Skip to comments.Per twitter NFP 162K, Exp. 185K (Epic Fail)
Posted on 08/02/2013 5:30:41 AM PDT by Perdogg
NFP 162K, Exp. 185K— zerohedge (@zerohedge) August 2, 2013
Found one they couldn’t fudge enough this week. How about that?
Oh, that’s great news!
Now Mr. Bernanke can keep his magic printing press going and continue to flood the market with worthless dollars.
But, the unemployment rate just dropped to 7.4%. WTF? (over)
But....but.....but.....didn’t unemployment go down??
labor participation rate dropped thats why it went down, its ridiculous.
No...they lie based on “expected” growth and then change the number back (quietly) back to reality the next week, and they have done this on every single jobs report during this administration. Every single one. (not to mention how they changed how employment and unemployment are calculated in order to make themselves look better).
Payrolls Miss 162K vs 185K Expected, June Revised Lower To 188K; Unemployment Rate 7.4%
Whatever you do, don't look at YTD full/part time breakdown— zerohedge (@zerohedge) August 2, 2013
Silver is suddenly straight up almost a buck, and the DJII futures lost 50 points in about a minute. Looks like bad news is bad news for once.
Market whisper number was 200k +. Big miss.
Don’t forget the May revision -29,000
A ZH poster made the point that in a normal world people would look at this weak number (162K) and say the Fed has been doing everything in their power, yet the numbers after 5 years are still bad.
One thing at this point should be perfectly clear: Trillions of dollars spent by the central planners have failed to improve the economy. We will pay a very high price in the future for this epic failure and the resulting economic distortions.
Full report here:
240K stopped looking for work last month.
Exactly right. Would like the resident freepers who come on these threads and try to turn Obama’s sow’s ear into a silk purse to respond to that.
That’s a bit short sighted by the ZH poster. The Fed has done the right thing supplying the needed liquidity (look at velocity) but they are fighting the fiscal and regulatory and tax side of the government. Things would be a hell of a lot worse if the Fed didn’t supply the liquidity the system is demanding. The economy is still weak because the business environment created by this administration is openly hostile to business and profits. My company is still hesitant ant to hire because we aren’t sure what the regulatory, tax, healthcare cost environment is going to be.
Maybe this administration wouldn’t have been re-elected to continue their hostility to business and profits if people had been able to see the full effects of such.
Things would be a hell of a lot worse if the Fed didnt supply the liquidity the system is demanding.
Understand your point and agree about the hostile business environment we are currently in. While the Fed’s massive injections of liquidity into the system may have helped in the short run, its endless continuation will severely damage the economy in the long run. I think even Bernanke would acknowledge that. IMO the Fed’s stimulative actions reduce the incentive for the president and Congress to do anything about the fiscal and regulatory hell that they’ve created. In that sense, the Fed has become an enabler and its prolonged artificially low interest rates are causing distortions in the economy that we will come to regret down the road. Just my opinion. Regards.
Liquidity is all about timing. If the Fed doesn’t withdraw when velocity turns up then it can be very damaging in the form of inflation. But not injecting in the face of demand is worse i.e Deflation. Bernanke and a number of the governors have yp talked about the fiscal disaster that is Congress and the growth crushing regulations of this administration. Yes I agree that the Fed is essentially providing cover but its the right thing to do. Doing nothing would be a disaster.
As always I enjoy the discussion.
Totally agree. Problem is that when 50% of people are on the government dole its hard to get them to care about a business environment.
There’s a very fine line between helping and enabling. Kind of like when parents unwittingly demotivate their kids by helping them out too much. :)
It will be interesting watching the Fed try to unwind its massive balance sheet. And I am very concerned that the market seems to be driven more now by the Fed than fundamentals.
We are rapidly closing in on a (nominal) $17 trillion national debt. Yet another disaster in the making.
One of the most ironic things I have ever seen was in San Francisco in the late 90’s. out by Pier 39 there used to be floating platforms where the seals would sun themselves and tourists could watch them from close range. There were signs that said, “please don’t feed the seals as they will become dependent on acquiring food here and will not be able to hunt food as is their nature.”
I posted a chart of corproate earnings and the S&P 500 index and its a pretty good correlation. Companies are making money. Ours just posted out best quarter in five years.
Analysis from IHS:
The United States adds 162,000 jobs in July, and the unemployment rate falls to 7.4%.
Establishment employment growth in July was 162,000. While lagging previous months slightly, this performance does not provide enough new information to materially change the IHS US outlook for a slow acceleration of economic growth over the next few quarters.
Just over one-quarter of this growth came from retailers, suggesting that the current pace of consumer spending remains sustainable.
The headline unemployment rate fell from 7.6% to 7.4%. Employment levels from the household survey increased by 227,000, but the size of the labor force fell by 37,000, driving the decline in the unemployment rate.
A major contributor to this decline in the labor force came from those with a bachelors degree or higher (and who are at least 25 years old). While other segments saw an increase, this segment declined by 293,000 in July, although it remains 1.5 million higher than in July 2012. It is too soon to say if this is the beginning of a significant trend, but it bears watching going forward.
The average workweek declined by 0.1 hour, and average hourly earnings for all employees fell 2 cents to $23.98. Compared with July 2012, average hourly earnings and average weekly earnings have both increased by 1.9%.
This report muddies the debate among economic pundits regarding when the Federal Reserve might begin its tapering of its current QE program. The 0.2-percentage-point decline in the unemployment rate adds credence to a sooner vs. later argument, but other mitigating factorsa reduced labor force and near-term weakness in average hours and earningsargue for starting this tapering in 2014.
Overall, this report is consistent with the IHS outlook for a slow acceleration of growth over the next few quarters. The report is broadly consistent with the three earlier reports that show monthly employment gains of 150,000200,000. The report also does little to resolve the debate about the prospective timing of when the current QE program may be tapered.
From a macroeconomic perspective, we have seen two quarters of slowly accelerating growth from the fourth-quarter 2012 nadir of 0.1% to the second quarter’s 1.7%. This report suggests that the second half of 2013 will see a continuation of this trend: faster growth than 1.7%, but not enough to suggest that the economy has fully recovered from the recession that ended about four years ago.
The 0.2-percentage-point decline in the unemployment rate adds to the argument that the Fed might begin its tapering program in the second half of 2013. However, we note that the data are frequently revised, and that other mitigating data exist in this report that could contradict the apparent strength of the 0.2-point decline. Cogent arguments still exist for a delay of the onset of this tapering until 2014, which remains our IHS forecast.
While average hourly earnings were down slightly in July, overall earnings are growing slightly faster than inflation (as measured by the personal consumption deflator), suggesting that the current consumer spending contribution to economic growth will continue.
The report also provides some signposts to look for next month. It is unclear what individuals motivations are for dropping out of the labor force, but discouragement at finding a job certainly does not support faster economic growth. The fact that those with college degrees contributed so significantly to this result bears watching over the next few reports. If this decline continues, it would represent a sea change to the longer-term outlook. However, these data are very volatile, and it really is too soon to make any significant inferences.