Stocks surged today, but it didn’t count. Why? Because it was all based on expectations of more quantitative easing. And supposedly that doesn’t make the rally legitimate.
So just ignore the positive numbers on the scoreboard:
S&P 500: +6.98
And now the top stories;
- The night started off pretty quietly in Asia. China had a monster gain overnight, but it was coming off a long holiday and had to play catch up.
- Europe, too, was pretty quiet, though Eurogroup President Jean-Claude Juncker came out and complained about the strength of the euro, which he said was indefensible — and actually he’s right. The continent is sick; it is hard to justify the euro’s strength.
- Of course, everything was all just a warmup for the main event, which was the jobs report at 8:30. Prior to that, the headlines mostly concerned St. Louis Fed President Bullard appearing on CNBC and seemingly presenting a mixed message on the question of further quantitative easing. The fact that Bullard has been a real dove made his comments particularly surprising. At times he almost came off like a hawk. Click here to see Bullard’s earlier thoughts on the deflation problem >
- Then the main event came and it was pretty bad. Yes, private sector payrolls grew, but… the report was ugly. The headline of 95,000 jobs lost was way worse than expectations because the carnage at the state and local level was pretty miserable. Wages remained stagnant, and U-6 — so-called “real” unemployment — really surged in the month. Click here for the full details behind the report >
- The verdict seemed to be that the report decisively tipped the scales towards more QE. The dollar weakened sharply, especially against the yen, gold perked back up, and agriculture futures just exploded higher — almost frighteningly so. Click here for the 11 investors making a fortune on the surge in gold >
- And of course equities came to the same conclusion, as each of the indices ended with sizable gains.
- The other big headlines of the day had to do with the widening foreclosure-gate crisis. Bank of America is instituting a halt to foreclosures in all 50 states. Citigroup and Wells Fargo are next behind, as politicians are jumping all over this as an issue. See Chris Whalen’s devastating thoughts on the matter here >