Until I read this... ..."While some insist that the credit market and housing turmoil has not and will not spread to the economy, significant softening is already evident as is conceded by the Fed itself. In addition a number of prominent economists, even those associated with Wall Street, are now forecasting recession. The main argument of the economic bulls is that employment remains "strong." However, if you hear anyone say that againâand you willâmake them prove it. According to the BLS, the increase in monthly payroll employment averaged 189,000 in 2006 and fell to 118,000 in the first 11 months of this year. In the last six months the increase dropped to only 94,000. Furthermore, the so-called birth/death adjustment accounted for 87% of the average monthly increase in the current year. Since these jobs are probably non-existent, the actual increase in employment this year is miniscule. "... http://www.comstockfunds.com/index.cfm?act=newsletter.cfm&newsletterid=1342&menugroup=Home These guy are permanent bears, but they have a point. New highs for the SP500 within 6 months, I dont think so !
Also employment is the biggest lagging indicator out there and always the last to turn down as one enters a recession
Although I strongly believe there will be a recession. Employment per se will have little, if any relevance to the impending recession. David Roche just wrote a good book called 'The New Monetarism'. Worth a read!
risk was repriced this year from abnormal lows and there will be more shocks to the financial system next year. i really don't see how the economy can get out of 2008 without a recession. not possible to bubble out of a bubble and have a debt to GDP ratio up there with the great depression (not to mention huge use of derivatives that the players know nothing about) without ending in one big mess. a recession could possibly be the best to hope for...