Jobs Report Better than Expected

The market continues to run on signs that economy is recovering. A good jobs report, showing 4.8 million jobs were added in May and a key economic indicator, the ISM indicator, came in solidly in expansion territory.

The market wants to go up, likely thanks to the hordes of cash the Government and Federal Reserve are supplying, and seizes on any good news to rally. How much cash/rope do we have before the lifeline runs out?

Considering interest rates are near record lows and the Government controls the money printing presses, it is likely quite a bit. We are watching rates for any signs of fear or lack of confidence in the mountains of debt, but right now it is nowhere to be found.

A caution on reading too much into the monthly jobs report. It's published the first Tuesday of each month and while continuous growth is always good, the number needs to be viewed across quarters and half-years. Also, seasonality plays a large role in the jobs numbers and not all jobs are the same. So, that 4.8 million jobs were added last month during a pandemic is encouraging. But don't make a stock pick on it.

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