Economy Growing, Regulations Shrinking
Jobs Number Shows Economy Growing
Last week, we had a great jobs number which was good to see as the week before we saw a weak GDP number. The services sector, in particular, which makes up 80% of our GDP, was a strong number.
This jobs number is even more important than most because of the very weak GDP and jobs number we had in the first quarter. This is the first look as to how things are going with the economy and what we can expect in the second quarter, especially from a business standpoint. You have more people hiring and more people moving from part time to full time. And then, at the end of this week, the second most important data point will be released, retail sales which comes out on Friday.
Last week we saw that businesses were hiring. So was the poor GDP we saw in the first quarter an anomaly? Based on what businesses are doing, it seems as if it was a one off quarter. With the retail number on Friday, we will see if, now that people are getting jobs, they are spending money.
Dodd Frank Regulations Shrinking
Washington, D.C. was also very busy last week. Of course, we saw the high profile issue of health care but, as well, the House voted to roll back a good bit of Dodd Frank. Remember, Dodd Frank is the set of regulations that came out after the financial crisis and which focused primarily on banks. If we get Dodd Frank rolled back we get a direct and indirect impact on jobs. Direct because if banks don’t have to keep as much capital on their books they can hire more people. Indirect, as well, because if they don’t have to keep as much capital, they can loan out more to owner managed businesses. It would be a great economic push both ways if we could get this rolled back. We will be watching to see what happens as lower regulation means a better business environment.
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