Last Friday, January 4, 2022 the BLS (Bureau of Labor Statistics) released the most recent Employment report for January.
With the report actually quadrupling employment hire expectations and large revisions upward to several prior reports, the FOMC (Federal Open Market Committee) is all but forced to begin raising rates soon!
BREAK IN – Interesting Weekend Research Findings – In two different areas of the financial world, this last weekend of researching this post a reminder that HUGE population adjustments occurred in this report. Here is an accidental finding from the St Louis research site showing the effects of the revisions in 2021…
From the report:
Total nonfarm payroll employment rose by 467,000 in January, and the unemployment rate was little changed at 4.0 percent, the U.S. Bureau of Labor Statistics reported today. Employment growth continued in leisure and hospitality, in professional and business services, in retail trade, and in transportation and warehousing.
Hot Report Puts FOMC on Go For Raising Rates
This HOT report, of 467k gains in employment, with expectations less than half of this number surprised market participants and the FOMC (Federal Open Market Committee) too, most certainly.
Adds in employment continue to help the Unemployment rate, once again giving the FOMC a green light of urgency to raise interest rates.
Market participant digestion of the rate raises will be interesting. Recall just a month or so ago, FOMC officials saw only one raise in 2022.
Also, recall our review of a large conference on March 24 of 2021 — yes 2021 almost one year ago…
Views: Number One From the Conference – Go Away FOMC – You Have Stayed Too Long
View number one and shared by every market related expert, the federal reserve is overstaying their welcome and should immediately stop asset purchases and begin talking about increasing rates. The main reason for these shared views are because asset levels have become inflated across almost all assets according to the experts and be continued purchases are no longer necessary given that capital markets are orderly.
Has the FOMC waited too long?
Next up, interest rates front run the FOMC!
Have a Great “Hot Unemployment Report Review” Day!
John A. Kvale CFA, CFP
Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth