U.S. Consumer – Full Speed Ahead

Written by Richard Hokenson 

There is at least one bright spot in the growing gloom regarding the outlook for global economic growth – the U.S. Consumer. The improvement in the normal metrics of average hourly or weekly earnings understate consumer spending power because they do not incorporate changes in the number of weeks worked during the year. Axiomatically, someone who works more weeks has more income whether they work full-time (35 or more hours per week) or part-time (1 to 34 hours per week). The most recent report on Work Experience of the Population supports the view that the consumer’s ability to spend is significantly better than commonly perceived. The proportion of workers who worked full-time, year-round (50-52 weeks) is at a new record high of 69.5% (see Chart 1). This reflects record high for both full time workers of 86.5% (see Chart 2) and part-time workers of 53.9% (see Chart 3).

Of course, there are obstacles to this positive outlook. Although an escalation in trade wars or a more intense backlash against immigration are risks, the larger risk is the Fed. We (Hokenson & Company) remain hopeful that Powell et al. truly believe that the expansion has room to run.



This update was researched and written by Richard Hokenson. Data is as of  20 December 2018

This article represents the views, opinions and recommendations of the author(s) regarding the economic conditions, asset classes, securities, issuers or financial instruments referenced herein. Distribution of this information to any person other than the person to whom it was originally delivered is unauthorised, and any reproduction of these materials, in whole or in part, or the divulgence of any of the contents hereof, without prior consent of Pricoa Capital Group is prohibited. Certain information contained herein has been obtained from sources that Pricoa Capital Group believes to be reliable as of the date presented; however, Pricoa Capital Group cannot guarantee the accuracy of such information, assure its completeness, or warrant such information will not be changed. The information contained herein is current as of the date of issuance (or such earlier date as referenced herein) and is subject to change without notice. Pricoa Capital Group has no obligation to update any or all of such information; nor do we make any express or implied warranties or representations as to the completeness or accuracy or accept responsibility for errors. These materials are not intended as an offer or solicitation with respect to the purchase or sale of any security or other financial instrument or any investment management services and should not be used as the basis for any investment decision. Past performance is no guarantee or reliable indicator of future results. No liability whatsoever is accepted for any loss (whether direct, indirect, or consequential) that may arise from any use of the information contained in or derived from this report. Pricoa Capital Group and its affiliates may make investment decisions that are inconsistent with the recommendations or views expressed herein, including for proprietary accounts of Pricoa Capital Group or its affiliates.

The opinions and recommendations herein do not take into account individual client circumstances, objectives, or needs and are not intended as recommendations of particular securities, financial instruments or strategies to particular clients or prospects. No determination has been made regarding the suitability of any securities, financial instruments or strategies for particular clients or prospects. For any securities or financial instruments mentioned herein, the recipient(s) of this report must make its own independent decisions.