● The Fed’s Labor Market Conditions Index remains mildly positive in July
● NY Fed: US consumer spending expectations drop sharply in new survey
● Treasury market’s US inflation estimate is sliding
● Economic confidence in Germany slides to 9-month low in August
● China devalues its currency
● Will China’s devaluation spark a currency war?

Positive price momentum is in short supply these days among the major asset classes. Is that a bearish signal? Well, let’s put it this way: the current technical profile doesn’t inspire a lot of confidence about the near-term outlook for asset prices.
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● Rise in US payrolls in July suggest a Sep rate hike
● US consumer credit in June posts bigger-than-expected gain
● Eurozone investor confidence declines in August
● China’s stock market jumps on stimulus hopes
● Japan July Economy Watchers’ Current Index ticks up for July
● Bank of France expects slow but steady growth for France

● Humans Need Not Apply: A Guide to Wealth and Work in the Age of Artificial Intelligence
By Jerry Kaplan
Summary via publisher (Yale University Press)
After billions of dollars and fifty years of effort, researchers are finally cracking the code on artificial intelligence. As society stands on the cusp of unprecedented change, Jerry Kaplan unpacks the latest advances in robotics, machine learning, and perception powering systems that rival or exceed human capabilities. Driverless cars, robotic helpers, and intelligent agents that promote our interests have the potential to usher in a new age of affluence and leisure — but as Kaplan warns, the transition may be protracted and brutal unless we address the two great scourges of the modern developed world: volatile labor markets and income inequality. He proposes innovative, free-market adjustments to our economic system and social policies to avoid an extended period of social turmoil. His timely and accessible analysis of the promise and perils of artificial intelligence is a must-read for business leaders and policy makers on both sides of the aisle.
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US companies added 210,000 workers in July, the Labor Department reports. The gain matches Econoday.com’s consensus forecast. Although last month’s increase in private-sector payrolls was modestly below June’s 227,000 gain, today’s update continues to reflect a solid 2%-plus trend advance in year-over-year terms. The annual pace is still decelerating, but fractionally so. The bottom line: the labor market continues to expand at a healthy pace and for the moment the trend looks poised to endure. In turn, the case for a near-term rate hike by the Federal Reserve looks a bit stronger today.
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The Wall Street Journal’s Jon Hilsenrath — considered to be one of the most “well-connected” Fed reporters — writes today that “A Bad Jobs Report Still Might Not Shake Fed’s View.” In other words, today’s payrolls data from the Labor Department that’s scheduled for release later this morning at 08:30 am eastern isn’t likely to derail the central bank’s plans to start raising interest rates—perhaps as early as next month. Nonetheless, the near-term outlook for the timing of tighter monetary policy remains cloudy, based on the mixed signals in Treasury yields.
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● US jobless claims rise, but remain close to four-decade low
● Challenger says US layoffs hit four-year high in July
● Bloomberg’s US Consumer Comfort Index falls for fifth straight week
● Today’s payrolls report from Washington is expected to show solid growth
● WSJ: “A Bad Jobs Report Still Might Not Shake Fed’s View”
● Germany’s industrial output unexpectedly dropped in June

Private nonfarm payrolls in the US are projected to increase by 205,000 (seasonally adjusted) in tomorrow’s update for July from the Labor Department, based on The Capital Spectator’s average point forecast for several econometric estimates. The prediction reflects a modestly lower increase vs. the 223,000 advance in June.
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Yesterday’s ADP estimate on US private payrolls in July was a bit of a disappointment. Companies added 185,000 workers last month—the smallest gain in three months. The news implies that tomorrow’s official jobs report from Washington for July will also reflect softer growth. Is the weaker-than-expected increase a sign that the labor market’s cooling? Maybe, although the latest ISM Non-Manufacturing survey numbers for July suggests that the services sector, the primary source of US employment, is still adding new jobs at a strong pace. In other words, last month’s softer payrolls report via ADP is mostly due to manufacturing—the energy sector in particular, which is reeling from sharply lower commodity prices. The broad trend for US employment, however, continues to look encouraging, courtesy of the upbeat numbers in services.
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● ADP: US private-job growth slows in July
● ISM: US services-sector growth accelerates in July
● US Services PMI strengthened in July
● US trade gap rises 7% in June on stronger imports
● PMI: global economic growth ticked higher in July
● Eurozone retail PMI surges to 4-year high in July
● German factory orders surged in June
● UK industrial production is surprisingly weak in June