10% Unemployment: Good or Bad for the Market?

As reported Friday morning, the unemployment rate in the US rose above 10% for the first time since 1982. As shown below, this is by far the fastest rise since continuous data begin in 1948. It is interesting to note that from 9/30/1982, when the rate first rose above 10%, to 7/29/1983, when unemployment first fell below 10%, the S&P 500 gained 34.99%.

click to enlarge

Comments

[Tom Armistead:]

bit.ly/2ehyRk

WSJ article, this is not 1983

Nov 09 05:16 AM

[Michael Clark:]

HOPE HOPE HOPE HOPE.

It's not 1983. It's closer to 1973 in fact. Or 1937.

Nov 09 05:25 AM

[Michael Clark:]

It's always good for company balance sheets to fire as many workers as they can. Heck: fire half your workers, lowball your earnings expectations, wait for the rally, sell at the top, get out of the business, move to the West Indies, start a hedge fund.

Nov 09 05:28 AM

[User 353732:]

Have we now reached such a stage of pillage and plunder in America that what is bad for the Middle Class is good for Wall St and WashDc and applauded by the MSM?

The decoupling between the US Regime and ordinary Americans continues. The Plantation owners revel and proclaim a boom while the Plantation workers are further exploited and enslaved.

Nov 09 06:09 AM

[chris coonan:]

Huh, and with Walmart in a bid for Target Stores...there could be some buying opportunities.

The question is, will Walmart adopt the bullseye logo? I think they should, it is a classier brand identity.

The headlines will be Walmart Target's Target....

Nov 09 08:01 AM

[Moon Kil Woong:]

Well 10% unemployment is good in the sense that at least it's not higher. As for a rally if unemployment dips below 10%, yes we might see a 30% rally if it drops 30% before then. If it does it next quarter I don't think it will affect things much. What matters more is how much more funny money and depreciation the government and Federal Reserve will put up with.

Devalue currency by 10% and you may see another 20% rally in the market. Whoppee, and in the meantime those who actually have cash will be crying over their loss in purchasing power. The government certainly isn't encouraging savings or fiscal prudence are they?

Nov 09 01:08 PM

[Michael Clark:]

2 out of 5 Americans who want to work full time can't find a full time job. That is a pretty significant statistic. So, where are the demonstrators and why aren't they smashing windows on Wall Street?

Nov 09 01:39 PM

[untrusting ...:]

Because none of them have enough money to get to Wall Street and demonstrate or smash windows. They are too busy using food stamps, going to soup kitchens, or waiting in lines at the unemployment office. Plus they waste a lot of time answering phone calls from bill collectors and attending flea markets to sell off the rest of their possessions.


On Nov 09 01:39 PM Michael Clark wrote:

> 2 out of 5 Americans who want to work full time can't find a full
> time job. That is a pretty significant statistic. So, where are the
> demonstrators and why aren't they smashing windows on Wall Street?

Nov 09 02:13 PM

[JAMES CARLINI:]

So many here are chart-oriented. Everything cannot be explained by a chart - especially this one. Where is the overlay of "underemployed"?

Oh, what is that?

Those are all the people that are counted as "employed" because they are working somewhere, but they are not working up to what they have skills for. IT people, financial people, etc. who were making $80K-$130Km (or more) are now making significantly less.

If your chart isn't reflecting that segment which has lost significant buying power, then your forecasting of what is coming in the future economy is significantly flawed as these people will not be adding to the velocity to the "recovery" as so many are projecting.

As Rodney Dangerfield would say - you might was well be charting life in Fantasyland.

Nov 09 02:22 PM

[JAMES CARLINI:]

They are too busy trying to find work or working 2-3 part-time jobs.


On Nov 09 01:39 PM Michael Clark wrote:

> 2 out of 5 Americans who want to work full time can't find a full
> time job. That is a pretty significant statistic. So, where are the
> demonstrators and why aren't they smashing windows on Wall Street?

Nov 09 02:25 PM