Speaking on Bloomberg's “Balance of Power” broadcast on Friday, Jared Bernstein, chairman of the White House Council of Economic Advisers, said in response to the August jobs report, “Markets have the ability to overreact. Where we are today is a very simple story if you just look at the basic facts: rising jobs, rising wages, falling unemployment, falling inflation. You put all of that together, and I think that's a recipe for continued growth, continued real gains and a sustained economic expansion.”
“When we look at the underlying pace of job growth right now, we're approaching what some people would call the breakeven point — the number of jobs that are sustainable and will keep unemployment the same or fall,” Bernstein said. “When we then look at the economy as a whole and look at consumer spending, real wage gains, the thousands of dollars that have increased the average household income over the last few years, we start to see the forward-looking dynamics that have driven this expansion and made it the strongest in the G7. My story today is very simple, as they say the Fed has a reaction mechanism and the markets have an overreaction mechanism. My story today, when you narrow it down to the fundamentals, is very simple: more jobs, rising wages, lower unemployment, lower inflation. When you put all of this together, I think that's a recipe for continued growth, continued real gains and a sustained expansion.”
Bernstein also said the August employment report could be revised upward.
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