Bill Gross on economic conditions

Bill Gross said in his January investment outlook that the US economic environment is showing momentum. Gross also said that the US economy will see more investment during Trump’s presidency. He believes companies will see capital investment that will help them to increase their capacity, and thus their productivity. Higher productivity is necessary for stronger economic growth (SPX-INDEX) (SPY) (VOO).

Why Bill Gross Is Skeptical about US Economic Growth

In an interview with Bloomberg Television on February 3, 2017, Gross said that he is skeptical about real US economic (QQQ) (IVV) growth and whether or not it could rise to 3%–4% in upcoming years. The Trump administration has promised higher fiscal stimulus, lower corporate taxes, and deregulation. These steps will help the economy regain its strength.

Labor market and wage growth

According to Gross, the labor market and productivity are highly necessary for real economic growth. Productivity is a major driver for US economic growth in the present scenario. However, he is a little worried about wage growth. The US labor market showed a huge improvement in January 2017. Non-farm payroll employment in the United States (SPY) (SPXL) saw an increase of 227,000 jobs in January compared to 157,000 jobs in December. The January figure beat market expectations of 175,000 jobs.

Wage growth was revised down by 0.2% in January 2017. The declining wage growth is a major concern for Bill Gross. Lower wage growth indicates that there is less money in consumers’ hands, which will impact consumer spending. Consumer spending is important for US GDP.

In the next part of this series, we’ll analyze Bill Gross’s view on central banks’ QE programs.

Latest articles

Broadcom (AVGO) stock fell ~8.5% after markets closed yesterday following the semiconductor giant's fiscal 2019 second-quarter earnings release. It missed analysts' revenue estimate and cut its fiscal 2019 revenue guidance by $2 billion to $22.5 billion due to sluggishness in its semiconductor solutions business.

The SPDR Gold Shares ETF (GLD), which tracks physical gold prices, has underperformed the broader markets year-to-date, rising just 4.4% compared to the S&P 500’s (SPY) gain of 15.9% as of June 14. The sentiment for gold, however, has been turning around.

Safe havens such as Treasuries and gold were back in favor on June 14 as stocks fell due to rising tensions in the Middle East, concerns over growth, and the looming threat of the US-China trade war. The tech-heavy Nasdaq Composite Index fell 0.67% in the first hour of trading.

Lululemon (LULU) stock rose 2.1% on June 13 in reaction to better-than-expected first-quarter results and an upgraded outlook for fiscal 2019 overall. The company's first-quarter adjusted EPS grew 34.5% to $0.74 on revenue growth of 20.4% to $782.32 million. Analysts had expected EPS of $0.70 and revenue of $755.31 million. Here's why the outlook got an upgrade.

14 Jun

IEA Again Slashes Its Oil Demand Growth Estimate

WRITTEN BY Rabindra Samanta

As of 4:40 AM Eastern Time today, US crude oil active futures were at $51.83, ~4% below their closing level in the previous week. If US crude oil prices stay at those levels today, they'll mark their third week of decline in five weeks.

Amazon is discontinuing its Amazon Restaurants service, which has been delivering food for restaurants in parts of the United States. Amazon Restaurants launched in the United States in 2015 and entered the British market the following year. However, it met strong opposition in the British market.

172.31.16.229