well some good news we need some good
news on folks getting back to work
kroger is seeing a spike in job
applications
following a massive hiring event last
month resulting in nearly 5 000
new job offers and they actually have 10
000 jobs they want to fill
let's get reaction from market watchers
francis newton-stacy
dave manny and john lonsky good to see
y'all john
this does say a lot for the american
worker the fact that despite
all of those great unemployment benefits
that are out there for people
there are so many people that are that
are looking
uh for long-term jobs out there
well that's a change for the better but
the fact remains that there are a number
of small
businesses that are in desperate need of
workers i mean we had a survey taken by
the national federation of independent
businesses
that's a trade association for small
businesses
it consists of a lot of smaller
construction companies and restaurants
and a record 48
of those responding to the survey
claimed that
job openings were hard to fill and
moreover
the biggest problem faced by small
businesses
is not taxes not regulation not slow
sales but rather labor quality getting
the right people
to fill the available slots but francis
i i don't want to bury the lead here
which i think is a good lead a good news
story lead which is that kroger's did
fill
5000 jobs they did offer they did by the
way have to offer a lot
16 an hour and when you add in the
benefits it comes to 21
an hour that kroger's putting out to get
these new workers
is that is that kind of going to be the
new standard here in in the united
states in order to get the workers
you're going to have to go above 15 an
hour
well i think that is sort of becoming
the new standard and we've tried to
legislate that as
you know a fifteen dollar an hour
minimum wage however
these inflationary pressures and the
supply
can supply chain constraints and some of
this unemployment
backlog is going to probably change
going into the latter half of the year
the fed
has very little they can actually do
because the problem is
is that everything that they do has a
lagging effect on the actual economy
the markets will trade the news in an
instant but it has a lagging effect and
because
we have deflationary pressures coming
into the system in the back half of the
year
bank loans are going down fiscal
spending the rate at which fiscal
spending is coming in is going down
which is
would be the same as tapering on the
balance sheet
so some of these things are going to
work their way out and that means that i
think that
these extraordinary measures that kroger
and others are taking to get employees
will be mitigated into the end of the
year well perhaps but dave i'm just
wondering
do you suspect there's a conspiracy
theory but that the blind administration
was looking
to bump up salaries to to have a minimum
15
an hour wage uh by increasing
unemployment benefits
by so much for so long
yep wow yes of course they were
i mean it plays very much in line with
their you know with their messaging and
with their base and frankly i mean
i mean i thought that the trump
administration was profligate
but i mean this at the the biden
administration is like
you know profligate on you know
on a on a sure leave weekend i mean
there's just like no attention at
all to kind of future implications of of
the spending
and and and i very much believe
that we're not seeing the full effects
yet yeah in these inflation rates and
that
we are in for a rough ride because i
don't think there's going to
be no stimulus not under this president
uh we're getting a little pause in your
electronic uh
uh signal there for for uh dave but john
i want to go back to you
uh the fact is is that we just we just
had the story on on hundreds of billions
of dollars that might have been scammed
away from these government programs
when you have this much money uh with an
administration let's face it that
doesn't have a lot of business
experience they've got more political
experience they're willing
to look askance at money being wasted in
politics unlike the trump administration
that had a
more of a razor focus on waste in
government uh
you're going to have spending that is
just totally out the window i mean
spending on on useless things scamming
being subject to scammers etc
uh that's that's a very bothersome
problem no
oh you are so correct and when you're
spending these huge amounts of money
you're inviting scammers and i can't
help but be troubled by the fact
we say that we have all these great uh
data scientists around today
why can't we do a better job of keeping
track of each dollar spent
and moreover why isn't this money for
the most part
going to people who really need it
not the people who don't need it and
that's one of the reasons why we're
looking at this huge increase in
personal savings
and as this savings bulge gets released
you are going to have higher inflation
for a longer period than
many people now expect the other guest
was spot on
yeah well and francis we did have that
that comment from bullard today from the
fed
uh that in fact they may have to raise
rates in 2022
a year earlier than than we heard from
the fed chief
and that's what's sending markets down
so much today
is is there going to be continuing back
and forth on this or will the fed come
to a consensus that it's likely to
happen earlier than later
i think that there will be a continued
back and forth and the and the reason is
is that they're going to have to start
tapering the asset purchases before they
raise interest rates because
the asset purchases are also easing and
so you don't want to put your foot on
the gas and the brakes at the same time
because you're going to negate your own
policy and so
we won't really see any activity out of
the fed until they
taper those asset purchases but the
fiscal stimulus is doing that for them
because
even whether or not we get an
infrastructure package the money's not
going in at the
same rate that it was because the
spending is now
over a longer period of time and so
there will be some tightening effect
from the slowing in the fiscal stimulus
and i know many people agree with that
and they say stop spending
but it will have a tightening effect on
the economy dave there's an old phrase
gilding the lily which a lot of people
suggest is what the fed
is doing you have the release of the
economy not just here but the world
economy after the lockdowns after the
pandemic lockdowns
it's it's it's getting going on its own
juices there's pent-up demand so the
consumers out there buying stuff
uh and you still have the fed acting as
though we're in a recession when we're
coming out of a recession but
to buy for example every month 40
billion dollars of mortgage-backed
securities
what the hell's in their mind i mean we
have we does does real estate
really need the fed to be buying 40
billion a month in mbss
clearly not i mean we're at this point
where we're 40 years
out from the kind of stagflation numbers
and 40 years is a long time
for us to have institutional memory and
i'm afraid
now that i'm an old guy that that people
of my
era david and probably yours remember
that
much too clearly and and i don't think
that the
that the core policy makers are taking
the proper amount of caution
and i think we're all going to pay for
it and those of us in business
are really going to pay for it as our
consumers in the coming months and years
john do you agree there's nothing we can
do to stop it at this point
well we have to do our best to try to
slow things down
i mean we just can't go on with this
current level of fiscal stimulus
we've yet to spend as i noted earlier
the super high personal savings rate
tells us we've yet to spend
all the stimulus that we applied last
year and recently
there's no need for additional fiscal
stimulus and we have to show
greater caution with monetary policy my
goodness the spread between mortgage
yields
and the 10-year treasury is uh 1.4
percentage points that ought to be wider
the reason why it's so narrow is because
the fed is needlessly buying all of
these mortgage-backed securities each
month it's time to wake up
you know what i'm hoping for is gridlock
a lot of people say it's it's a disaster
when congress is gridlock i think that's
just what we need right now to prevent
any more of this spending that's leading
to all this calamity all over the place
thank you gang i appreciate it