November 6

11/6 – The U.S. economy has shown resilience, supported by a strong job market and a jump in “experience” spending (travel, concerts, restaurants) by younger Americans. But if the economy takes a turn for the worse in 2024, we may look back on Friday’s Labor Dept. report as a turning point. U.S. employers added 150,000 net new jobs in Oct, less than half Sept’s level. The unemployment rate rose from 3.8% to 3.9%. It’s important because, despite deteriorating consumer finances, it is still nearly impossible to have a recession in a full employment economy. If the slowdown in hiring becomes a trend, that would increase the odds for recession in 2024. The time to start worrying is when unemployment gets to 4.5%. If it hits 5.0%, we are likely already in a recession. So far, the consensus of 72 economists surveyed by the Wall Street Journal projects end-of-year 2024 unemployment at relatively safe 4.4%.