile, being forced to offset stimulus at fiscal level all the time, yet powell seems content to he navigate this situation. but, you know, i really think that -- what we're underestimateing in general the markets are underestimating is impact to
the rate increases we've seen already, we are just waiting to see that travel through the pipeline, again, i hate to keep going back to housing but because it is the first area to feel the pain it is a really good window into what we can expect over the next few months i mean you've seen 40, 50% declines new existing home sales from the peak the peak was not even a year ago so those are stunning declines, in activity, and i think you are going to see that across the economy then especially, in corporate profits coming back to employment the number one input into hiring, so, i confess we do have an anomalous employment situation because of the covid experience employers want to hang-to anyone they can get but i think this hiring frenzy is going to slow dramatically as earnings come under real pressure going forward. jackie: i think a great
point. >> just lost the show -- that is a great point john lonski follow up on that one of the issues that becomes problematic, corporate earnings start to drop if we hear from companies that they are having trouble, as a result of all these different dynamics that are playing out, thin, is when you start to see the slowdown that we talked about in earnest. >> especially true, when you have labor costs rising quickly, while productivity is declining, that cuts into profit margins some point, payrolls all but stalled, in not too distant future regarding what stephanie was talking about this teendz tribe a lagging indicator right now we have a housing recession home heales way down from peak down more than 20% year-over-year, yet what did we have? in the month of august? we had increase by construction employment
believe me that increase by construction employment is not a sign of things to come, i hate to say this i think the housing recession is a sign of things to come, and as the economy stalls maybe goes into reverse, we are going to quickly see the am presidential gained by payrolls giveaway to outright loss of jobs. jackie: i think that is really got a point also, and look at dynamics together to sort of read overall picture, todd i want to come to you talking a lot about not just this report per se but economy in general how it impacts voters as they make decisions when they go to midterm elections, the administration really tries to spin all reports, tries to spin what is going on a the economy the bottom line is they spent over four trillion dollars contributed to this place, in the last 19 months. >> that bothers the voter it doesn't bother the voter that is in the ivory tower spent a
gazillion dollars on education a degree pays whooping 20,000 dollars a year but matters to the individuals who paid back loans to individual didn't go to college have to pay this back when you think the economy, i understand what steven is saying hey that is chest thumb per somewhat for administration this is something american people wanted in light of what you said the fact we are four trillion dollars more, in the hole than we were, than before, if interject, macro xhiebz not my game it common person stuck in this market thus far in roller coaster redicallowsness i am looking toing when value stocks pay off is there anything in today's report in dynamics of today's report the discussion we've seen should have gone that worry me as a common man
that those numbers dividends in november december aren't as high as banking on ie the reason i stuck it out so he far. >> well -- i guess i would just say hard to avert the earnings recession pipeline right now we've had an extended period where input costs were outpacing the ability to pass on for average corporation, so i think that is going to start to winnow, its way through, you know last year we had 50% earnings growth this year decelerateing to 8% according to consensus estimates i think we are frankly lucky to hit that the real question 2023, and for all the reasons i just highlighted, and john lonski underscored i think, we should expect a dramatic deceleration in activity across the board as presageed by housing i think earnings numbers are going to actually go negative we will have a recession, so,
i guess my advice to you todd would be might be keep powder dry might be better opportunities in 2023. >> i got a little time on my side joking aside worry about my dad who don't have that runway. >> let me ask you we've had recent spending a aggregate number, 739 forgiveness student loans more spending stimulus as well when does that impact that hasn't circulated through the economy just signed in inflation instruction act higher on inflation than right now. >> being gentlemane great point i think the single biggest for the economy clearly, clearly, clearly, trillion-dollar spending no
question match lit bond fire in the first place no slowing down, of this, just last six months, the congress added another trillion to trillion 1/2 dollars, by the way, people should know that is -- 6 on top of 6 trillion dollar budget excess spending fed trying to bring inflation rate down, raising interest rates, congress is making it worse continuing to spend single most important policy objective as a country we should have is dramatically cutting government spending. >> i want to make point when it comes to biden administration making this claim that you know look how much all this spending we've reduced the deficit, well the deficit, three trillion-dollar high as a result of all of this pandemic spending first year, if he would have done nothing, a trillion dollars would have been lopped off, so he reduction of 350 was much
smaller than what could have happened because the administration continued to spend, john i saw you nodding before i know you wanted to get in on the conversation. >> you are touching upon important point, that is that you cannot necessarily permanently raise standard of living through fiscal stimulus alone or monetary stimulus all about administration did, was takeaway from future growth, it brought future growth to the present at cost of slower growth going forward, i want to add one more thing earnings he front, what really fright eps me about a lot of second-quarter earnings reports, is the number of companies that are able to realize increases in profitability only because they were able to raise prices by enough, to off as the a drop in sales or sales
voluntarily inconsistency nonnonrecurring has to end some point when it ends, it ends badly. jackie: i think a great point todd jump in. >> i was worried about prices so high my position position mot mike pro-you think companies have all money sitting on cash that is going to come to the stock he holders in dividend boost up 401(k) last couple months of the year based on what you said i am a lot more worried about that forward should i've gotten out well going was good in march, february this year >> we say don't look at 401(k) only a little time quick answer appreciated, but if you did look to a 401(k) since jerome powell spoke hasn't >> yeah, i wouldn't be selling my stocks right now, but i sure wouldn't be buying them either. i think we are in for some rough a patches, can and it's all a
result of -- remember, that spending you were just talking about, that hasn't even hit the economy yet. that's going to definitely be inflationary. jackie: i want to thank all of you for joining us, stephanie, job first lisa, steve, todd, my wing mafnlt of course, big number out morning, futures indicated higher by 188,000, but we're going hand it over to "varney & company". ashley weber, take it over or for us. ashley: good morning everybody. i'm ashley webster in for stuart varney on this friday p. okay. we now know the august jobs report coming in at 315,000. the unemployment rate ticking up a little to 3.7%. labor participation rate up a hair at 62.4%. let's take a look at reaction from stocks. well, somewhat neutral report, and i think that's given some relief to investors in the premarket. the dow can up 176, th