• Once again, a week of worse than expected economic data punctuated by another better than expected non-farm payroll report from the government
  • ADP private sector payroll report was slightly below estimates
  • 5,000 manufacturing jobs lost – 3rd consecutive monthly decline
  • Unemployment rate dropped
  • Labor participation rate up to 62.9 – .2% above lowest point
  • Large sector of labor force still comprised of older workers
  • Teens, twenties and thirties are at all-time lows
  • Older Americans want part-time jobs, so increase of part-time jobs contribute to increase in all jobs
  • Given the strong government jobs number, the media is discounting all the weak data, including GDP, productivity, consumer spending and industrial production
  • The jobs we’re creating do not reflect economic strength
  • The weekly unemployment numbers are hovering at 42-year lows
  • Does anyone believe that this is the strongest economy in 42 years?
  • The hiring numbers are suspect to begin with because of the government’s assumptions
  • The Trade Deficit dropped not because our exports surged, but because out imports plunged
  • Our economy is too weak to support a greater number of imports
  • A closer look at the data behind the government jobs number actually supports the rest of the weak economic data
  • Personal Income and Spending on the month missed estimates
  • May Manufacturing PMI dropped slightly
  • April Factory Orders fell by more than expected
  • Year over year, orders are down 6.4%
  • 6th consecutive month that factory orders have been down year over year
  • This has only happened in America during a recession
  • Mortgage applications fell sharply on the week – 7.6% decline, led by a 12% decline in re-fi’s
  • May Services PMI fell to 56.2 – lowest level since January
  • ISM Non-Manufacturing Index dropped to 55.7 – the lowest level of the year
  • The revision to Q1 Productivity – 3.1% decline
  • We also had a decline in 2014 Q4
  • Corporate profits plunged 5.9% in Q1
  • Unit Labor Costs surged by 6.7% – this does not represent wages
  • All this data predicts future layoffs
  • The Fed knows this, so they are reluctant to raise rates
  • The Bloomberg Weekly Consumer Comfort Index fell to 42.5 the 8th consecutive decline – the first time in its 30 – year history
  • The Dow continued to decline on the jobs report
  • NASDAQ still hanging in
  • Margin debt is at a record high
  • The dollar was stronger on the week
  • The euro finished positive
  • By next year European inflation will force the Bundesbank to retreat from QE
  • Gold was down on the week, as euro strength signals QE less likely in Europe
  • Expectations of rising interest rates have been suppressing gold, but when reality rears its ugly head, the sellers will be gone and the buyers will be out in full force