In stark contrast to the celebratory "AMERICAN ECONOMY BOUNCES BACK FROM BRUTAL WINTER" headline Friday afternoon at the Associated Press, aka the Administration's Press, Ben White's "Morning Money" report at the Politico is notably concerned about whether Friday's "vexing jobs report" justifies the kind of optimism the AP conveyed with seeming finality in its headline.
To be fair, the underlying AP report by Chris Rugaber and Josh Boak pointed to several weaknesses in the jobs report. But to be appropriately critical, as I noted yesterday, they took it as a virtual given that the economy will turn in full-year growth of "nearly 3 percent." Achieving that result will require second-half annualized growth of nearly 4 percent — a level would likely cause the Federal Reserve to put on the brakes by raising interest rates to stave off inflation. In a separate post, I also criticized the AP pair for presenting economists's estimates of 3.5 percent annualized growth in the second quarter without telling readers that their prediction is premised on the first quarter's current 0.1 percent result getting revised downward into contraction.
White's brief report at the insufferably pro-Obama, pro-Hillary, leftist Politico is unusually balanced, and even went after the New York Times's dueling headlines which were just two days apart (NYT links added by me; bolds are mine):
ECONOMY SET TO POP OR DROP? — Friday brought another somewhat vexing jobs report. The headline 288K number was strong. But how much was catch-up from the brutal winter? And the household survey actually showed an unadjusted net LOSS of jobs in April and a decline in the labor force of close to 1 million. But the household survey is crazy volatile month-to-month. So throw that out right? But what about that dismal 0.1 percent first quarter GDP report? Sure, it’s backward-looking ...
But how exactly do we get from there to the 3 percent-plus growth that so many economists are banking on to drive bigger job gains the rest of the year? The housing market isn’t going to do it. And incomes are not yet rising, meaning consumer spending is unlikely to be a big driver. What else do we have to hope for? Basically that a pop in take-home pay is just around the corner and that small business spending will crank up. But those things seem less like certainties and more like hopes.
... THE ECONOMY SUMMED UP IN TWO HEADLINES —
NYT, May 1: “Once More, Economy Exhibits Weakness.”
NYT, May 3: “Jump in Payrolls is Seen as a Sign of New Optimism."
A Politico reporter's skepticism about how genuine the prospects for decent economic growth are is a clear signal that it's more than okay to be worried.
Cross-posted at BizzyBlog.com.