Drudge Retort: The Other Side of the News
Tuesday, July 17, 2018

The U.S. economy is running at a fast enough pace to justify continued interest rate increases, Federal Reserve Chairman Jerome Powell said Tuesday. Powell is delivering his semiannual testimony to Congress this week, starting with an appearance Tuesday before the Senate Committee on Banking, Housing and Urban Affairs. In remarks he provided ahead of a question-and-answer session, Powell painted a largely positive picture of the economy, which he said is expanding at an increasing pace and is being boosted by aggressive fiscal policy on Capitol Hill.

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"Overall, we see the risk of the economy unexpectedly weakening as roughly balanced with the possibility of the economy growing faster than we currently anticipate," Powell said.

"The unemployment rate is low and expected to fall further. Americans who want jobs have a good chance of finding them," he added.

Though the economy grew at just a 2 percent pace in the first quarter, Powell said growth in the second quarter was "considerably stronger than the first."

"Robust job gains, rising after-tax incomes, and optimism among households have lifted consumer spending in recent months. Investment by businesses has continued to grow at a healthy rate," he said. "Good economic performance in other countries has supported U.S. exports and manufacturing. And while housing construction has not increased this year, it is up noticeably from where it stood a few years ago."

Inflation is running around the Fed's 2 percent target for the first time in several years, while the unemployment rate is at 4 percent and consistent with a level that most economists consider near to full employment. Powell said wages are growing faster than a year ago but not enough to stoke inflation fears.

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I didn't read the link, but I do have one legitimate question ...

Are workers wages rising at the same rate as the economy?

If the answer is "no", then who cares because all this means wealth inequality continues to rise ... and it also means we're heading toward either a police state or an uprising.

#1 | Posted by PinchALoaf at 2018-07-17 02:40 PM | Reply

@1

Wage growth tends to lag behind employment numbers but then continues to grow as employement growth stagnates. As Powell notes, wages are rising but not so fast as to "stoke inflation fears", which for the Fed means over 2%.

As for the police state/uprising, I will agree to disagree.

#2 | Posted by Rightocenter at 2018-07-17 02:51 PM | Reply

Food prices are skyrocketing.

#3 | Posted by fresno500 at 2018-07-17 04:07 PM | Reply

So the economy is hyped up like a diabetic on a twinkie binge thanks to the GOP tax giveaway to the 1%.

Real wages are falling because of inflation caused by it.

So much winning!

#4 | Posted by Nixon at 2018-07-18 08:01 AM | Reply

Wage growth tends to lag behind employment

It's been lagging for 8 years now.

wages are rising but not so fast as to "stoke inflation fears", which for the Fed means over 2%.

Current inflation is 2.87%.

*womp*womp*

inflationdata.com

www.usinflationcalculator.com

Current US Inflation Rates: 2008-2018
The current inflation rate for the United States is 2.9% for the 12 months ended June 2018, as published on July 12, 2018 by the U.S. Labor Department.

#5 | Posted by Nixon at 2018-07-18 08:06 AM | Reply

According to the Fed (which is the only data that matters for the purposes of Pinche's question), in June 2018 it was 2.07%, which is their target rate on their 5 year Breakeven Inflation Rate. Since their five year period previously was consistently under 2%, the Fed isn't currently concerned.

Fred: Five year Inflation Breakeven Rate

Womp Womp indeed.

#6 | Posted by Rightocenter at 2018-07-18 02:06 PM | Reply

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