Unemployment rate stayed the same at 7.6%.
175,000 jobs created -- modestly better than expected.
Manufacturing jobs contracted 3 consecutive months. Not good!
April jobs revised DOWN. Not good!
But stocks are higher. Wall St traders trade headlines, not fundamentals.
The bubble builds:
"...the most severe market losses on record have been accompanied by aggressive /Fed/ easing. Without question, quantitative easing has been very effective in suppressing spikes in risk premiums in recent years. More recently, it has been effective in removing any perception that stocks have risk and creating the impression that easy money is enough to override every possible economic or financial concern. But that is where perception has moved beyond reality. There is no evidence in the historical record for such optimism...It is superstition to believe that monetary easing is a panacea. Investors who recognize (actually, simply remember) this now are likely to fare better than those who are forced to relearn it later.
Needless to say, all of this will be summarily ignored by speculators who have been rewarded by the strategy of following the Fed in a mature, overvalued, overbought, overbullish, unfinished half-cycle that recently hit new highs."
"… the last two 50% market declines – both the 2001-2002 plunge and the 2008-2009 plunge – occurred in environments of aggressive, persistent Federal Reserve easing."
John Hussman, PhD
