The July jobs number added further confusion to what is already one of the most challenging economic environments for investors in decades. To start with, there was a large disparity between the Bureau of Labor Statistics report and a much lower household survey report. The high number of new jobs didn’t synch with the rising number of layoff announcements by large tech companies but those layoffs will work themselves into the data over the next few months. Strong employment also seems inconsistent with the signs of slowdown resulting in sharply lower commodity prices. It may be too much to expect all of the data to line up but we are clearly seeing signs that the economy is slowing. Monetary policy takes time to work and most likely we will see unemployment drift upward over the rest of the year.
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