U.S. Jobs Report Could Be Tipping Point

Like a bridge over troubled water, the U.S. job market could be finally caving in. At least that is what a raft of recently released employment indicators may be suggesting.

- the Rasmussen employment index, a measure of workers’ views on job security, fell in June to a record low of 78.6
- TrimTabs, which extrapolates U.S. Treasury tax collections, estimates a drop of 133,000 jobs occurred in June (and adds that the acceleration in losses in the last two weeks of the month suggests a plunge of 300,000 jobs in July).
- Automatic Data Processing (ADP), a major payroll processing company, reported a loss of 79,000 private-sector jobs in June (having reported a 142,000 net increase in jobs up to May).

Tomorrow, the Bureau of Labor Statistics [BLS] releases its June numbers on non-farm payrolls. Last heard, the consensus projection was for 55,000 job losses -- which seems to be on the low side considering the weakness in the Rasmussen, TrimTabs, and ADP stats (which are known to foreshadow BLS numbers). Indeed, today’s sell-off in the U.S. stock market appears to be anticipating the overshoot.

If the actual losses come in substantially higher than expected, financial markets may continue selling off. In fact, some analysts, like Kathy Lien, expect the reaction could be rather severe: she notes: “If payrolls come any where near -90k, the dollar would collapse against the Euro as the market questions the viability of a 2008 rate hike by the Federal Reserve.”

 

Comments

[iThinkBig]

Just lovely. Do you know what stinks? Our nation got out of depression by increasing defense spending to 75% of our GDP. Thank Emporer Hirohito for that. But we can't learn from history and vastly increase energy independance spending right now and at least aptly tackle one major problem tilting the nation towards a new depression?

It's an election year and staying in power is more important then the nation itself! One guy here on Seeking Alpha said he was tired of hearing about cyclical human nature. Well, it's really the top-level driver for our nation and behavioral patterns (roughly blocks of 20 years and 100 year super-cycle) which dictate wise investment. Those whom ignore history are doomed to repeat it. Great job boneheads in Washington and NYC Financial System! Don't tell me you were smart enough to know how the line between greed and treason!

Alexander Hamilton was right, when he stated in 1790 that when banking and government collude, American citizens would wake up homeless and penniless. So I myself am frustrated by our repeated, flawed genetics as a species. Isn't the invention of the spreadsheet and databases of knowledge suppose to mean something? Attempting to educate people about this, a waste of my time?!? Yours?!?! As a species, we really always think that our generation is different from that of 100 years ago, 1,000 years ago?!? Yeah, we're different we took history out of the classroom and called it social science so we could learn to become sensitive. Those whom give a damn better get active and get into Washington to serve. I myself am running for Congress in 2012. Wait until they get a load of me up on the hill!

[Whidbey.]

The Hill will not like you ThnkBig; you are too like the citizens already hiding there.

Dear Larry by now you know down 68,000 but if you looked carefully, there were 28,000 government new hires in there, and lots of seasonal entertainment jobs. The real unemployment was closer to 120,000 and without seasonal corrections 150,000. Too late to worry. The price of gas has undone the US consumer and he is going to stop, which means orders stop, and loan stop, and things go to nasty or worse. Yes, employment matters and its is not good, but the continuing claims are less than 420,000 so the boys took things very well, having found a bright spot to point to in the dimming lights. But it was not good and will go down hill for some months right into the election of Obama, and then things go to hell in ways we never imagined possible.

[WAKEUP]

I posted my outlook on this still-developing catastrophe, about a year ago. I said, then, that we were headed for Hell, in a handbasket. No one believed me (then.) Look, up ahead, at the crossroads! Is that the Twilight Zone? Nope, it's Hell.