Jobs Data is Bad, but Is It Bad Enough?

As you probably know, the economy shed another 95,000 workers. It seems some media are puzzled as to why the unemployment rate remained unchanged at 9.6%, as one put it ,

"The unemployment rate unexpectedly held at 9.6 percent."


As I mentioned a few days ago, people are falling off extended benefits and are falling into the murky shadow of U6, which the media act as if they have never heard of. Not surprisingly, the U6 rate rose from 16.7 to an astounding 17.1% this report. That's why U3 headline rate didn't change.


So what's got futures dropping and the dollar rising against the Euro as well as a few other currencies? This is bad news, this should guarantee a second round of QE? Goldman Sachs said yesterday that QE2 at at least 500 billion and from what I understood, nearly a trillion dollars is pretty much already priced into the market. That means if we don't get it, beware the sell-off of sell-offs. So the data, "may" not be as bad as they hoped for a guaranteed round of QE2 and what appears to be happening is the market discounting the possibility.


This is why my post last night stuck to the facts, the market is clearly bearish, but why I'd attempt no guesses as to what smart money may or may not have known because this one was not black and white, the two colors were not even on the palette, it was pure shades of grey.


We'll se what happens, but the Euro had a nice rally going this a.m. and it's now giving up most of that one hour candle spike and futures have fallen way off-another reason I largely ignore extended hours trading.