The Calm Before The Jobs Storm




Today the BLS reported that 49,000 Americans gained jobs in the previous month, which is roughly in line with what expectations were, even though some people did raise their job growth estimates. Remember that the best 3 jobs reports ever recorded in U.S. history all came with $600 enhanced unemployment insurance. The notion that Americans are lazy people that don’t want to work is absurd and very disrespectful. In fact this mindset is during a global pandemic has been one of the most embarrassing things I have heard in my lifetime. We are not soft people and the people who cry everyday on twitter are not a representation of who we are as a country.

From BLS: https://www.bls.gov/news.release/pdf/empsit.pdf

The unemployment rate fell by 0.4 percentage point to 6.3 percent in January, while nonfarm payroll employment changed little (+49,000), the U.S. Bureau of Labor Statistics reported today. The labor market continued to reflect the impact of the coronavirus (COVID-19) pandemic and efforts to contain it. In January, notable job gains in professional and business services and in both public and private education were offset by losses in leisure and hospitality, in retail trade, in health care, and in transportation and warehousing.

As you can see below the sectors of our economy that lost the most jobs are those impacted by Covid19 still.

From BLS: https://www.bls.gov/charts/employment-situation/employment-and-average-weekly-earnings-by-industry-bubble.htm




The unemployment rate for men and women ages 20 and above is running at 6% and those without a high school diploma is still at 9.1% while those with a bachelor’s degree and higher is at 4%. As you can see, we still have work to do.

From BLS: https://www.bls.gov/charts/employment-situation/civilian-unemployment-rate.htm





Rule #2 on the America Is Back Economic Model which I retired last December was very clear.

Model here: https://loganmohtashami.com/2020/12/09/america-is-back-the-final-economic-update/

Don’t focus on the fact that we are nowhere close to having the same type of solid economic data lines that we enjoyed in January and February of 2020 …. We can’t have our economy running anywhere near full capacity and getting all the jobs back while Covid19 is with us. However, with a vaccine just months away, we see the light at the end of the tunnel.

Many economic data lines have shown V shape recovery’s as consumption was not an issue this time around. Demographics are much better than in 2008; we don’t have a household credit bubble that needs to be deleveraged. This time fiscal and monetary disaster relief was solid and did the trick. However, we can’t get all the jobs back while Covid19 is with us. Now, with the vaccine in play, every month that goes by, the life gets sucked out of the American bears because their hope for this country to fail is fading every day.

From AdvisorPerspectives:
https://www.advisorperspectives.com/







As you can see below, the Leading Economic Index looks much different now than in the recovery period from 2008. Demographics & Household Balance Sheet’s much better now than in 2008. Also, we always had over 130,000,000 people working during this crisis.

From AdvisorPerspective:
https://www.advisorperspectives.com/dshort/updates/2021/01/28/cb-leading-economic-index-lei-and-cei-up-again-in-december-annual-revisions





The 10-year yield, even after today’s jobs report, did have a 1.18% print, currently at 1.15%. Remember, my America Is Back model’s ultimate goal is to get the 10-year yield in a range between 1.33%-1.60%. I will be terribly disappointed if we can’t get the 10-year yield to 1.33% this year. Yes, a stock market correction can delay this. However, in time we will all see the Sun together once we walk the earth freely. In time the 10-year yield should get to 1.33% at some point this year.

From StockCharts.com
https://stockcharts.com/h-sc/ui






For now, keep disaster relief going on until more and more of the economy can reopen, and once we can all do the things that we could before Covid19, those jobs will come back. Then we can actually do a real stimulus plan that Covid19 won’t hinder. Right now is the calm before the American storm of sending this demon of the devil and all his American bears back to the abyss where they all belong. Get vaccinated if you can, love each other, fight for one another, one country together, we can do what we have always done, show why it’s always wrong to bet against America.



Logan Mohtashami is a Lead Analyst for Housing Wire, financial writer, and blogger covering the U.S. economy with a specialization in the housing market. Logan Mohtashami, now retired, was a senior loan officer at AMC Lending Group, which has been providing mortgage services for California residents since 1987.