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Jobs: A Scarce Commodity

June 1, 2012 – 5:11 pm

After yesterday’s weaker than expected ADP report on jobs most experts still expected well over a 100,000 new jobs for May from the official report out this morning and they were wrong. Not only were the experts wrong they missed by a huge margin. A total of 69,000 jobs were produced but also new jobs reported in the two previous months were reduced. It was the smallest number of job increases in a year. The unemployment rate rose to 8.2% from 8.1% and even that is not right as about 300,000 unemployment recipients fell off the rolls which means they do not get counted as unemployed. There is no way that this report can be manipulated to be positive.

In other news personal income was up .2% and consumer spending up .3%; both numbers were at or a little better than expected. Inflation came in a little less than expected as well.

Oil has fallen sharply for the Month of May and this morning it tumbled further to $84.10 per barrel. That will help both the inflation numbers and consumer spending looking forward.

But this morning jobs are topic number one. It appears that the continuing EU problem, while not pushing the U.S. into recession, certainly has frightened employers enough to slow their hiring. Add China’s and India’s slowing growth to the mix and it shouldn’t surprise anyone that the U.S. is struggling to maintain momentum in its own economy. The lack of jobs certainly has put QE3 from the Fed back on the table.

Good Trading
Steve Peasley

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