A Macro Data Extravaganza

Today we saw a flood of alphabet soup data, with news on the Gross Domestic Product (GDP), the ADP report on jobs and the Federal Open Market Committee (FOMC) meeting. Let’s take each one as a separate bite here, and see what the implications are for the markets.

First, today we saw the continuation of lackluster economic growth, as the nation’s GDP expanded at an annualized rate of 1.7% from April to June. While that figure did best Wall Street estimates for a GDP increase of just 0.9%, I don’t think sub-2% growth is anything to celebrate. Moreover, we got a downward revision in the first quarter GDP growth reading to just 1.1%.

Now, I am happy that the economy is growing, albeit slightly, but this rather tepid growth rate certainly doesn’t justify the Dow trading near all-time highs.


Earlier today, we did see a positive print in the form of the ADP payroll figures. The latest report showed that the U.S. private sector added a total of 200,000 jobs during July. That number is encouraging, as it shows that there is indeed some decent growth happening on the job front. However, the ADP employment data doesn’t really have a great track record of predicting the outcome of the most important data point that the Federal Reserve watches each day, and that is the monthly Labor Department employment data.

That data is due this Friday, and depending on how the print comes out, I suspect we will see traders move the needle on the news. The consensus estimate for job growth in July is 175,000 net new jobs, so if the official number exceeds that target it could be good for the markets.

Exclusive  Making Money Alert: The Fed-Fueled Market Rolls on

Finally, today we got word from the Federal Reserve and the FOMC that the current bond buying scheme of $85 billion per month will continue. Nobody really expected anything else from FOMC statement today. When it comes to the Fed, if you don’t get surprised, that is good news.

As for the bond market, traders are still betting that the Fed will begin “tapering” its bond buying program sometime later this year, and that view continues to put pressure on long-term Treasury bonds like the ones held in the iShares 20+ Year Treasury Bond Fund (TLT).

Making Money Alert

Interestingly, today’s FOMC statement effectively downgraded conditions in the economy, with the Fed saying that the U.S. economy is growing “only modestly.” The Fed did announce that it expects the economy to pick up later in the year, but if it doesn’t, and if the labor market remains under pressure, I suspect that any tapering either will be delayed or very modest going forward.

For now, the market is waiting on continued data to see if that will influence the Fed to make a change in current monetary policy. Until the data becomes clear, the market is likely to continue to bounce around current levels for the remainder of the summer.

The Perils of Being Dumb and Silent

“If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter.”

–George Washington

Leave it to the genius of a Founding Father to remind us how important our freedoms are, and just what’s at stake if we ever were to relinquish our rights to political leaders. Remember this the next time someone tries to persuade you that a new law or curtailment of freedom is in the “public interest.”

Exclusive  Signs of Weak Holiday Spending Are Starting to Emerge

Wisdom about money, investing and life can be found anywhere. If you have a good quote you’d like me to share with your fellow Making Money Alert readers, send it to me, along with any comments, questions and suggestions you have about my audio podcast, newsletters, seminars or anything else. Click here to ask Doug.

To read my e-letter from last week, please click here. I also invite you to comment about my column in the space provided below.

P.S. San Francisco Money Show, Aug. 15-17, San Francisco Marriott Marquis: Join me and all the other Eagle editors (Mark Skousen, Nicholas Vardy and Chris Versace), plus William O’Neil (founder of Investor’s Business Daily), Frank Trotter (Everbank), Matt Schifrin (Forbes), John Bollinger, Chuck Butler and many others. There is no charge for this conference, but you do need to register. Call 1-800-970-4355, and mention code #031734.

Like This Article?
Now Get Doug's FREE Special Report:
The New Gold Rush of 2016-2017

With gold already up 20% in 2016, one of the best market timers in the business sees even bigger things ahead. His free special report will show you how to play the coming “gold rush” for serious profits.

Get Access to the Report, 100% FREE

previous article

S&P 500 Declines on Fed Silence (Bloomberg) A lack of news from the Federal Reserve reversed Tuesday’s stock market rally, as the S&P 500 and the DOW dipped slightly Wednesday. Investors had hoped to hear whether the Fed was considering a reduction in stimulus spending. “The statement should come as no surprise, the Fed will remain largely data dependent as to asset


Dr. Mark Skousen

Named one of the "Top 20 Living Economists," Dr. Skousen publishes 4 different investment newsletter advisories, including the award-winning Forecasts & Strategies, which has beaten the market over the last 15 years.

Product Details

  • Forecasts & Strategies
  • Skousen High Income Alert
  • Fast Money Alert
  • Five Star Trader
About Mark Skousen

Bryan Perry

A former Wall Street financial advisor with three decades' experience, Bryan Perry focuses his efforts on high-yield income investing and quick-hitting options plays. Bryan's four newsletter and trading services include:

Product Details

  • Cash Machine
  • Premium Income (exclusively for subscribers of Cash Machine)
  • Quick Income Trader
  • Instant Income Trader
About Bryan Perry

Nicholas Vardy

A Stanford and Harvard Law graduate, Nicholas Vardy scours over 40 different global markets every day to uncover new profit opportunities for subscribers. His 3 advisories and trading services include:

Product Details

  • The Alpha Investor Letter
  • Bull Market Alert
  • Alpha Algorithm
About Nicholas Vardy

Doug Fabian

A 30-year Wall Street veteran and famed market timer, Doug Fabian is one the nation's foremost experts on ETFs (Exchange Traded Funds). His two ETF-focused advisories include:

Product Details

  • Successful ETF Investing
  • ETF Trader's Edge
About Doug Fabian

Bob Carlson

In Bob's monthly newsletter, Retirement Watch, he provides independent, objective research covering all the financial issues of retirement and retirement planning. In addition, Bob serves as Chairman of the Board of Trustees of the Fairfax County (VA) Employees’ Retirement System, which has over $2.8 billion in assets.

Product Details



Used by financial advisors and individual investors all over the world, DividendInvestor.com is the premier provider and one-stop shop for dividend information and research. Popular tools include our proprietary Dividend Calendar, Dividend Calculator, Dividend Score Card, and many more.

Product Details