April job growth was slightly off expectation, and that has given long Treasury notes and mortgage rates a breather, but nothing more. The whole fool world of finance, including the Federal Reserve, assumes an economic slowdown near ahead, but the actual data is hot. Until this mythic slowdown appears, long-term mortgage rates remain on hair trigger for 7 percent. Today's April payroll forecast called for 200,000 new jobs, and 138,000 actual produced a relief rally in bonds. However, wages are rising at a 4 percent pace, and every inflation measure is flashing red: one of the best (PCE deflator) rose at a 4 percent rate in March, up 2.9 percent year-over-year, and the core is at the Fed's tripwire, up 2 percent. In other April numbers, the purchasing managers' indices accelerated a...
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