U.S. jobless claims climb to 230,000 in sign labor market may be slowly cooling off

Unemployment has been showing signs that the labor market may be slowing down and people are not hiring at the rate that they were two months ago. The unemployment has reached about 230,000 which is a 4,000 person increase from last week. All states but Tennessee have reported an increase in jobless claims since last week. With the Fed looking to steer the economy from a  recession the biggest issue is how much is the Fed willing to increase the inflation rate.

The increase in jobless claims has not only affected the labor market but is making an impact on the manufacturing market due to factories not being able to keep up with demand for products causing a shortage in supplies across the country. The country is experiencing its fastest wage growth in nearly 50 years, with this wage growth and the amount of jobless people climbing more pressure has been added on the Fed to cool down prices. 

Reading this article and comparing it to other ones that have been published recently a recession looks to be happening soon.

https://www.marketwatch.com/story/u-s-jobless-claims-climb-to-230-000-in-sign-labor-market-is-slowly-cooling-off-11670506623?mod=economy-politics

Big cities drive half of global economic growth

While living in the United States many of us have grown up seeing economic progress throughout our lifetimes. However, what may seem logical is that metropolitan cities have developed at a faster rate than elsewhere. Recent data has shown that this trend holds for world economic growth. Research from McKinsey Global Institute pointed out that over half of the world’s economic growth in the past two decades has been comprised of less than 1% of the world's landmass. Big cities in China, India, the United States, and Europe have grown tremendously in size and with that have continued to quickly develop over time. This has meant that 27% of the global population has lived in regions that drove half of the world’s global growth in 2019.

Through taking the Human Impacts on the Environment course at OWU this year I have learned a little about how big cities have affected the world’s landscape. I think that throughout the next few decades it will be interesting to see how the trend of growing cities behaves, and what solutions will be made toward making that growth sustainable.

A second worry that comes with economic growth stemming from cities is that the quality of living will improve disproportionately, and serious poverty concerns will continue in certain areas of the world. With only a quarter of the world experiencing half of the world's total economic growth.

https://www.ft.com/content/24dbcc0f-7974-48d7-9824-ab86b58a3a29

Gas Prices Falling... But business cycles exist, so when will prices rise again?

 

    The United States has seen a decline in oil and gas prices in the last month. As consumers ease into lower gas prices, there seems to be a disconnect between the good news and the reason why gas prices have fallen. 

    Specifically the United States has seen the decline in prices because of change in supply, and a possible future change in demand. The supply of oil has greatly increase in the last month. Supply lines have unkinked, unleashing more oil than we have seen since Russia has been at war with Ukraine. The worlds oil rigs have also been back in full-swing, in fact there are 3 times as many oil rigs in function since 2020. Additionally G-7's price caps based on Russia's oil has not changed prices as dramatically for consumers as feared. 

    However, where can demand change in the future? As speculations of a recession pop up, analysts wonder if demand for the new efficiency for oil will decreases as the mindset about the market falls. Mindsets seem to be weary about the future of the economy, the amount of gas consumed at this time of years is lower than usual. The question for the future of gas prices lays within the outlook on the future of the economy. 

Will economic outlook, and demand beat out supply?

gas-prices-falling-biden-recession

Why We Think We're in a Recession and the Data Says Otherwise

     It's been the talk of the town recently that a recession is coming and warnings are being sent out to batten down the hatches, but data says otherwise. GDP grew in Q3, wages are up, people are spending, and the job market is stable. All of these factors are signs of a healthy economy without a thought of an upcoming recession. So why is everyone worried that the economy will go south?

    The biggest impact on the talk of recession is because the stock market is suffering. S&P 500 has dropped 18% in 2022 and the US economy isn't used to seeing a large negative change like this. The news picks this up and analyzes it as a negative effect on the economy as a whole, but in fact the economy is holding strong through the turmoil in the markets. It also doesn't help that the CEO's of these large investment firms are predicting recessions because of rising interest rates. 

    If the media and CEO's are foreseeing a recession, then the public will act according to their word and the recession is bound to happen. But, if the economy continues to refuse to show signs of decline, the murmur of a recession will subside and the economy will go back to normal. There are also some other investment firms that believe that their competition are overreacting to the alarm bells. They predict a small fall and a large bounce back. The past 6 months has been riddled with recession talk, but it looks like one might not even come at all.

https://www.cnn.com/2022/12/08/investing/premarket-stocks-trading/index.html

US job market cools as unemployment aid edges higher

 The number of Americans on unemployment aid has increased to the highest level since February. This suggests that more people are struggling to find jobs as the employment market cools down. The amount increased to 1.67 million in the last week of November. The report showed that the highest claims came from California, New York, Texas, Pennsylvania and Illinois. Companies have continued to cut jobs in preparation of an economic slowdown, Adobe cut 100 jobs this last Wednesday and fintech company Plaid cut its workforce by 20%. The applications for unemployment aid were 230,000 in the week to December 3, which is slightly higher than the previous week which stood at 226,000. We can expect this number to only increase in the future as the employment market cools down furtherer. 

Source: Financial Times

Goldman Sachs predicts 4 themes that will steer the global economy through 2075

 After watching the movie, the name Goldman was fresh in my head. Goldman Sachs used new data analysis systems and data from over 100 countries to predict the economy up to 50 years into the future. This might seem like a ridiculous feat due to all of the uncertainties, but it has been done. The first theme Goldman focuses on is that weaker population growth will lead to slower global economic growth. 

Their projections imply that global growth will average a little under 3% per year over the next ten years and will be on a gradually declining path, primarily reflecting slower labor force growth. They expect the population growth to fall close to zero by 2075.

The second theme is that some emerging markets become less relevant. Although real GDP growth has slowed in both developed and emerging economies, in relative terms emerging growth continues to outstrip developed growth. There is a possibility that the world’s five largest economies in 2050 (measured in real USD) will be China, the U.S., India, Indonesia, and Germany (with Indonesia displacing Brazil and Russia among the largest EMs), and by 2075, with the appropriate policies and institutions, Nigeria, Pakistan and Egypt could be among the world’s largest economies.

The next theme is that the US will take a step back. This is because growth in the US has slowed down significantly compared to other major nations, causing the value of the US dollar to lessen.

The last theme Goldman mentions is that wealth distribution stays in focus. This is basically just a call for the upcoming challenge in the future of globalization. 

Employment Remains Strong Despite Fed's Efforts to Raise Interest Rates

     It's pretty clear that the Fed is trying desperately to raise interest rates in order to curb inflation. From the number's we've seen, it's working. They're attempting to raise the interest rates to almost force rough times in order to slow inflation. Typically, this would mean that employment takes a hit and unemployment rises. However, new employment numbers show that employment has stayed strong. Employers added roughly 263,000 jobs in the month of November. This is a slight decrease from the 284,000 jobs added in October. The unemployment rate has stayed at 3.7% for the past few months, which is a good rate even in good times. With employment remaining strong, some believe that this will cause the Fed to increase their efforts to raise interest rates, something that many people do not want. However, the job market may look strong but it's not as strong as it looks. The market cannot stand strong for long with the high interest rates. It's only a matter of time before employment falters. This is all according to the plans of the Fed, who are trying to combat inflation by forcing some hard times.

    The increasing interest rates and inevitability of a weakened job market are scary from a consumer perspective. However, from an economic standpoint, I find comfort in knowing that is induced by the Fed. I know enough that I can understand it's necessary to enter good times quicker.

Source: https://www.nytimes.com/2022/12/02/business/economy/jobs-report-november.html

White house says they are keeping a close eye on twitter

 With apple stopping ads on twitter and threatening to withhold the app from the app store the White house has come out and said they are closly keeping an eye on twitter and how it may be a "vector of misinformation". The white house is keeping a close eye on twitter after Elon musk came out and promised to release information on the Hunter Biden scandal and information on the 2020 election. The white house has declined explination to why there is a federal investigation of Elon musks purchase of twiter and his promise to end censorship on the platform. People are curious to what they may have to hide as this is an unusual demand for an investigation. "theres a lot of ways" Biden says Elon may or may not be conducting things innaprropratly. This is something interesting as they don't have any specific reasons to look into him but since they are it is making people wonder what he may have that they don't want to be shared.