Unenjoyment Day

4.7% and 235,000 never looked so average. I got up early to watch the talking heads spin their political views all over the number. To think hiring managers have ramped up their actions in a policy environment that has been thrown into flux is new wave economic thinking devoid of foundation.

The focus should have moved away from the Employment data several years ago. Retail Sales should be the market blistering data drop of the month. And yet. Our warning over the last month has been the abrupt drop in retail activity. The sector posted a glaring negative in the otherwise standard advance. The "late tax return" meme holds a tad of water but should be gone by the March print and then, well some peeps may actually owe.

The cognoscenti wasted no time in tossing off rate levels 100s of bips higher than the prevailing. FI practitioners were once again portrayed as hapless rubes mesmerized by the Fed's sleight of hand. Equity boys, on the other hand, are brilz. The incredible heavy force of Europe that has been weighing on the term structure, and is now shifting, was never mentioned. The Fed, of course, was "behind" the "curve."

We still contend it is the SHAPE of that curve that needs adjusting more than the LEVEL of rates. The ghost of the 70s/80s  rates anomaly still haunts people's views 2 generations later. Low does not mean "easy" and Higher does not automatically equate to tighter.

Leave a Reply

Your email address will not be published. Required fields are marked *