The US economic recovery is turning from ‘forecast to fact’ but inflation is not a concern, Goldman Sachs says

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• US economy adds 916,000 jobs in March, trouncing economist forecasts as reopening begins Summary List PlacementHiring in the US rebounded in March as early reopening throughout the country and massive stimulus revived economic activity. Nonfarm payrolls grew by 916,000 last month, according to the Bureau of Labor Statistics. That comes in above the median estimate of 660,000 new payrolls from economists surveyed by Bloomberg. The reading is the largest one-month gain since August and marks a third straight increase. The jump follows an upwardly revised increase of 468,000 payrolls in February. The headline unemployment…
• CASE STUDY: How Goldman Sachs changed the retail banking game — by entering it (GS) Summary List PlacementDigital-only banks are redefining retail banking in major markets around the world. Spurred on by consumer frustrations with incumbents and growing willingness to use digital channels for accessing financial services, these tech-savvy players have acquired customers at pace and ramped up pressure on established firms. In the US, these challengers got off to a slower start than elsewhere, especially compared with Europe. But they've begun gaining traction in the last year. One of the most unique players at…
• Reopening turned into economic recovery in March, but it's just the base of the mountain Summary List PlacementAmerica's economic recovery has been somewhat disjointed over the last several months. When retail sales would surge, job additions would falter. Consumer sentiment would improve, but unemployment claims remained at elevated levels. And while manufacturers continued to enjoy outsize demand, restaurants and brick-and-mortar stores saw elevated COVID-19 infections eat into business.  Now, roughly one year after the pandemic began to spread across the country, those separate parts of the economy are rebounding in sync. Consumer sentiment soared to…
• Stocks are expensive and retail inflows are soaring, but Goldman Sachs says history shows the market is not in a bubble Summary List Placement Although stock valuations are expensive and retail inflows are soaring, Goldman's Peter Oppenheimer says the market is not in a bubble.  The chief global equity strategist detailed how many high stock prices are justified by historically low interest rates.  He also said that he doesn't see the same levels of broad speculation in the market that occurred in previous bubbles. Sign up here for our daily newsletter, 10 Things Before the Opening Bell. The narrative that the…
• California, U.S. weekly jobless claims rise again Unemployment claims in California jumped to105,600 last week, up 9,600 from the prior week, the U.S. Labor Department reported Thursday. Since business shutdowns began in March 2020, California unemployment claims have been above 100,000 for 50 of the last 54 weeks. “The state continues to see a high number of layoffs, even a year after the pandemic started,” said Michael Bernick, an employment attorney with law firm Duane Morris, and a former director of the state Employment Development Department. During…
• Pandemic cost Los Angeles County 557,200 jobs, 232% jump in unemployment The pandemic era’s first year cost roughly 1-in-8 workers in Los Angeles County their jobs and more than tripled unemployment. My trusty spreadsheet, filled with state job figures, found local bosses had 4.06 million workers in February — down 557,200 in the 12 months since the last time the economy wasn’t shackled by the virus. That translates to the pandemic cutting 12% of local jobs. It’s a very split job decline. Employment in “fun” industries — retail, eateries, tourism and…
• Bank of Japan survey more optimism over economic recovery Business sentiment is growing optimistic, a closely watched economic survey by the Bank of Japan showed Thursday, as the world’s third-largest economy continues to grapple with the damage from the coronavirus pandemic. The “tankan” survey’s headline index for big manufacturers’ sentiment stood at plus 5 in March, a considerable improvement over the minus 10 marked in December, and more positive than the forecast at plus 4. The survey's results highlight a steady recovery over the last three quarters to levels…
• Investors should stick with 4 kinds of stocks as Biden's infrastructure plan pumps up to $4 trillion into the economy, Bank of America says Summary List Placement Bank of America estimates Biden's infrastructure plan could pump up to $4 trillion into the economy.  Investors should focus on stocks that will benefit from an explosion of capex. Cyclical stocks, value stocks, and small-and-mid cap stocks will also perform well as the fiscal stimulus accelerates the economic recovery. Sign up here for our daily newsletter, 10 Things Before the Opening Bell. The next fiscal package out of Washington could total $3 trillion-$4 trillion and focus heavily…
• Biden's stimulus looks bigger than the New Deal, economics professor says Summary List PlacementTwo Democratic presidents. Two mass unemployment crises. Two federal spending plans to rescue the economy. So how does Biden's stimulus stack up to Roosevelt's New Deal? Maybe it's bigger. President Joe Biden's large-scale federal spending has already earned comparisons to the  New Deal, but a behavioral economics professor says the plan is setting its own precedent. "People think of the New Deal as this really, really aggressive response to the Great Depression. But part of the reason the…
• Bitcoin isn't 'too big to fail' but could still disrupt the global monetary system, veteran economist Mohamed El-Erian says Summary List Placement Bitcoin failing would challenge the "liquidity paradigm," Allianz's chief economist said. Investors are using bitcoin instead of government bonds and gold to reduce risk, El-Erian said. They're assuming that crypto will keep growing and governments won't interfere, he added. Sign up here for our daily newsletter, 10 Things Before the Opening Bell. Bitcoin is not "too big to fail"  — but could still disrupt the global monetary system if it collapses, Mohamed El-Erian told CNN this week.…