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Jobs, Debt and Growth

September 6, 2011 – 5:08 pm

The Jobs report on Friday brought a screeching halt to the one week rally as no jobs were produced for the month of August. This morning, Tuesday, traders continue the slide started on Friday as worry turns to the strength of European banks. The worry is that they may not be strong enough to handle all the sovereign debt they took on and the governments in Europe are doing very little about it. At least that is the assumption the stock market is making.

The economic data, while not strong, is showing a mixed signal of stabilization. Some data points are stronger than others. Retail sales were surprising stronger than expected last week meaning the consumer may be opening his or her wallet just a little. Our economy runs on what the consumer does. It also helps that corporate America is financially fit with money they can easily spend on capital goods, mergers, stock buy backs and dividend increases. Between corporations and the consumer they could, if motivated to do so, end any thought of a double dip recession.

There will be little economic news this week but a few reports will be released. For instance this morning the ISM for the manufacturing sector in our economy rose to 53.3 much better than expected which was 51 and better than last months 52.7. Anything above 50 is growth and below is shrinkage.

Good Trading,

Steve Peasley

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