RE:RE:Canada…Solid Q1 GDP..3.1% …April up Too Nozz, you're very good at analyzing coincident indicators. You're not very good at interpreting leading indicators.
For instance, low unemployment is a leading indicator that we are at the top of the market cycle. Companies are hoarding labour because of its scarcity and cheapness which brings the unemployment rate lower not higher. Then, monetary policy begins its journey and companies begin to scale back on hiring. Unemployment is the last man standing in every market cycle. Soft landing narratives gain momentum because people are looking at the wrong metrics. They are too absorbed in coincident indicators.
There is plenty of talk about Bank of Canada raising interest rates in the future because of the latest gdp data. This is why a recession is almost unavoidable because when they see a strong labour market and gdp, then interest rates hikes gain momentum all over again.
In the US, total hours worked per week is declining which is what happens just before layoffs. Companies hold on to labour for as long as they can, then they reduce hours which eventually leads to job losses. Almost half a million Americans (440k) lost their jobs in the latest household survey. There are now 6.1 million Americans unemployed.
I would not trust a Ceo claiming that he sees no recession on the horizon. Ben Bernanke, the Fed chairman in 2008 was flat out wrong about his forecast of a soft landing in the great financial crisis. If he could get it wrong, I'm pretty sure a ceo of a clothing company can get it wrong.