Federal Reserve Should Be Focused on the Labor Report, Investment Pro Says

You may want to think twice the next time you come across real GDP print, according to Jim McCaughan, CEO of Principal Global Investors. ‘We’re looking at 0.5 percent GDP growth in the first quarter,’ he said. ‘But a labor market behaving as if it were growing at 2.5 percent. There’s a paradox here.’ He said the volume adjustments in real GDP are wrong and that if the gauge adjusted for quality of goods and services, the economy might be growing faster than we think. TheStreet’s Rhonda Schaffler reports from the 2016 Milken Institute Global Conference in Los Angeles.

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