Flying Pink Unicorns

The March Jobs Report in early April will show at least 150,000 jobs gained

After a series of posts predicting job growth, and having apparently been slightly wrong on timing, I am making a specific, testable prediction for job growth for the current month. I'm predicting that there will be at least 150,000 jobs gained when the government releases the next report on the jobs market in early April. And I wouldn't be overly surprised if the number was over 250,000, a good number in general, and an absolute show stopping blockbuster compared to what has been going on.

I'm finally making a specific prediction because I finally think I know what's going on in the job market. Job growth has already resumed, but slowly. In fact, the other survey that the government conducts, usually considered less reliable, but still useful, shows 850,000 jobs GAINED in the last two months. This is an absolutely astounding number, given that the other survey shows slight job LOSS. I think the truth is somewhere in the middle, and closer to the weaker payroll survey. There's virtually no chance we have gained 425,000 jobs per month over the last two months (which would be a rocking strong total). The number of people filing first time claims for unemployment is MUCH too high for a job market boom. But still, these surveys, unless there are just huge problems with them, are telling us something, namely that there is some job growth out there. Which makes sense based on a few other things we think are going on.

February's numbers, depressed by the snow, showed some strength in wages, which implies a somewhat less weak labor market. Several sectors, including federal employment, temporary workers, and manufacturing, showed some strength. Construction was godawful, but that's probably weather related. In any event, construction layoffs have to slow radically in the coming months, or there wouldn't be any construction workers left!

As for March, the weather is currently quite good nationwide, there will be some census workers added (more in April), and there is one more month for banks to begin lending, which from what I have read hasn't started for small businesses yet (large businesses have had no problems getting money for a bunch of months). In short, this is the month where we finally get the positive job growth I've been predicting for months. You'll know as soon as you see the report whether I'm right.

There's little I like more than being right. But if I'm wrong, I'll post and let all of you know why, and what the report really said.

One other thing before I go. If my economic predictions are reasonably right, bonds are going to do VERY poorly over the next year, and stocks VERY well. If you own bonds, sell. Quickly. The Dow Jones index should get up over 12,000 fairly quickly, certainly by the middle of the Summer. 14k will soon follow. And I wouldn't be surprised if 16k or 17k followed soon thereafter. I think the market is pricing in a lasting recovery, but a weak one, that proceeds in fits and starts. In contrast, I am predicting a medium-strong and VERY consistent recovery. Predicting a consistent anything with the US economy is a surefire way to be dead wrong, but I think the amount of stimulus, both fiscal and monetary, is so historically unprecedented, that we will avoid a real slowdown for at least 2 years, and maybe 3. So the rest of 2010 will have somewhere between good and great growth, with good growth in both 2011 and 2012. The fed should begin raising interest rates in about September, very slowly and cautiously at first, and then beginning about March 2011 quite quickly, as the vigor of the recovery becomes clear. The best of the stock market growth should come between now and about June or July 2011. The next 15 months are going to be a historic bull market. For heaven's sake, BUY STOCKS! NOW.