Grim US Jobs Market Signals Looming Recession

Grim US Jobs Market Signals Looming Recession

Grim US Jobs Market Signals Looming Recession


Recession signals are growing more especially in the US jobs market

The NFPs (non-farm payrolls) report last week contained some very worrying data, even as the unemployment rate dropped to a 9 year low of 4.7%. Many thousands of Americans left the work force and were not counted as unemployed.

Even worse, manufacturing jobs fell, possibly signaling a recession in the US.

The decline in goods-producing jobs was last seen before significant economic slowdowns, including November 1969, May 1974, December 1979, October 1989, November 2000 and May 2007 according to the data.

Each 1 of these frames presaged a recession just a few months later, the average being 5 months according to the data.

Slowing productivity could also threaten pensions and health programs for the elderly, says Alan Greenspan, former Chairman of the Federal Reserve.

Productivity, the measure of hourly output per worker, has declined as businesses have slowed their investment in plant and equipment to boost efficiency. And, the massive increase in private and public sector debt that has helped to boost the economy in the past is now dragging on its growth.

Mr. Greenspan says governments are going to confront another major financial crisis as economies struggle to pay for entitlement programs.

“Entitlements are crowding out savings and hence, capital investment. Capital investment is the critical issue in productivity growth and productivity growth in turn is the crucial issue in economic growth,” he says. “We’re running at the end of this period to a state of disaster unless we turn it around.”

Tuesday, the US major stock market averages finished at: DJIA +19.59 at 17939.92, NAS Comp -6.96 at 4961.76, S&P 500 +2.81 at 2112.22

Volume: Trade was above average with about 845-M/shares traded in the NYSE:

  • Russell 2000 +3.9% YTD
  • S&P 500 +3.3% YTD
  • DJIA +3.0% YTD
  • NAS Comp -0.9% YTD
HeffX-LTN Analysis for DIA: Overall Short Intermediate Long
Bullish (0.32) Bullish (0.31) Bullish (0.27) Bullish (0.38)
HeffX-LTNAnalysis for SPY: Overall Short Intermediate Long
Neutral (0.19) Neutral (0.08) Neutral (0.19) Bullish (0.29)
HeffX-LTN Analysis for QQQ:  Overall Short Intermediate Long
Neutral (0.22) Bullish (0.33) Neutral (0.19) Neutral (0.14)
HeffX-LTN Analysis for VXX:  Overall Short Intermediate Long
Bearish (-0.42) Very Bearish (-0.51) Very Bearish (-0.57) Neutral (-0.17)

Stay tuned…

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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