A key to the U.S. economy is how the jobs picture will mature in the months ahead. Thus, today’s report was highly anticipated…

08:30 Apr non-farm payrolls (20K) vs. consensus (75K); unemployment rate 5.0% vs. consensus 5.2%
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08:30 Apr average hourly earnings 0.1% vs. consensus 0.3%; average weekly hours 33.7 vs. consensus 33.7

Prior average hourly earnings unrevised from 0.3%. Prior average weekly hours unrevised from 33.8.
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08:30 Mar nonfarm payrolls revised to (81K) from (80K)
Feb nonfarm payrolls revised to (83K) from (76K).
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The stock market soared on the news and the euro was bombed. Gold dropped $6 early off its recovery high. But why?

Spin, spin, spin and PPT, PPT, PPT, is the way I see it. The ADM report was looking for a US jobs increase of 10,000. The general consensus was for down 80,000 number. So when the number came out a net down 28,000 (including prior revisions), the DOW rocketed up over 100 in seconds … which is the way the market has traded for months. Bad news is ignored and the downside action is tepid. Yet, on all SUPPOSED good news, the PPT rocks the market, and the flock jumps on board.

The question is, from my standpoint, is the action for real (and good for America), or is it trumped up action, which will eventually lead to a disaster of sorts. The latter is the way I see it…

*The jobs number is terrible. Last year you couldn’t go a week without hearing that we need an increase of 150,000 jobs just to keep the US economy on an even keel. In that light, this number is stinko and received nary a mention this morning.

*The wage increase number was remarkably weak - good for the inflation stats, but terrible for the beleaguered US consumer, who is struggling to keep his/her standard of living up to par.

For all the talk of commodity market collapse, crude oil rose $$3.80 per barrel to $116.32 and is not that far from making another all-time high. The US consumer won’t give a hoot about the Planet Wall Street rah-rah when he goes to fill up the gas tank this summer.

*To repeat, this jobs number is lousy, as have been almost all the economic numbers coming out of Washington (I can’t wait to see Bill King tear the birth/death model apart on Monday). Yet, despite the bad news and the US cutting our interest rates, the dollar has bounced sharply. But why? The US isn’t doing one thing to give any lasting strength to the dollar. Instead, it has offered rhetoric and, unlike the ECB, winked a blink in its inflation fight, as is their mandate.

JUST IN ... Toby came through. The jobs report was a far bigger farce than even I thought it would be. You must be kidding me ... the bozos on Planet Wall Street fell for this:

Hello Bill,
The Feds reported the economy shed 20,000 jobs today; much better than expected. Why no one takes them to task on any economic data is beyond me. Below are the Birth/Death adjustments for 2008. Note that April had a whopping 267,000 statistical jobs added for the month. What this tells us for the month of April is 287,000 countable jobs were lost, which is much worse than reported. Apparently the Birth/Death model takes into account economic activity for its estimate. April 2007 Birth/Death contribution was 262,000. So let’s get this straight, last year at this time the economy was buzzing right along and the credit crisis was barely on the radar. Fast forward one year where reported GDP is just barely above recession, the housing crisis has escalated and bank write downs are a couple hundred billion, yet B/D employment was higher? The most blatant misrepresentation of the numbers in the Table for April is in the Construction category. If a collapsing housing market can’t make a dent in this category, what will it take to acknowledge a job loss?

2008 Net Birth/Death Adjustment (in thousands)
Supersector	Jan	Feb	Mar	Apr	May	Jun	Jul	Aug	Sep	Oct	Nov	Dec
Natural Resources & Mining	-2	1	1	1
Construction	-74	9	28	45
Manufacturing	-36	4	7	-10
Trade, Transportation, & Utilities	-64	11	22	24
Information	-20	5	2	3
Financial Activities	-37	10	6	8
Professional & Business Services	-100	39	23	72
Education & Health Services	-11	17	2	31
Leisure & Hospitality	-20	35	44	83
Other Services	-14	4	7	10
Total	-378	135	142	267

One can only imagine what the market response would have been if a number over 200,000 jobs lost was reported today. Certainly the dollar would have dropped significantly instead of surging and the Dow would likely be deeply negative. I know it has been rough in the gold camp as the Feds have pulled off another successful raid. No amount of spin can change the deteriorating US economy fundamentals, which makes owning gold and the shares even more important now.
Best Regards,
Toby