Job Losses Approach 700,000 For December. We Will Likely See Well Beyond 1,000,000 Monthly Losses Before The Economy Bottoms
It has been quite a few years since we have talked of this but unemployment claims are not a useful data point to determine the future recovery or rally in the stock market. As we wrote before, the U.S. was pushing out serious job losses in the closest parallel for anyone still alive - that being the 73-74 debacle. Yet, the stock market had already bottomed.
The anticipated job losses announced today are horrible but this extremely weak stock market rally is in jeopardy for other reasons. It is conveniently reported that correlation to the unemployment numbers equals causation for equity market weakness this morning but the reality is much different as smart traders know. We had a rally of about ten percent in four days. That is annualized at reaching Dow 50,000+ by the end of the year. And, that rally happened when many happy sellers were off for the holiday. Predicting short term movements is as much art as science but I would put it at reasonably high odds we are going to break the November lows. There is way too much reckless behavior developing in the stock market again. The only question is if we break it by 3% or 30%. Were I a gambling man, and I am not so take this for what it's worth, I would bet the November lows hold for now. ie, That we are going to see a stabilization or rally after shorter term weakness as much of the data finally supports a market stabilization for the first time since this debacle started.
These unemployment numbers are horrible. And, it should sicken everyone to see all of this unfold because much of it was avoidable. And, now mostly innocent people across the globe will pay with their livelihood.
The anticipated job losses announced today are horrible but this extremely weak stock market rally is in jeopardy for other reasons. It is conveniently reported that correlation to the unemployment numbers equals causation for equity market weakness this morning but the reality is much different as smart traders know. We had a rally of about ten percent in four days. That is annualized at reaching Dow 50,000+ by the end of the year. And, that rally happened when many happy sellers were off for the holiday. Predicting short term movements is as much art as science but I would put it at reasonably high odds we are going to break the November lows. There is way too much reckless behavior developing in the stock market again. The only question is if we break it by 3% or 30%. Were I a gambling man, and I am not so take this for what it's worth, I would bet the November lows hold for now. ie, That we are going to see a stabilization or rally after shorter term weakness as much of the data finally supports a market stabilization for the first time since this debacle started.
These unemployment numbers are horrible. And, it should sicken everyone to see all of this unfold because much of it was avoidable. And, now mostly innocent people across the globe will pay with their livelihood.
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