On April 2, 2015, we issued an unemployment rate forecast that stated, in part:
"Our Fully Adjusted Return® Model, combining social and financial data, predicts a 5.4% rate for March. Unemployment has been trending down since the beginning of 2009. The long term trend is declining, as the chart below shows. We see no reason for this to change. The only risk is that we may be a little early."
As one outlet noted, "US employers added jobs at a solid pace in June, and the unemployment rate fell to 5.3 percent, a seven-year low." Today's rate release confirms our 4/2/15 forecast.
The chart above shows the overall Unemployment Rate (Blue), the rate for African Americans (Brown) and the difference between the two. (Gray line, scale at right.) We think the level and the volatility of this difference is a key indicator of the overall social and economic health of the country.
GDP
On May 28th, we issued a Fully Adjusted Return® forecast for GDP that, similarly, was a little early. At the time, we stated that: "Our 2015 Fully Adjusted Return® forecast for GDP suggests there will be no change, in other words, we will have a first quarter 2015 GDP estimate that reflects virtually no change, or negative 0.5%." The decline was reported at -0.7% at the time, and most economists expected a rise of +0.2%.
On June 24th, The Wall Street Journal reported "Gross domestic product, the broadest sum of goods and services produced across the economy, contracted at a 0.2% seasonally adjusted annual rate in the first quarter, the Commerce Department said Wednesday. The latest figure matched economists’ forecasts." Contrary to the Journal's implication, most economists missed the turn on May 28th. By June 24th, they caught up.
We were, again, early.
As one outlet noted, "US employers added jobs at a solid pace in June, and the unemployment rate fell to 5.3 percent, a seven-year low." Today's rate release confirms our 4/2/15 forecast.
The chart above shows the overall Unemployment Rate (Blue), the rate for African Americans (Brown) and the difference between the two. (Gray line, scale at right.) We think the level and the volatility of this difference is a key indicator of the overall social and economic health of the country.
GDP
On May 28th, we issued a Fully Adjusted Return® forecast for GDP that, similarly, was a little early. At the time, we stated that: "Our 2015 Fully Adjusted Return® forecast for GDP suggests there will be no change, in other words, we will have a first quarter 2015 GDP estimate that reflects virtually no change, or negative 0.5%." The decline was reported at -0.7% at the time, and most economists expected a rise of +0.2%.
On June 24th, The Wall Street Journal reported "Gross domestic product, the broadest sum of goods and services produced across the economy, contracted at a 0.2% seasonally adjusted annual rate in the first quarter, the Commerce Department said Wednesday. The latest figure matched economists’ forecasts." Contrary to the Journal's implication, most economists missed the turn on May 28th. By June 24th, they caught up.
We were, again, early.