Employment Unchanged — Market to Drift Lower

As I have been telling you, the major story this week for markets has been the jobs reports. The ADP report out Wednesday didn’t look too bad. But the Challenger job cuts report out Thursday was a little less optimistic, showing cuts had rebounded, some.

So this morning, we get right to the Department of Labor numbers just out:

“Total nonfarm payroll employment increased by 160,000 in April, and the unemployment

rate was unchanged at 5.0 percent, the U.S. Bureau of Labor Statistics reported

today. Job gains occurred in professional and business services, health care, and

financial activities. Job losses continued in mining.

Household Survey Data

In April, the unemployment rate held at 5.0 percent, and the number of unemployed

persons was little changed at 7.9 million. Both measures have shown little

movement since August. (See table A-1.)

Among the major worker groups, the unemployment rate for Hispanics increased to

6.1 percent in April, while the rates for adult men (4.6 percent), adult women

(4.5 percent), teenagers (16.0 percent), Whites (4.3 percent), Blacks (8.8 percent),

and Asians (3.8 percent) showed little or no change. (See tables A-1, A-2, and A-3.)

The number of long-term unemployed (those jobless for 27 weeks or more) declined

by 150,000 to 2.1 million in April. These individuals accounted for 25.7 percent

of the unemployed. (See table A-12.)

In April, the labor force participation rate decreased to 62.8 percent, and the

employment-population ratio edged down to 59.7 percent. (See table A-1.)

The number of persons employed part time for economic reasons (also referred to

as involuntary part-time workers) was about unchanged in April at 6.0 million

and has shown little movement since November. These individuals, who would have

preferred full-time employment, were working part time because their hours had

been cut back or because they were unable to find a full-time job.

(See table A-8.)

In April, 1.7 million persons were marginally attached to the labor force, down

by 400,000 from a year earlier. (The data are not seasonally adjusted.) These

individuals were not in the labor force, wanted and were available for work,

and had looked for a job sometime in the prior 12 months. They were not counted

as unemployed because they had not searched for work in the 4 weeks preceding

the survey. (See table A-16.)

Among the marginally attached, there were 568,000 discouraged workers in April,

down by 188,000 from a year earlier. (The data are not seasonally adjusted.)

Discouraged workers are persons not currently looking for work because they

believe no jobs are available for them. The remaining 1.1 million persons

marginally attached to the labor force in April had not searched for work for

reasons such as school attendance or family responsibilities.

One report does not a trend make. However, with numbers as good as they have been the past several months (whether you believe them or not), it’s hard to see any additional upward momentum developing.

In the meantime, as we noted for subscribers on the Peoplenomics side of things, start watching for the automation, robotics, and drone stories to pick up tempo, now. How those work out – and how many humans get “left in the loop” will largely determine how the next 10-20 years work out.

In long wave economic terms, the 2009 housing bust sure looks to me like the market bust in 1921. There were about four – maybe six, depending on where you count from – during the first 22-years of the 20^th Century. Then they got a long break: From the market bust in 1921 until the top in early September of 1929. Then the crappola hit the fan.

Then, like now, the Fed was under some pressure to raise rates. It’s useful to remember that there were several small hikes in 1927-1928.

Making things worse, the 1929-1931 Fed was asleep at the switch when came time to lower rates.

One has only to recall that in May of 2000, the Fed was still raising rates – and arguaby, the Tech Wreck could have been a lot softer if the Fed had been more anticipatory.

I lay out a few of the data points, because we are less than a month from the next meeting of the European Union central banksters.

European trading today is down about 8-10ths of one percent. If the U.S. markets follow suit, a decline today of around 100 points could be in the cards. And there is enough inter-market arbitrage to at least mention that as a possibility.

Looking at the Global Index components we track, the Hang Seng in Asia is getting quite close to the 20-thousand level. Sinking below that would be very bad.

In Europe, the German DAX which had been one of the real high-fliers, is more than 200 points under the 10,000 level, and with a solid decline through psychological support, it flips and becomes overhead resistance on the way back up.

For what it’s worth the old adage “Sell in May and Go Away” may have come early this year. Still, a summer rally could be in the cards into early September (presidential optimism and so on) but we will have to wait and see how the testimony under oath goes.

What Testimony?

Oh, that.

Well, let’s see: We have Huma reportedly being deposed under oath.

Then there is something of a victory dance as Judicial Watch reveals that there are even more undisclosed Hillary emails which could lead to her being deposed in coming weeks.

And what about reports of action to come in Washington?

Something to keep a close eye on: You will notice that some of the (remarkably, still pro-Clinton) media are being very careful to plant disclaimer like (and I will paraphrase) “investigators have failed to find any wrongdoing…”

If you haven’t figured it out yet, the reason Bernie Sanders hasn’t dropped out of the race yet is simple: He could win the party nomination by default if the Clinton email scandal blows up between now and convention time. Or, he could be the acknowledged back-up plan if it blows up after the presumptive coronation of Her.

As long as we are on politics, I meant to mention that it struck me as slightly odd that Ted Cruz packed it in just 24-hours after the photo of Cruz’s dad passing out leaflets with one Lee Harvey Oswald surfaced in a public way.

Not saying there is anything to hide, but seems to me there are a lot of questions around that which could be answered, if for no other reason, than as important background to those of us who vote in Texas.  If it was a fake, who did it?

Failing Media?

Here is another interesting question the press is unlikely to ask: Why did NBC News seeming sit on the Hillary Clinton email server hack for weeks?

Could it be – as one Obama insider seems to be saying – that the Obama administration really does control the media? Sheesh.

Full Employment for Lawyers Dept.

Loved this: “Arsenio Hall Sues Sinéad O’Connor for $5 Million Over Prince and Drug Accusations.

For the Weekend:

If you’re not doing anything, you might pop over to Pyong-Yang North Korea.

Tell ‘em you used to play with Dennis Rodman, and I’m sure they will let you in.  Sp what if you’re 5’2” – think they’d know?

Once there, tell ‘em you’re from the American Communist Party and you’d like to address the People’s Congress which is going on.  Or tell them you’re with the Sanders Administration.

I’d offer to go myself, but the Gulfstream is in the shop and the eyes aren’t good enough to forge documents this week.

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In this weekend’s Peoplenomics.com report, we will go over some of the ways to handicap the presidential election. No, we don’t really care who wins (like it matters, terribly). Instead, we look at it as a kind of early-warning system for how to set your investment bets for the coming four years…and that is a really useful thing to do.