Just an hour before August jobs numbers were released by the Labor Department on Friday, Fox Business host Stuart Varney made some bold predictions about the state of the Donald Trump economy — and he was spot on.
On the money estimate
Varney, who covers market trends and current events on his daily morning show, “Varney & Co.,” appeared on “Fox & Friends” to discuss the Friday jobs outlook, and his optimistic assessment called for a “generational low” in unemployment. Watch the British-American economist give his best guesses about August’s jobs report:
“The economy is booming,” Varney observed. “I think we are going to see roughly 200,000 new jobs. That’s quite a strong performance. I think we may see the unemployment rate tick down to 3.8 percent. That will be a generational low,” he said, referring to the last time unemployment rates reached similar lows in the 1960s.
“But perhaps more importantly, I think we are going to see wages tick up … That’s a very good sign for middle America,” Varney predicted.
Trump’s economic progress has been impeded by wages that have refused to budge despite corporate and payroll tax cuts. Ward McCarthy, chief financial economist at Jefferies LLC in New York, called weak wage growth “the one fly in the ointment in the last few years,” pointing to the importance of Barney’s forecast.
The good news
Although Varney cautioned that, “You don’t want to forecast numbers that are going to be released in 45 minutes time,” his predictions were confirmed at 8:30 a.m. with the publication of the Bureau of Labor Statistics employment outlook. According to those reports, 201,000 jobs were added in August, exceeding official estimates.
Although the unemployment rate remained steady at 3.9 percent, Varney assessed that “you’re going to see a lot of those people who are currently on the sidelines come into the labor force.” However, the most impressive gains occurred with wages, which skyrocketed by 2.9 percent in the greatest increases since the recession ended in 2009.
“Perkier wages are the final confirmation the labor market is back to normal,” McCarthy said. The growth exceeded all estimates in a Bloomberg survey which projected just 2.7 percent wage hikes.
“As far as our economy is concerned and our stock market, we are the only game in town. All the way around the world, economies are stagnating and markets are falling.”
Global economic frontrunner
A government deleveraging campaign and the ongoing trade dispute with America is beginning to cripple growth in China, while Europe, Japan and other emerging economies are beginning to experience a slowdown in growth. Meanwhile, American had surpassed the Euro Zone as the principal driver of world economic growth.
August’s job expansion and wage growth is vindication for Republicans who have argued that trickle-down economics would pull America out of eight years of anemic economic progress. Attempts to downplay the effects of the tax stimulus bill have been subverted by an economy that consistently outperforms even the most optimistic estimates.