Yesterday lots of people got excited about the weak March jobs report including MSN, ABC, CBS and many others. Some (MSN Money for one) claimed big market drops, others questioning the economy is if all this were news or unexpected. I guess you could be asleep, but if you’re writing for a major news network you really shouldn’t be. This was not a surprise and not breaking news.
Yes only 88,000 jobs were created last month as compared to 268,000 in February. But this is just what we were asking for right? Budget cuts via sequestration, reducing government spending, reducing employee pay, cutting contracts…just what did anyone think was going to happen? If the market failed to price this in, and it appears they didn’t since the drop was a whopping 40.86 points (less than 3/10ths of just one percent) it would be shame on them. But they got it right it seems.
How can the money editors get it so wrong, so often? Oh that’s right the guys in Washington have it wrong too…trying to cut the budget with a major chunk of the workforce sitting idle.
We’ve done this before and it didn’t work out well then either. Contractionary fiscal policy at this time is the wrong direction. We have, if we look past the DC bickering, been lowering the amount of deficit spending through economic growth. Yes getting people jobs instead of food stamps, up until this month anyway. I’m going to be very interested in the finger pointing on Monday and how the contractionary party attempts to sell their latest budget.