Speaker 1: Bloomberg Audio Studios, Podcasts, radio news.
Speaker 2: Single, best Idea.
Speaker 3: What a week.
Speaker 2: The highlight was the last thing we did. We went
Speaker 2: to New Orleans and Vanessa Perdomo, on site for Bloomberg
Speaker 2: in Radio Row, interviewed Joe Montana. She's like lights out,
Speaker 2: it's her sixth super Bowl. I looked around our studios
Speaker 2: and I said, let's count super bowls. Sweeneyo went to
Speaker 2: one a million years ago. I brought up Max McGhee
Speaker 2: and super Bowl one. Thank you, Vanessa Perdomo for joining
Speaker 2: us at your sixth super Bowl in New Orleans. We
Speaker 2: had a super Bowl today. We do it twelve times
Speaker 2: a year. Job's day. What a set of guests, Claudia
Speaker 2: Sam thank you so much for spear heading all of
Speaker 2: our coverage. But right for the beginning with Jim Bianco
Speaker 2: and Priam Misra, just a wonderful, wonderful set of conversations
Speaker 2: onikon finance, investment, in a little bit of international relations.
Speaker 2: Today Allen Zenner joined us and we talked to Ellen
Speaker 2: Zenner about this labor economy, but something new, the stock
Speaker 2: market up, the wealth effect.
Speaker 1: We have created a tremendous amount of wealth and so
Speaker 1: one are we spending the same amount out of that
Speaker 1: wealth that we normally do. It's just wealth. Is that high?
Speaker 1: That is one possibility? Or is the still some lingering
Speaker 1: effects of COVID which taught us we're all going to
Speaker 1: die tomorrow and so spend it if you got it?
Speaker 2: Interesting?
Speaker 1: So is it that the marginal propensit to consume? That's
Speaker 1: a great economist term, tom You like that marginal propense
Speaker 1: to consume out of wealth may just be higher. And
Speaker 1: so does that fade the further we get away from
Speaker 1: COVID further it's in the rear view mirror or does
Speaker 1: it just stay that high because now we've had some
Speaker 1: structural shift.
Speaker 2: We've seen research on this. I mean, you're in a
Speaker 2: casperg seat to see research.
Speaker 1: Over we have done this research.
Speaker 2: Do you see to me it's an unspoken huge deal.
Speaker 2: Am I wrong?
Speaker 1: Yeah? So what I see, what I believe I see
Speaker 1: in the numbers is that it's just the amount of
Speaker 1: wealth that has been created has just been that large.
Speaker 1: I think that we're seeing, we're in the midst of
Speaker 1: seeing the data is quite lagged on this, that the
Speaker 1: marginal propensity to consume out of wealth is returning back
Speaker 1: to normal but that the wealth we've created is just
Speaker 1: that high.
Speaker 2: That was brilliant cardinal rule. When there's an algebraic function
Speaker 2: and one of the coefficients has three letters MPC, just
Speaker 2: move on to the next page. That's my rule on
Speaker 2: economic algebra. That was brilliant Ellen Zenner there on the
Speaker 2: marginal propensity to consume and the idea of the wealth effect.
Speaker 2: I think this is going to be a huge story
Speaker 2: into twenty twenty five if this bull market continues. We've
Speaker 2: talked to Anna Wong. Without question the leading market economists
Speaker 2: around the world, huge influence on job labor economics, if
Speaker 2: you will. An along of Bloomberg Economics today and the
Speaker 2: key revision statistics.
Speaker 3: Yes, I was quite surprised that the by how small
Speaker 3: they are. So in the benchmark period that covers April
Speaker 3: twenty twenty three to March of twenty twenty four, we
Speaker 3: only saw five hundred and eighty nine thousand downward revision.
Speaker 3: We had expected closer to seven hundred thousand, and I
Speaker 3: think part of it is because I think that BLS
Speaker 3: still has not entirely updated the birth and death projection.
Speaker 3: So in the second half of twenty twenty four, we
Speaker 3: had expected about two hundred thousandward revisions, but instead of
Speaker 3: a total downward revision, we actually see a cumulative positive revision,
Speaker 3: all of which almost came from December of last year.
Speaker 3: So I think my bottom line is that number one
Speaker 3: BLS has not come played the updates on lowering the
Speaker 3: birth and death productions. And second, there is a real
Speaker 3: improvement towards the end of last year, particularly in December,
Speaker 3: in terms of job growth. And I think it's possible
Speaker 3: that the labor market is in a mist of stabilizing right.
Speaker 2: Now and one of Bloomberg economics, and once again the
Speaker 2: market looks forward and tries to anticipate with the market's
Speaker 2: wonderful bid and ask sensibility, and maybe a constructive January
Speaker 2: had something to do with that healing labor market that
Speaker 2: doctor Wang talked about chiefs or eagles. I don't really
Speaker 2: have a strong opinion. I mean, I think everyone knows.
Speaker 2: I'm not expert in any way, shape or form. But
Speaker 2: we thank Vanessa down in New Orleans for help today
Speaker 2: on the commute across America. Thank you for being with
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