Saturday, September 4, 2010

Payrolls Day Review

Not a bad day . Four winners before the Open plus 6 more during the Day Session. Plus a winning Open Position.
As with the Manufacturing PMI report, however, the details point to a far less rosy picture than the headline figure and market reaction suggest ;

Aggregate hours worked were flat.

All the employment gains were part-time — full-time employment, as per the Household Survey, plunged 254,000.

Those working part-time for “economic reasons” surged 331,000 — the biggest increase in six months.

While private payrolls were better than expected, 10,000 of that +67,000 tally reflected returning construction workers who had been on strike.

Manufacturing employment was down 27,000 and total goods producing jobs were flat — hardly signs of a robust economic backdrop.

The diffusion index for private payrolls actually fell to 53.0 from 56.7 in July — a seven-month low. It was 68.0 at the April high, which is consistent with an economy slowing down to stall-speed.

The labor market gap widened with the all-inclusive U6 unemployment rate rising to a four-month high of 16.7% from 16.5% in July. This is why the odds are stacked against a sustained acceleration in wages.

Keep in mind that markets did not have much time to digest the US jobs reports Friday before markets closed, and could well take back gains next week upon reflection on the above details. Volumes in the stock market rallies were exceptionally thin, further undermining out belief in the rally.
Wishing all of you a wonderful Labor Day Weekend. If you have a full time job with benefits, consider yourself very lucky and enjoy it before the Chinese Communists take it away, complements of our Republicans politicians under pressure from their Corporate constituents( a.k.a Free Trade Bullshit Continues).

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