The U.S. Department of Labor reported that employers added about 117,000 jobs in the month of July, with all of the gains coming from the private sector. And with some tricky accounting, the overall unemployment rate fell to an adjusted rate of 9.1% from 9.2%, with somewhere around 14 million Americans currently out of work. Another interesting number, the Labor Force Participation Rate fell to 63.9%, which is the lowest number since 1984.With the exception of the somewhat alarming labor participation rate figure, the numbers on job growth and unemployment looked decent for July. And the report was also quick to add the fact that May and June employment numbers had been revised slightly upward from their dismal reports. Now the question remains whether or not this small piece of positive news will be enough to quell fears that the global economy - and the entire global financial system - is simply not fundamentally sound.
The debt crisis in Europe is only getting worse and its ultimate resolution is as uncertain as ever. Quantitative Easing has proven wholly ineffective in sustainably boosting the U.S. economy and the prospects for a short-term recovery are non-existent. Most macro-economic data points to the fact that double dip recession is pretty likely, if we're not already in one at the moment. It seems unlikely that a modestly positive jobs report is going to do enough to sustain any sort of recovery from yesterday's global sell-off.
And moving forward, it's hard to envision anything other than downward volatility for the global markets as everyone comes to terms with the fact that the overall situation is pretty bleak. Debt-driven economic models are unsustainable at a certain point, and we appear to be rapidly approaching that point.
