Payrolls were surprisingly strong on Friday; headline +528k, with about 250k expected. Of course, this bit of economic good news caused equities to sell off, along with gold, silver, and the 10-year bond. The initial sell-off was all about disappointment surrounding the much-hoped for “Fed Pivot” – theory being, the weaker the economy appears, the more likely the Fed is to stop raising rates and start printing money, which makes all the traders excited.
Of course the opposite happened Friday due to the “good news” of the surprisingly strong payroll numbers. The strong payrolls said: “no money printing coming soon.” That was bad news for the traders, and so prices fell.
Wolf Richter has an article on point: Recession Mongers Shocked & Horrified by this Surge in Employment (Source). The most interesting part is his description of the “stuck” labor force: “Many folks, including the Fed, are now suggesting that the old normal labor force may never return, that there were permanent changes in the labor market that we’re just now trying to figure out.”
Hmm. Whatever could he mean?
Certainly, “something” definitely happened in 2021 to take three million people out of the labor force. “Overall, layoffs and discharges in June and in the prior months were at historic lows. And there are still large-scale staff shortages in the healthcare system, school systems, airlines, and many other industries.” Airlines and healthcare, huh? Let’s see. What happened in those two industries in 2021? Anyone remember?
Now, imagine we add the “excess mortality” among working age people that the life insurers were seeing in 2021, to the disability increase shown on the chart below:
So, something else to add to your “shortages” list: labor, due to disabled and dead workers. I suspect this overhang of vax-disabled and vax-dead workers (thank you, mandates) will lead to continuing tightness in the labor market.
by mike-from-jersey 
