This morning’s U.S. employment report was, I think, the most remarkable data release I have ever seen, at least relative to expectations. Non-farm payrolls, the number of jobs in the economy overall, were expected to drop by a massive number, over 8 million by most forecasts, but instead, they rose by around 2.5 million. A lot of very smart people got it very wrong and the U.S. economy gave yet another remarkable demonstration of its resilience.
I have no doubt some people will try to make political capital out of that, but the fact that it can be spun both ways hints at how pointless and disingenuous that is.
You can say that it just shows what a great leader Donald Trump is, even though, the U.S. has over three times the number of Covid-19 deaths per capita of, say, Germany and even though the bounce back really has nothing to do with him.
Or, if you prefer the other flavor, you can hail the heroine Nancy Pelosi, who has bravely fought Republican opposition to ensure massive government stimulus. From that perspective, she is the great leader, even though with $23 trillion of debt and counting, there will, at some point be a price to pay for it all, and an economy dependent on the public purse is by nature, fragile.
If you can avoid partisanship, though, there are some pretty clear lessons to learn this morning, but not from the numbers themselves. The clearest sign for investors came from the initial market reaction, and that is good news for…