Positive Jobs Data Leads to Cautious Optimism

Harsh winter weather is expected to have hit the operations of Canadian National Railway Co. in the first quarter while leaving its smaller rival, Canadian Pacific Railway Ltd., largely unscathed. Thomas Wadewitz, JPMorgan analyst, said he expected one less operating day this year and the winter weather to drag on the volumes of most major railways by about a percentage point in the first quarter.

The Pragmatic Capitalist submits: A smattering of analyst opinions on the jobs report appears pretty mixed. I think the main takeaway here is that this is not a huge market moving event. The improvement is meager and there is A LOT of work yet to be done before we can claim a recovery:

The Pragmatic Capitalist submits: 1) Total job losses were just 35K versus expectations of -50K. We mentioned that jobs growth would return in Q1 and there is little doubt in my mind that this number would have been in the green were it not for the Winter storms. Of course, the more important aspect of this jobs rebound is to keep it in perspective. We lost 7MM+ jobs during the course of this recession.

In the aftermath of last week's decidedly weak unemployment report (pre-spun to appear strong while ignoring the major drop in average weekly hours worked, which would have resulted in a massive drop in payrolls had total demand for labor stayed constant from March), many were looking for some confirmation, or denial, from today's Job Openings and Labor Turnover (JOLTS) survey which provides the labor breakdown by new job openings, hires, separations, quits and layo

As we said a week ago in "Scapegoating Nemo", it was only a matter of time before Wall Street's heroic band of permabullish lemmings used a snow storm in the middle of, gasp, winter, as a "valid" excuse to justify why an economy priced to central planning-perfection may deviate slightly from a path that has missed every major upside inflection point in the past four years (but... but, there is always a reason... if only for the Fed to print).

Prieur du Plessis submits: Analysts expect that the US non-farm payrolls to be published later today will show the US economy continued to shed jobs in July. Yes, initial jobless claims published yesterday were up on the week before. Our analysis differs, though.

Friday's disappointing Non-Farm Payrolls report surprised many on Wall Street. It was not only the pie-in-the-sky optimists who were stunned, but also more realistic prognosticators such as yours truly. I thought the report would indicate flat job growth due to seasonal hiring. While an upward revision due to seasonal hiring may be in the cards, it does not appear that the holidays were merry for many aspiring workers. It just may be that the revised positive November data is all she wrote for temporary holiday employment. That remains to be seen.