Since the US Dollar is the most dominant macro factor affecting US Dollar denominated stock and commodity prices, you can read this morning’s weekly jobs report as bad being good.
When is bad good? Well, when initial claims come in at 584,000 versus last week’s 559,000 AND climbs above the 4-week moving average (see chart), AND the stock market rips higher… I call that a bad jobs number being good.
Obviously a lot of people still look at the US stock market in a vacuum and those people won’t agree with my conclusion. That’s fine. That’s what makes a market. The New Reality of a country that devalues remains: what’s bad for the US Dollar is good for assets priced in dollars.
The US Dollar is down on the day – stocks and commodities are up. The longer Bernanke can justify this ridiculous “emergency Great Depression” policy of ZERO interest rates with negative (and lagging) economic data, the longer this REFLATION game carries on…
This won’t end well. But neither has this week for the short sellers of everything rear-view mirror.
KM
Keith R. McCullough
Chief Executive Officer
