US NFP – bad news is good news…again

It’s that time of the month again when we review the all important US non farm payrolls jobs report – the bellwether for the US economy.  Headline - 223K new jobs (just below expectations of 228K) and unemployment down to 5.4% (from 5.5%).  Reading the headlines you could be excused for thinking there were 2 sets of readings – Wall Street mainstream press minions scream ‘everything is awesome’ and say very definitely, surely, probably this means an interest rate rise in September (as now conveniently too close to June).  Others seemed to have looked behind the headline and saw that March was revised down even lower to just 85,000, its weakest since June 2012.  This was accompanied by very weak average hourly earnings, up just 0.1% and March revised down also to 0.2%.  And whilst the unemployment rate dropped, you can look no further to a yet again higher (highest % since 1977) number of Americans NOT even participating in the labour force at 93.194 million.  Easiest way to improve your unemployment rate is not counting those who have given up…  And don’t blame all those rich retiring baby boomers.  They were the bulk of new jobs!  In fact the vast majority of the 223K new jobs were part time and to over 54’s – you know, real nation building stuff...  There are actually 4m fewer 25-54 aged workers now than just before the GFC.  So not surprisingly Wall Street surged on this bad news (especially combined with a raft of poor economic data last week – listen here for a summary) as it means rates will stay near zero, the free money game continues, and the bubble is blown up just that little bit more…  Are you ready for the pop?