Waiting on Employment Numbers – UPDATE

Wow–528,000 new jobs. Of course interest rates shot up–by 10 basis points and stocks dropped. Could be an interesting day (aren’t they all?).

Once again we await on important economic stat–seems like there is something every week.

The consensus forecast is an addition of 258,000 new jobs in July with an unemployment rate remains flat at 3.6%.

Whether this number runs hot or if it comes in short it will not change anything I personally do investment wise, but it will give cover to future Fed moves–if the number runs hot the Fed has one more arrow in the quiver to continue rate hikes. If the number is soft it is a chance to soften the tone of their statements and potentially pave the way for interest rate hikes of say 50 basis points or just 25 basis points late in the year.

We’ll know more in 15 minutes.

10 thoughts on “Waiting on Employment Numbers – UPDATE”

  1. Big number means .75 rate hike in September. The 2 year has already priced it in. I will not be surprised to see the fed funds rate at 4%+. Not good for bonds or preferreds. ATB

    1. TimH–I wouldn’t be reacting to this number with any selling. Over time they will do just fine–I am more apt to act on any weakness with buying–I still have 20% cash and I want more (another 10%) of that invested.

      1. Tim – I appreciate your thoughts and site. I’m a trader and was selling into this rally and I’m about 60% cash as of today. But I can get fully invested quickly through ETF’S. I will wait until we get oversold again to add. The next 60 days are usually volital and prices lower and I think it’s a good time to be patient with the fed so aggressive. I think rates go higher than the bond market has priced in at the moment. As for bonds ( IEF & TLT) I will wait until the fed is done raising rates. ATB Tim

        1. Hi Tim–ok–so for you you may be different–I hate to see folks that are long term investors selling out on a scare.

          1. Not sure if anyone here noticed but the 3m/10y inverted briefly after hours 8-2 and early 8-3 according to CNBC data.

            1. Tim–I had not noticed as I typically watch the 2yr/10yr, but that is interesting although I am not aware of the history for such as thing to happen and the longer term ramifications.

              1. Tim – I watch both. The 2y/10y gives you a long lead time warning. When 3m/10y inverts we are close to a recession. It should invert again after the next fed meeting.

                1. Tim–I will watch it and see what happens over the months ahead. Thanks for your input and contribution to the discussions.

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