Investors -- The Fed -- The Job Report -- No Recession Yet -- January 5, 2023

Data points:

• Dow down 400 points after jobs report;
• JPow telegraphed no rate decrease in 2023;
• he most likely had job data at time of his statement

From CNBC:

• ADP: jobs added in December, 2022: 235,000
• forecast: 150,000 new jobs; a huge miss;
• November numbers unrevised; 127,000 jobs added
• questions: adjusted? seasonal hires? offset anticipated job losses in 2023?
• if this is not seasonal but similar numbers hold through 2023, it suggests exactly how much "free money" and fear of Covid kept folks from returning to work 
• fear of Covid keeping folks from returning to work much less a factor than "free money"
  
• weekly jobless claims, also came in less than expectations
• JOLTS: job market remained strong

Note: from Reuters:

The ADP report, jointly developed with the Stanford Digital Economy Lab, was published ahead of the Labor Department's Bureau of Labor Statistics' more comprehensive and closely watched employment report for December on Friday. It has been a poor predictor of private payrolls in the BLS employment report.

Jobless claims:

• 204,000
• a drop of 19,000
• from The Washington Examiner:

While the number of new jobless claims has remained low enough to avert fear that the country is already in the throes of a recession, most economists anticipate that the U.S. economy will enter a Fed-induced recession at some point in the new year. That is because rate hikes can take a while to filter through the broader economy and create recessionary conditions and job losses.

It is expected that as the rate hikes begin to ripple across the economy, jobless claims begin to tick up, and then monthly jobs reports will begin to turn negative.

Thoughts on investing: unchanged.