Financial Market Update

This week: markets have a plate full of data to work on but the week has nothing that will over-power the employment report for July that will be released on Friday. Early estimates are for a decline of 87K jobs but somewhat deceiving in that the decline in jobs is census related and some decline due to the annual auto manufacturers layoffs for retooling for the new model year. The unemployment rate is thought to be at 9.6% up 0.1% frm June. Employment is obviously key, the data is subject to interpretation and generates debate between those that know unemployment is much higher than the headline data and those that know that employment is a lagging indicator and doesn't improve until well into recovery. This time, in this recession, it is different; many of the lost jobs will not re-appear for a long time. Markets begin the week with the same debate; although the earnings have been solid and fuel economic improvement ideas, it begs the question who is buying the products that manufacturers are producing? Housing continues to show little improvement and there is increasing recent concern that deflation is the new giant to be slain.