Speaker 1: Broadcasting live to New York Bloomberg eleven LEO through Washington,
Speaker 1: d C. Bloomber to Boston, Bloomberg twelve hundred to San
Speaker 1: Francisco Bloomberg nine to the countries, Joe is Exam General
Speaker 1: one nineteen and around the globe the Bloomberg Radio plus
Speaker 1: Dappen Bloomberg got gone. This is taking stock. An update
Speaker 1: on the Cleveland Cavaliers. Yes, they were defeated by the
Speaker 1: Golden State Warriors for the first game of the NBA Championship,
Speaker 1: but billionaire venture Capitas Gordon gunned. He is selling his
Speaker 1: fifteen percent stake in the Cleveland Cavaliers. This is, of course,
Speaker 1: their second year that they are playing for the NBA Championship.
Speaker 1: This all, according to two people familiar with the matter.
Speaker 1: Estimated value of the team one point one billion dollars
Speaker 1: that comes from valuations expert Peter Schwartz. Once again, the
Speaker 1: Cleveland Caliber Cavaliers fifteen percent stake of Gordon gund is
Speaker 1: up for sale. Hats off to our sports reporter Scott's
Speaker 1: Nick for a terrific story. Coming up now, Patrick O'Keefe
Speaker 1: on the latest jobs report. First to Charlie Pellet in
Speaker 1: the newsroom with a Bloomerck business flash, and I thank
Speaker 1: you very much, Kathleen, thank you, Pim. We are brought
Speaker 1: to you by the American Arbitration Association. Business disputes are inevitable,
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Speaker 1: in alternative dispute resolution for over eighty five years. Learn
Speaker 1: more than a d r dot Org. Oil explorers put
Speaker 1: drilling rigs back to work in US fields for only
Speaker 1: the second time this Year's supply and demand begin to
Speaker 1: come closer into balance. Baker Hughes says. Riggs targeting crude
Speaker 1: in the US rose by nine to three. Twenty five
Speaker 1: were dropped last week. Crude oil down today by one percent,
Speaker 1: falling forty eight cents of barrel West Texas Intermediate now
Speaker 1: at seventy. The dollar plunging the most since December against
Speaker 1: the euro after jobs growth trailed forecasts, weakening the case
Speaker 1: for the Federal Reserve to raise interest rates as early
Speaker 1: as this month. The US economy adding thirty eight thousand workers,
Speaker 1: unemployment down to four point seven percent. Here's US Labor
Speaker 1: Secretary Tom Perez, Well, this is below expectations, and one
Speaker 1: thing that I expected was that there would be impact
Speaker 1: from the Verizon strike. That's why I called him up
Speaker 1: two or three weeks ago and said, come to my office.
Speaker 1: We've got to resolve this because your workers and their
Speaker 1: families are suffering, the company suffering, and the economy suffering.
Speaker 1: So part of a big part of what we saw
Speaker 1: on this report was the impact of that strike. And
Speaker 1: gold today up two point six percent, surging thirty one
Speaker 1: ten the ounce to twelve forty three, seventy to thirty
Speaker 1: two on Wall Street. Now, let's take a look at
Speaker 1: other news from around the world. Charlie, Thank you. From
Speaker 1: the Bloomberg news Room by Mark Crompton. A search is
Speaker 1: still underway at ford Hood, Texas, for four soldiers who
Speaker 1: remained missing after their truck overturned Thursday in a rain
Speaker 1: swollen creek. Here's ford Hood spokesman Chris Howe. Accidents and
Speaker 1: isn't tragic The laws of unfolded One. Three others pulled
Speaker 1: from the water remain hospitalized in stable condition. Parts of
Speaker 1: Texas have been inundated with rain in the last week,
Speaker 1: and more than half of the state is under flood
Speaker 1: watches or warnings, including the county's near Fort Hood at
Speaker 1: least six people died in floods last week in central
Speaker 1: and southeast Texas. How Speaker Paul Ryan is announcing the
Speaker 1: launch of the House GOP election year agenda project. Titled
Speaker 1: a Better Way. It lists six proposals, including some to
Speaker 1: help lift Americans out of poverty. We can start to
Speaker 1: tackle our problems before they tackle us. This is what
Speaker 1: Americans do. We don't accept the client we don't give
Speaker 1: into division. We find a better way. Speaker Ryan may
Speaker 1: the announcement during the Republican's Weekly Address, which was released today,
Speaker 1: one day earlier than usual. New York City's top financial
Speaker 1: officer says the city's child welfare agency didn't properly monitor
Speaker 1: provide writers who were supervising troubled miners as part of
Speaker 1: a citywide juvenile justice program. Controller Scott Stringer says the
Speaker 1: city's Administration for Children Service quote abdicated its responsibility. He
Speaker 1: found in and audited that city workers sometimes skip visits
Speaker 1: to group homes and missed calls and visits to check
Speaker 1: on the children. Global News twenty four hours a day,
Speaker 1: powered by our hundred journalists and more than one hundred
Speaker 1: fifty news bureaus around the world from the Bloomberg Newsroom.
Speaker 1: I'm Mark Crumpton, Charlie, and we thank you and again
Speaker 1: recapping a move lawer for stocks. We are well off
Speaker 1: our session Low's SMP five hundred index down five at
Speaker 1: two thousand ninety nine, down three tenths of one percent.
Speaker 1: I'm Charlie Pallafat's of Bloomberg Business Flash. You're listening to
Speaker 1: Taking Stock with Bim Box and Kathleen Hayes on Bloomberg Radio. Now,
Speaker 1: Marry how slice it? It's hard to call today's May
Speaker 1: employment report from the US Labor Department anything but disappointing,
Speaker 1: if not week joining us now to dissect the report,
Speaker 1: what it means for the economy, and what it means
Speaker 1: for the Fed Reserve as it gets ready to meet
Speaker 1: on June fourteenth and debate whether or not to high
Speaker 1: rates again. Patrick o'cafe he is director of economic research
Speaker 1: at Cone Resnick. He's also a former Deputy Assistant Secretary
Speaker 1: at the Department of Labor. Patrick, welcome back to the show.
Speaker 1: It's great to be here. What is your take? Let
Speaker 1: me just sum up for our listeners yet again, only
Speaker 1: thirty eight net new jobs. Unemployment falling because so many
Speaker 1: people left the labor force wages pretty much flat. What
Speaker 1: does it tell you, Well, it was a report that
Speaker 1: made pessimists like myself. I was one of the low
Speaker 1: predictors on this one. Made the pessimists look like Pollyanna's
Speaker 1: And it just was totally unexpected. I know. The secretary
Speaker 1: pointed to the strike as being one of the reasons
Speaker 1: why jobs growth was down, but uh, this is the
Speaker 1: smallest increment of jobs since the jobs recovery began, uh
Speaker 1: seventy six months ago. Even if we UH discount the
Speaker 1: impact of this of the of the strike, we go
Speaker 1: from being the weakest in seventy six months to the
Speaker 1: sixth weakest since in seventy six months. It um, it
Speaker 1: was to be expected that there was deceleration in the
Speaker 1: labor market, particularly in the jobs part of it, going forward.
Speaker 1: This is a mature recovery, but these numbers were were
Speaker 1: far weaker than any of us anticipated. All right, Patrick,
Speaker 1: and wondering if you could explain, because when you, let's say,
Speaker 1: when you decide you want to have a softball team, right,
Speaker 1: and you pick all the best players you want to pick,
Speaker 1: you pick them usually the first is there anything to
Speaker 1: indicate that we are at the very end of the
Speaker 1: hiring cycle as a result of so many workers having
Speaker 1: already gone back to work. UM, there are still plenty
Speaker 1: of job seekers and potential job seekers. As Kathleen pointed out,
Speaker 1: the labor force participation dropped dramatically in this particular month.
Speaker 1: What we have to realize is that the five percent
Speaker 1: unemployment rate or the four point nine unemployment rate is
Speaker 1: drawn down because of people withdrawing from the labor force.
Speaker 1: So they don't disappear. They're out there, they're willing to work,
Speaker 1: they would look for work, but they're frustrated they haven't
Speaker 1: been able to find work. And so I don't think
Speaker 1: we have a shortage of labor. We may have some
Speaker 1: mismatches in terms of what the qualified qualifications for the
Speaker 1: jobs are and the qualifications of the employees seeking them,
Speaker 1: but overall this is UM is not a situation where
Speaker 1: we have inadequate supply. And in fact, if you look
Speaker 1: at the broader measure of unemployment, the underemployment rate is
Speaker 1: still up at nine point which does include of course
Speaker 1: people working part time because they can't find full time jobs, etcetera.
Speaker 1: Uh I was exchanging some emails with then Irana Cultural
Speaker 1: Lacoda this morning in earlier this afternoon, who is a
Speaker 1: former president at the Minneapolis FED, and of course he
Speaker 1: has been also uh, certainly barish on the notion that
Speaker 1: the FED should be raising rates. If anything, he thinks
Speaker 1: they might have to contemplate negative rates. He said, of
Speaker 1: course that what's more troubling to him. He said, you know,
Speaker 1: if you look at the household employment figures, the survey
Speaker 1: of people actually who have jobs or don't have them. Patrick, Uh,
Speaker 1: maybe the report wasn't so bad, but his concern is
Speaker 1: that inflation remains far from the Fed's target, and inflation
Speaker 1: expectations remain so low, and they aren't rising. And one
Speaker 1: of the reasons why they're not rising is because the
Speaker 1: FED continues to rely on the definition of an unemployment
Speaker 1: rate that doesn't acknowledge the substantial drop that we've had
Speaker 1: in labor force participation. We play around with something called
Speaker 1: the participation adjusted to unemployment rate, where we go back
Speaker 1: and we say, if not for the drop in participation,
Speaker 1: where would the unemployment rate be? Depending on the assumptions
Speaker 1: you want to use for that counter factual, we're fairly
Speaker 1: confident that the unemployment rate in any reasonable sense is
Speaker 1: still above eight percent. Still yes, when you take account
Speaker 1: of of people withdrawing out of frustration because they couldn't
Speaker 1: find jobs, that's then you get that high rate. So
Speaker 1: can we just get that that? You know? The question
Speaker 1: we have to ask about the Fed June July, September
Speaker 1: me up am I made me not until then? UM?
Speaker 1: I think for the FED, UM, the f O m
Speaker 1: C has made the case repeatedly that their data dependent.
Speaker 1: What they, I think are realizing now is that the
Speaker 1: data is not dependable. The market and the economy overall
Speaker 1: has had a long run. It's been a fairly good run,
Speaker 1: all things considered. But this is a mature recovery and
Speaker 1: we can't look for it to accelerate, particularly given external conditions.
Speaker 1: So uh that I don't think the said moves this summer.
Speaker 1: I don't think the said is going to move before
Speaker 1: the election. How about home construction and consumer spending? Both
Speaker 1: of those reports were pretty good. They were pretty good
Speaker 1: this month, but overall, home construction is still well down
Speaker 1: from where it was prerecession. UH. Consumer spending is up,
Speaker 1: but not not up so much that the savings rate
Speaker 1: has UH tipped down. Much of the the household sector
Speaker 1: is spending, but a lot of what they're spending is
Speaker 1: the benefit of lower gas prices, and as gas prices
Speaker 1: move up, that's going to rearrange where that money's being spent.
Speaker 1: Thank you very much for joining us. Patrick O'Keefe is
Speaker 1: the director of Economic Research at colne Resnick, also former
Speaker 1: Deputy Assistant Secretary of the US Department of Labor. Speaking
Speaker 1: about today's government report on non farm payrolls adding just
Speaker 1: thirty eight thousand workers in many you're listening to taking
Speaker 1: Stock on Bloomberg Radio. This Hampton's Commuter Minute is brought
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