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Mike the PhD
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I have a PhD in Finance, a Masters in Economics, and a B.S. in Industrial Engineering. All three of my degrees have largely been focused on data analysis, and that’s what most of my work experience has dealt with. I’m a professor at a major US university now where I teach classes on data... More
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  • A Note Of Caution: 0 comments
    Mar 8, 2013 6:40 PM

    Today's unemployment numbers were pretty good; remarkably good in fact given the concerns about the fiscal cliff, the sequester, and the weather. And while everyone should be cheering for stronger employment numbers to continue going forward, it is worth noting that the January numbers, which had been for 157,000 new jobs were revised down to only 119,000 new jobs. That's about a 24% fall. Assuming that this month's numbers are also revised down 24% or so, that would put the February jobs number around 179K which is only slightly better than what the street was looking for.

    It's also worth noting that the payroll numbers are a fairly volatile measure. They have averaged about +170K or so over the last couple of years, but even taking out the recession, they have bounced around from about +100K to about +250K each month. To put some specifics on it, the last 4 months payroll numbers prior to today's were (after all revisions to date):

    October +160K

    November + 247K

    December +219K

    January +119K

    Hopefully my concerns are misguided and we will continue to get 200K+ numbers for a long time to come, but I'm wary of reading too much into any one data point. Don't get me wrong, I'm all for bigger payroll numbers, but let's hold the champagne for a bit.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

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