The Employment Situation report is arguably the most important economic release. So, I was surprised when I read an article on Bloomberg this week imploring potential voters to not base their vote for President on this morning’s number. But, if the economy is the largest political issue, how could the payroll number NOT impact at least a few people? What are folks supposed to do? Ignore it? Pretend it doesn’t matter?
I suppose the thought process at Bloomberg View was: “one month of labor market data shouldn’t unduly impact a decision of such major importance.” So what if the ultimate number was, say, 25K more or less than expected? That is essentially a rounding error in the US economy. To that end, yeah, you probably shouldn’t let a headline number skew your decision making process. But what if you were to really delve into the numbers?
That is a different story altogether, but so few people actually go to the trouble of analyzing the 38-page report. They see this morning’s headline: “Economy creates 171K jobs, more than expected. Unemployment Rate ticks up to 7.9%.” That is enough, right? I guess it is for Joe Sickspaque.
Still, I was surprised when I came out of a meeting this morning at 9:30 to see the markets had fallen into red territory. When I had gone into the conference room at 8:30, it looked as though we were going to have a pretty good day; after all, stock futures were positive, and why not? 171K jobs was better than expected, and the Bureau of Labor Statistics had made a positive revision to the September number. All told, at first blush, the number looked pretty good, the slight uptick in the Unemployment Rate notwithstanding.
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