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Week In Review


The U.S. economy added 209,000 jobs in July.  The unemployment rate fell to 4.3%, labor force participation rose to 62.9%, and wages rose 2.5% year-over-year.

Our Take

This was a stronger-than-expected jobs report.  The labor market continues to show improvement, however this is not translating into an acceleration in other economic measures.  The Fed will likely read this report as confirming that the economy is moving toward full employment and that inflationary pressures will build.  This interpretation will support the Fed’s current trajectory of slow tightening and balance sheet reduction.

Income & Spending

U.S. personal incomes were unchanged in June following a 0.2% rise in May.  Personal spending rose 0.1% in May.

Our Take

Improving labor market numbers are not yet translating into an increase in spending.  The U.S. economy seems likely to continue to plod along.


Maduro moved to establish his Constituent Assembly that will be appointed by him and have extra-constitutional powers.  This move immediately led to widespread protests and violence, and authorities arrested two opposition leaders.  The U.S. Treasury department issued sanctions on Maduro’s personal assets.

Our Take

Venezuela appears to be steadily moving toward outright dictatorship.  The only real significant measure the U.S. could take would be to ban imports of Venezuelan crude oil.  However, this step would have a significant impact on fuel prices in the U.S., because Venezuelan crude is an important feedstock for many gulf coast refineries.


Illinois Governor Bruce Rauner partially vetoed a school funding bill this week.  Senate Bill 1 was approved by the Illinois House and Senate earlier this spring.  Governor Rauner’s veto removed money intended for Chicago Public Schools, including a block grant and pension funding.  Chicago Mayor Rahm Emanuel voiced his opposition to the partial veto and called on Rauner to “stop playing politics with our children’s futures.”

Our Take

Lawmakers approved the bill last spring but held on to the legislation instead of putting it in front of Governor Rauner, who had already indicated that he would veto the bill.  By exercising his veto power and stalling the bill, Governor Rauner’s actions have led to more uncertainty for Illinois school districts.  Republicans and Democrats must compromise to find a workable solution for school funding.  Illinois school districts cannot afford another impasse.


All expressions of opinions are subject to change without notice in reaction to shifting market conditions.  All information is based on sources deemed reliable, but no warranty or guarantee is made as to its accuracy or completeness.  Neither the information nor any opinion expressed herein constitutes a solicitation for the purchase or sale of any securities, and should not be relied on as financial advice.