August 2nd, 2013

The major news item today had to do with the latest jobs report.  The US economy added about 162,000 jobs, however this fell short of expectations of 200,000.  Additionally, average hourly earnings fell 0.1% in July, which is the first decline since October 2012.  Finally, US job numbers for May and June were revised downward, painting an overall negative picture of the employment scenario.

Furthermore, 69% of the jobs created in April, May, and June were in the 3 lowest paying sectors in the economy - Retail, Food Service, and Administrative/Janitorial.  Unemployment did fall to 7.4%, however Unemployment does not include every person actually out of work, it only includes those who are actively filing for and receiving unemployment benefits.  Considering the massive influx of workers into low paying jobs, and it's no wonder GDP hasn't been growing at the rate it "should" be.  Add in the fact that we didn't add as many jobs as expected, and one has to wonder where we're going next.  Has this truly become a nation of kings and paupers?

The markets, despite the negative jobs news, were up today on strong earnings from a variety of companies.  Today winds down the end of earnings season though, so expect reality to "set in" beginning next week when the negative jobs numbers finally make their way into Wall Street.

And finally, the 5 minute chart of the DOW...

The market opened up and had a HUGE drop to start the day.  Beginning around 9:50, the market staged a small come back until 10:30, then dipped again going into 11:00.  From about 11:00 AM through the rest of the day, the market steadily rose and actually closed at an all-time historical high at the end of the trading day.