It Looks Like a Recession Is Coming

The July jobs report from the Bureau of Labor Statistics was a disaster.

Only 114,000 non-farm payroll jobs were added, much lower than expectations and a sharp decline from the 215,000 monthly average seen over the past year. Additionally, revised employment figures for May and June indicated a net reduction of 29,000 jobs from the original estimates.

“The unemployment rate rose by 0.2 percentage point[s] to 4.3 percent in July, and the number of unemployed people increased by 352,000 to 7.2 million. These measures are higher than a year earlier, when the jobless rate was 3.5 percent, and the number of unemployed people was 5.9 million,” the report read.

The last time the unemployment rate was this high was in October 2021.

The biggest takeaway from the latest report is that the Sahm Recession Indicator—the most accurate recession indicator in history—was triggered, as the three-month moving average of the national unemployment rate has risen more than 0.5 percentage points compared to the minimum of the three-month average over the previous year.

“With today's terrible jobs report and another big smackdown of stocks, it certainly looks like the U.S. economy is standing on the front-end of a recession,” Larry Kudlow reported Friday on Fox Business.

There’s talk of an interest rate cut, but, as Kudlow notes, it won’t stop a recession from happening.

Meanwhile, all the liberals want the Fed to slash their interest rate targets to avoid a recession, but Fed policy changes in August or September wouldn't impact the economy for at least a year and, meanwhile, the plunge in market bond yields looks like a coincident indicator of recession, even while lower interest costs are welcome.  

Suddenly, after more than a year of the media dismissing the possibility of a recession, there has been a flood of articles about how recession fears have exploded.

So, as it appears we’re on the cusp of a recession, James Singer, the spokesperson for Harris’s presidential campaign, released the following statement:

Donald Trump failed Americans as president, costing our economy millions of jobs, and bringing us to the brink of recession.

Now, he’s promising even more damage with a Project 2025 agenda that will decimate the middle class and increase taxes on working families, while ripping away health care, raising prescription drug costs, and cutting Social Security and Medicare — all while making his billionaire donors richer.

We’ve made significant progress, but Vice President Harris knows there’s more work to do to lower costs for families.

It’s mind-blowing that the Harris campaign would blame Trump for the poor jobs report and accuse him of “bringing us to the brink of recession.” He hasn’t been in office since January 20, 2021, and yet the current economy is now his fault?

Does that make sense to anyone?

While it is nonsensical to blame Trump for the jobs report, especially when Kamala has been claiming for years that “Bidenomics is working,” there is a method behind the madness.

An election year recession is devastating to the party in power. Case in point: McCain had a nearly three-point lead in the RealClearPolitics average before the economic collapse in September 2008. Stagflation also contributed to Ronald Reagan’s landslide victory in 1980 over Jimmy Carter.

So, the Harris campaign is trying to push the narrative that Trump is to blame for the coming recession. Do they really think that will work? It’s a desperate and weak strategy that is destined to fail, but it’s the only play they have.