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Friday, June 5, 2009
US Jobs Report
The U.S. economy shed “only” 345,000 jobs in May, the Labor Department said this morning. We forecast Wednesday that today’s employment gauge would beat expectations, but wow… this number smashed the Street’s guess of 520,000. Last month’s loss is the smallest since it all hit the fan last September. May’s number establishes a trend for 2009, too. The jobs scene is far from rosy, but at least it doesn’t seem to be getting worse… not yet anyway.
But the details of today’s jobs report aren’t quite as rosy as the headline number. The unemployment rate rose to 9.4%, notably higher than the expected 9.2%. In other words, the unemployed are not being rehired. While the rate of firings cooled off, the bread line is just getting longer and longer. 9.4% is the highest rate since 1983.And it’s funny how the dark science of charting works. The chart above would lead you to believe the jobs scene has bottomed… but does this one inspire the same confidence?
More disturbing details:
- Over 6 million people have lost their job since the recession officially began in December 2007
- The “long-term unemployed” -- those out of work for six months or more -- now exceed a record 4 million. Many of these “discouraged” people are not counted toward the official unemployment rate
- 9.1 million people are working part time because they can’t find a full-time gig -- also not counted as officially unemployed.
Gold & Silver Short Term Top?
Inter-Market Dynamics
In past market wraps I have discussed various inter-market relationships and the fact that some of them have changed, while others keep oscillating back and forth: sometimes tracking one another in the same direction; and at other times moving inversely to each other.
These changing inter-market dynamics are the signature of a paradigm shift that is taking place: the death of paper money (and related assets) and the re-emergence of gold and silver as the ultimate store of purchasing power and value over time. (more)
Daily Currency Analysis
EUR/US$
The Euro rallied to levels above 1.42 against the dollar in early Europe on Thursday, but was unable to sustain the gains and dipped back towards the 1.4150 level ahead of the European interest rate decisions.
The ECB left interest rates on hold at 1.00% following the latest council meeting which was in line with market expectations. At the press conference following the decision, President Trichet was slightly more optimistic over the economy than in recent comments. The forecasts for 2009 were still downgraded by the bank with an estimate that GDP would decline by 5.1% for 2009 with a marginal return to growth for 2010.
The ECB confirmed that it would by EUR60bn in covered bonds with Trichet refusing to make further comments on the possibility of additional purchases. (more)
Barchart.com U.S. Morning Call for Friday, June 5, 2009
Overnight Developments
The European DJ Stoxx 50 this morning is up +0.87% and June S&Ps are up +4.90 points (+0.52%). The Asia-Pacific stock markets today closed mostly higher with Japan (+1.02%), Hong Kong (+0.96%), China (-0.49%), Taiwan (-0.28%), Australia (+0.93%), Singapore (+1.42%), South Korea (+1.15%), India (+0.63%). (more)
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