Steady as she goes. As anticipation builds over Friday's jobs report from the U.S. government, more data is emerging pointing to what looks like sustainable growth in the real U.S. economy.
- On Wednesday, U.S. automakers reported generally good results, adding up to a seasonably adjusted annual rate of 12.26 million. Excluding the Cash for Clunkers blip, that's the best performance for the auto industry since September 2008 -- the month of the great crash.
- Jobless claims ticked up on Thursday, but the four-week moving average continued to fall, reaching its lowest mark since August 2008. On Wednesday, the private-sector jobs report from ADP employer services registered its biggest gain in three years.
- Retail sales numbers for November are coming in significantly over consensus projections.
- Goldman-Sachs raised its GDP growth forecast for 2011.
- There's even a sign of life in the housing market -- pending home sales surged in November.
The consensus prediction for Friday's labor report pegs the likely result at close to last month's numbers -- around 150,000 jobs, which barely keeps even with population growth and won't reduce the unemployment rate. But an upside surprise, as The Big Picture's Barry Ritholtz speculates, coming in the wake of a couple of months of consistently improving economic indicators, could be a very big deal. There's a lot of caution out there. Our "animal spirits" are low; everyone -- from employers to the employed -- is afraid of taking risks. But, as Ritholtz writes, "the psychology of a few months of strong data could have a very positive effect on hiring, wages, and capex [capital expenditure] spending."
Gloom feeds on gloom; optimism begets more optimism. A gradually improving economy won't do much to change the current state of vicious gridlock in Washington in the short term, but in the long term (is it time to start wondering about 2012 already?), it could make all the difference in the world.
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