>"Fear of Bad Employment Reports
>http://www.j-bradford-delong.net/movable_type/2003_archives/cat_policy_fed.html
>
>This morning's employment report reduces Doug Henwood to a state of
>gibbering terror: Doug Henwood: This morning's U.S. employment
>report sucked. The survey of employers showed a loss of 93,000 jobs,
>when flat to slightly up was a reasonable expectation. We've now had
>seven consecutive months of job loss, something we've never seen
>outside a recession. The workweek was short and almost every
>industrial sector shed jobs. The survey of households showed a
>shrinkage in the labor force - the entire reason for the decline in
>unemployment from 6.2% to 6.1%. The share of the adult population
>working was flat, and remains at a low for this cycle. People are
>buying stuff, but it's not with their paychecks - it's all tax
>refunds and mortgage refinancing. If the job market doesn't recover
>soon, we're in trouble. What Doug fears is that sometime soon
>households will change their states of mind: they will think that
>the risk of losing and then being without a job, or being unable to
>find anything other than a crappy job, is too high; and thus that
>they need to cut back on their spending significantly in order to
>build up their buffer stocks of savings..."
I agree with the last part, but I'm also worried that the U.S. economy has come down with a case of accumlation crisis, which is being treated with intense speedup and cost-cutting and with huge tax breaks for the rich. If employment doesn't recover soon, there will be nothing to compensate for the fading stimulis of cashout refi and tax refunds, and consumption could finally have its recession. Positive GDP and falling employment looks like what stock market technicians call a negative divergence or nonconfirmation - like when the averages are rising but the advance/decline line is falling. Bad omen. All that would change with a few six-figure positive monthly job figures.
Doug