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Unemployment Blues

July 5, 2011 – 4:56 pm

This is going to be a light week for economic statistics until Friday.
Tomorrow we will get the May Factory Order number and the experts
are calling for growth of 1% from a fall in April of 1.2%. But the rest
of the week will be a desert of statistics both from the government
and corporate earnings.

That changes on Friday when the all important market mover, the
jobs report, for June is released. It appears that those that
think they know expect 100,000 new jobs. That is up from a very
weak 54,000 last month. The unemployment rates, which is a separate
report from the jobs report, called the ‘Nonfarm Payrolls’ is
expected to remain at 9.1%. That is not very good. We need at
least 150,000 new jobs every month just to keep up with the
work force increase. We will need far more than that to push
the unemployed rate down.

I think it will be a slow long hard effort to gain
back those jobs. At some point there will be months in which
job growth will accelerate but I just do not believe it will
be soon and when it does happen it won’t be enough. For it
to be strong we would need the housing market to be part of the
effort and that recovery is several years away.

Good Trading
Steve Peasley

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