The jobs report came in with a good headline number at 255,000. Wall Street went ballistic and even noticed a twinge of euphoria Friday morning. Hold the phone, I’m concerned it isn’t what it seems. You’ve seen me flat out say from time to time I think some fundamental number is a complete fabrication. I think this number is on the level. But I also think they got there by the most creative levels of accounting gimmickry.
Another week, another terror attack. After rising on Thursday, the VIX dropped back again on Friday. Last week I told you the market behaves like a little kid who won’t take all of the news to heart until it becomes personal. The key point here is for everyone to realize what eventually happens when society comes under attack--the stock market comes unglued. Want more proof? Let’s go back 100 years.
Markets have thrown a curve ball, as not only have they recovered from the Brexit losses, but the S&P 500 is on the cusp of a new all-time high. It makes world markets very complex. Who is really driving the bus? The SPX could be at all-time highs but the SSE remains 42% off its 2015 high and only 13% off its January low. The DAX remains light years from the 2015 top while the FTSE has been able to make it to the drop zone from last August where all the trouble really started.
Two gigantic weeks are coming up. Up to bat first is Washington and Fed Chair Janet Yellen. The Fed knows it’s an absolute absurdity to raise rates in an economy that just created 38,000 jobs. But do you want to tell me they have their collective heads in the sand about an economy barely staying above water at 0.8% GDP?