Jobless Claims numbers were ugly yet again. However, tomorrow's Nonfarm payrolls number may be fairly good (considering where we have been), adding about 90,000 private sector jobs. That however may be as good as it gets for a while. Why is this so? For months equity market bulls have talked down the jobs data because it they are lagging indicators and do not yet reflect the strength of the economic reovery.
The fact that they are lagging indicators is why tomorrow's data may be a near-term peak. Tomorrow's private sector data reflects conditions during the height of the economic rebound. Most recent leading and coincidental indicators have been disappointing. If jobs data dutifully lags as is typical, the employment picture may be gloomy for the balance of 2010. The bond market appears to be factoring this in.
The fact is that the Fed is out of ammunition and cannot create the fundamentally unsustainable growth to which American's have become accustomed during the past two decades. We are going back to the future (I just hope Ford doesn't bring back the Edsel).
I can't wait until tomorrow.
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