The Way We Were: One Year Ago on March 4, 2010 — Let’s rewind back to exactly one year ago on March 4, 2010 and see what our Chief Market Strategist Jeremy Klein had to say on that day: My favourite Earnings Report of the Year Another yawner of a session yesterday as the daily high-low range in the S&P E-Mini futures failed to break 10 handles to reduce the average 5-day range to 10.60 points.

The SPX, DJIA, and NDX all returned less than 10bps either way while the Russell 2000 played the real outlier of the day finishing a massive 15bps higher. Despite the fact that we have seen volatility steadily decline since the bottom of last month’s retracement on February 5, Friday’s scheduled Jobs Report has captured stocks in a vice grip, not allowing the market to provide much in the way of action. Whether appropriate or not, the Nonfarm Payrolls release’s importance is so great that regardless of the absolutely miserable data that printed last week, a good Nonfarm Payrolls report will allow all to be forgiven and then forgotten.

I will preview the Employment Report tomorrow in more depth along with a public pronouncement of my Quick and Dirty estimate of Payrolls for the first time in exactly two years. Putting aside my “world famous” quantitative analysis of the number, one thing that concerns me stems from comments from two Fed Bank Presidents. First, Minneapolis Fed President Kocherlakota opined on Tuesday that he does not expect the Unemployment Rate to dip below 9% by year end. Next, Dallas Fed President Fisher predicted yesterday that the same statistic may again climb above 10%.

Both statements are disappointing stand alone, but taken in context that it preceded the next instalment of the Unemployment Rate by just a couple of days, one might assume that these two FOMC members would not stick their necks out to specifically downplay the state of employment without the number in hand to back it up. Certainly, that has happened before on numerous occasions. Of course, while on a longer term basis the Unemployment Rate and Nonfarm Payrolls correlate highly, month-to-month moves have much more noise. Still, one has to pause and take stock of the negative undertones coming from these comments.

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