From a Republican viewpoint, the best news was that the Labor Participation Rate or percentage of population who wanted to work increased from 62.2% to 62.9%, as a million more Americans started looking for work. It is not that a million Americans suddenly decided to stop being lazy or ran out of meager unemployment benefits. It is that another million Americans thought the job market had improved enough that they might finally have a chance to actually get a job. This is significant because the Fed has been carefully watching this statistic, and that good news makes the Fed more likely to increase interest rates sooner than later. (Still, I don’t expect a rate increase before late this year or even next year.
Because this is the single most important economic statistic each month, one would have expected to the stock market to rally, and it did . . . briefly. Then, Europe rained on our good news with bad news from both Greece and Ukraine. There is no question that the U.S. stock market would rally if we could suddenly reverse globalization and decouple from the world. Of course, there is zero chance of that happening, and I’m glad . . . but only in the long run.
For now, let’s just be happy for the 257 thousand Americans!