“A Better Than Expected Jobs Report” - I have heard that line over and over today. It’s a nice spin, but it is not reality. At least, not my reality. In my world, when you lose jobs, it’s not positive. Just because the Jobs Report is fundamentally flawed in its construction and just because most economists have no clue how to forecast, it does not mean that the number is “better than expected.” According to Bloomberg’s survey of 82 economists, the median forecast was for a loss of 75,000 jobs. Let’s just pretend the consensus had come to a luckier guess of -10,000. What would the headline have been then? Would -20,000 have been worse than expected?

To me, “Better Than Expected” works like this. If you expect to make $10 and you end up making $15, that is better than expected. If you expect to lose $10 and you only lose $5, you better spend more time figuring out the basis of your expectations. As I have repeatedly written on here (just use the search tool for “jobs report”), I find no investment value in this snipe hunt. I do find value in analyzing the reaction - whether I like or dislike the data or the reactions. The “better than expected” reaction to “less negative than expected” job loss compared to “as bad as I expected” economic forecasts is meaningful. The bullish sentiment is fighting and right now, they are doing a good job.