What's not too like

Good morning everyone, the February jobs report was just released and it shows nice hiring in most areas except local and city governments which lost 30,000 jobs.  The headline number shows a gain of 192k vs an expected 175,000 jobs created and January was revised higher to 63k from 36k.  In strong economic times, all reports are reported for the better not the worse as we are seeing today.  The most important area in my opinion is what happened in the private sector as opposed to the government sector as private businesses added 222k jobs vs an expectation of 198k and January was revised to +68 k from +50k.  One area of pleasant surprise is the unemployment rate which dropped to 8.9% from 9.0% which is a little confusing, but we will take it.  It is confusing because the rate over the last two months is believed to have dropped because many people became frustrated in looking for a job and dropped out of the workforce thereby increasing the rate.  I believe the rate is likely to move back above 9% over the next few months as more people become enthused about job prospects and re-enter the workforce at which point it will eventually head lower for good.  The hourly earnings were flat at 0% vs. an expected increase of 0.2% and the workweek averaged 34.2 hours which is unchanged from January.  This means that employers were not working their employees any longer hours and not paying them more either, this may indicate that the corporate managers may reached the tipping point where they are forced to hire in order to grow their businesses.  The futures market was quite positive before the report and is now trading in negative numbers, I don’t think you should a view Wall Street as being unhappy about the report, rather a buy on the rumor and sell on the news response.  This means that the market has moved nicely higher recently expecting a good report which they got and now they take their profits and hie to the sidelines.  One possible fly in the ointment going forward is the high price of oil and gasoline at the pump, if oil stays high, this crimps the profit margins of companies and may prevent them from hiring.  This also cuts into the spending of consumers as more money is going to gasoline and less in spending.  As much as our economy is 2/3 dependant on consumer spending, then we should be a little concerned if oil stays high and slows down the expansion we are seeing now.