Digging Deeper than just the Headlines
While the USA generated 257k (first estimate, will be revised) new jobs for the month of January, the action was elsewhere.
- Average hourly earnings were up .5%, this is a huge number and very good for the employment situation as employees may FINALLY be getting a raise!
- Unemployment rate went UP (increasing labor participation rate), but that is because more people entered the workforce, again VERY good for the economy!
Higher Rates – 10 Year Yield Rises
While all of this is good news for the economy, these are headwinds for the capital markets, in the SHORT term (1-2 years) …. longer term this is very good news, as it helps support the frothy valuations and gives us more confidence that the Fed will be able to raise rates this year … FINALLY!
Janet Yellen and the other Federal Open Market Committee (FOMC) members … Raise those rates !
Have a Great Day!
John A. Kvale CFA, CFP
8222 Douglas Ave # 590
Dallas, TX 75225