January 9, 2010
Underwater and Lovin’ It?
The headline from MarketWatch this morning reads ‘Silver lining in job-loss data’. While you would expect to find optimistic takes on what was clearly a negative jobs report, the line below the ridiculous headline was nonetheless shocking:
“Friday's payroll report indicates Fed's unlikely to raise interest rates anytime soon.”
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That the U.S. recovery is so feeble the Fed can not raise rates above zero percent is considered a ‘silver lining’? By this standard Japan is the undisputed king at collecting silver linings, although for what good such linings serve I do not know...
The U.S. has lost 7.24 million jobs since January 2008 (Excel) and the U.S. government has shed 89 thousand government jobs since September 2008 (another 21 thousand U.S. government jobs were lost in December). Jobs losses at this stage of the game are ominous news for the investors, politicians, and regulators that are collectively holding their breath waiting for recovery – they have been holding their breath for about 17 minutes versus David Blaine’s under water record of 17 minutes and four seconds.
In short, the U.S. economy must (and likely will) start producing jobs very soon, or the outlook for the U.S. financial markets and U.S. dollar could turn decidedly negative as policy makers reluctantly admit defeat and plan what is sure to be yet another borrow/spend exhale strategy.
BLS ~ Northern Trust Coverage