August Jobs Report: The Goldilocks Number -- September 2, 2016

Updates

Later, 8:52 a.m. Central Time: I'm just waiting to see if BRK-B goes over $151. [Remember: this is not an investment blog.]

Later, 7:59 a.m. Central Time: this might be the "Goldilocks number." The 151,000 is "bad enough" to keep the Fed from raising rates, but good enough for folks to say this is the 71st consecutive month of job gains, and unemployment remains steady (and some would say, we are full employment, regardless). If the market has a really, really great day -- I will argue that the jobs report for August "hit" the Goldilocks number.

If it's a bad day on Wall Street, well, it must have been something else.

By the way, the July unemployment figure was revised upward. A revision of a monthly unemployment figure is said to be "very rare." Not for this administration. 

Original Post

 

Previously posted, but an important post that runs risk of being lost if not posted as a stand-alone.

August jobs data: the spinmeisters will call this a great report. In fact, it's pretty dismal. US adds 151,000 jobs (before the Obama administration, the magic number was 200,000: adding less than 200,000 jobs in any month was a sign of economic stagnation. Sometime during the Obama administration, the major business news outlets moved the goalposts).  Full employment is the headline: unemployment rate unchanged at 4.9%. Let's see how Yahoo!Finance spins it:

The US labor market disappointed in August.

US companies added just 151,000 payrolls during the month, missing expectations for 180,000 payrolls. 

While the numbers were lighter than expected, it reflects the 71st consecutive month of job gains, which is already the longest streak on record. [MORE SPIN]

The unemployment rate stood at 4.9% in August, which was higher than the 4.8% forecast by economists. Notably, the July unemployment rate was revised up to 4.9% from an earlier estimate of 4.8%.

Janet Yellen? At most: "one and done" and even that "one" may be delayed.

Even the expected 180,000 jobs would have been below the 200,000 threshold. Just saying.

How did the market react. Futures pointed to a slightly higher opening, maybe 30 points in the Dow 30, prior to the jobs report. If the market opens higher, it's because traders think the jobs report will delay "one and done"; if the market opens lower, traders are hunkering down for a two-fer: a worsening economy, and despite that, the Fed still talks about raising the rate sooner than later. (It's all relative: the Fed -- or at least the media -- has been talking about raising rates for the past five years, it seems.) Common sense would tell us that the jobs report will boost the market today.

So let's see: futures are now up almost 50 points.