Wall Street Journal

How America Works

The February jobs report was a mixed bag. Let’s get the bad news out of the way: the economy added only 20,000 positions, the smallest gain since September 2017. The number was much lower than last year’s average monthly amount of 223,000 and far below expectations for 190,000. 

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What explains the drop? There is no single answer, but here to help us break it down is Chip Cutter, a reporter at the Wall Street Journal who recently worked on a story called, How America Works: Inside the Hottest Job Market in Half a Century. 

Some possible culprits include a statistical anomaly, exaggerated by seasonal oddities that are unlikely to persist; spooked employers, who sat on their hands as growth slowed in the beginning of the year amid the government shutdown; bad weather, which hurt construction and maybe just a weird one-off, much in the same way that the huge January number may have also been an outlier. In fact, if we take the first two months of the year, job creation averaged about 165,000, an amount that would be consistent with a slowing economy in Q1.

However, there was also good news. Average hourly earnings increased by 3.4 percent from a year ago, the best annual gain in almost a decade (April 2009). Additionally, the headline unemployment rate returned to 3.8 percent, which is where it was before the government shutdown. 

Finally, the broad measure of unemployment (aka “U-6”, which includes unemployed; discouraged and marginally attached workers; and those who are working part-time, but seek full time) declined to 7.3 percent from 8.1 percent, its lowest point since December 2000. These numbers seem to indicate that the labor market may be slowing this year, but it is still relatively tight and healthy.

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Real Estate + The Financial Crisis Ten Years Later

Saving for retirement while also trying to save for a house downpayment. That’s the dilemma facing Erin from Salt Lake City as we kicked off the latest radio show. Is there a happy medium? Or should she focus all her efforts on getting that downpayment in place?

Next up was Joe from Chicago with another real estate question. This one involves finding a way to keep an piece of existing property in the family.

Where has the time gone? It was ten years ago this month that the U.S. financial system was brought to its knees.

To help us retrace the events of that period, we’re joined today by Gretchen Morgenson, investigative reporter at the Wall Street Journal.

As the financial crisis was unfolding, Morgenson was working for the New York Times, and subsequently co-authored Reckless Endangerment: How Outsized Ambition, Greed, and Corruption Led to Economic Armageddon.

There’s no one more qualified to walk us down memory lane and remind us of just how bad things actually were. In case you’ve forgotten, consider this timeline:

  • 9/15/2008: Lehman Brothers files for Chapter 11 bankruptcy protection. On the same day, Bank of America announced its intent to purchase Merrill Lynch for $50 billion.

  • 9/16/2008: The Federal Reserve Board authorized the Federal Reserve Bank of New York to lend up to $85 billion to AIG under Section 13(3) of the Federal Reserve Act.

  • 9/16/2008: The net asset value of shares in the Reserve Primary Money Fund fell below $1 per share, primarily due to losses on Lehman Brothers commercial paper and medium-term notes. When the Reserve fund “broke the buck,” it caused panic among investors who considered money market accounts nearly the equivalent of bank savings accounts.

  • 9/19/2008: To guard against a run on money market funds, the Treasury Department announced that it would insure up to $50 billion in money-market fund investments at companies that paid a fee to participate in the program. The year long initiative guaranteed that the funds' values would not fall below the $1 a share.

  • 9/20/2008: The Treasury Department submitted draft legislation to Congress for authority to purchase troubled assets (the first version of TARP).

  • 9/21/2008: The Federal Reserve Board approved applications of investment banking companies Goldman Sachs and Morgan Stanley to become bank holding companies.

All this in just one week!! An incredible moment in the history of this country, and it was only ten years ago.

Have a money question? Email me here.

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"Jill on Money" theme music is by Joel Goodman, www.joelgoodman.com.

The Financial Crisis Ten Years Later

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Where has the time gone? It was ten years ago this week that the U.S. financial system was brought to its knees.

To help us retrace the events of that period, we’re joined today by Gretchen Morgenson, investigative reporter at the Wall Street Journal.

As the financial crisis was unfolding, Morgenson was working for the New York Times, and subsequently co-authored Reckless Endangerment: How Outsized Ambition, Greed, and Corruption Led to Economic Armageddon.

There’s no one more qualified to walk us down memory lane and remind us of just how bad things actually were. In case you’ve forgotten, consider this timeline:

  • 9/15/2008: Lehman Brothers files for Chapter 11 bankruptcy protection. On the same day, Bank of America announced its intent to purchase Merrill Lynch for $50 billion.
  • 9/16/2008: The Federal Reserve Board authorized the Federal Reserve Bank of New York to lend up to $85 billion to AIG under Section 13(3) of the Federal Reserve Act.
  • 9/16/2008: The net asset value of shares in the Reserve Primary Money Fund fell below $1 per share, primarily due to losses on Lehman Brothers commercial paper and medium-term notes. When the Reserve fund “broke the buck,” it caused panic among investors who considered money market accounts nearly the equivalent of bank savings accounts.
  • 9/19/2008: To guard against a run on money market funds, the Treasury Department announced that it would insure up to $50 billion in money-market fund investments at companies that paid a fee to participate in the program. The year long initiative guaranteed that the funds' values would not fall below the $1 a share.
  • 9/20/2008: The Treasury Department submitted draft legislation to Congress for authority to purchase troubled assets (the first version of TARP).
  • 9/21/2008: The Federal Reserve Board approved applications of investment banking companies Goldman Sachs and Morgan Stanley to become bank holding companies.

All this in just one week!! An incredible moment in the history of this country, and it was only ten years ago.

“Better Off” is sponsored by Betterment.

Have a money question? Email us here or call 855-411-JILL.

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Connect with me at these places for all my content:

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https://www.linkedin.com/in/jillonmoney/ 

http://www.stitcher.com/podcast/jill-... 

https://apple.co/2pmVi50