That's how investment legend Mohamed El-Erian described today's Jobs Report, which was a pleasant change indeed. According to the Department of Labor, America produced 117 thousand new jobs in July, well ahead of the expected 60-80 thousand. Subtracting the continuing losses in government jobs, the private sector produced 154 thousand. Even better, the poor jobs report in May and June were upgraded by another 56 thousand.
Make no mistake: we need 200-250 thousand jobs produced each month to make a dent in the legions of unemployed. The good news is that we are doing better than expected!
At this time, the futures market indicates that the Dow will open about 120 points higher, which makes a dent in the 512 point loss yesterday. While the average investor's stomach feels like it is 2008 again, it is important to remember that the problem was caused by the United States, and we suffered the most. The 2011 problem was caused by Europe, and they will suffer the most. We have been far more aggressive than Europe in forcing banks to increase capital, and we will fare better as a result.
At some point (probably next week), somebody will press the Play button on the negative feedback loop and the average investor will have another stomach-ache, but the U.S. market has more underlying strength than they think. Has anybody noticed that corporate earnings have been excellent, surpassing expectations?
