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Dour Labor Numbers
In recent months bankers have been looking to the labor market to gauge the depths of the recession. The depths appeared to deepen today.
From Bloomberg:
U.S. employers eliminated jobs in November at the fastest pace in 34 years and the unemployment rate jumped as the yearlong recession engulfing the world’s largest economy deepened.
Payrolls plunged by 533,000 last month, the biggest loss since December 1974, after shrinking a revised 320,000 the prior month, the Labor Department said today in Washington. November’s losses exceeded all 73 forecasts in a Bloomberg News survey. The jobless rate rose to 6.7 percent, the highest level since 1993. …
“The labor market capsized in November,” Ryan Sweet, a senior economist at Moody’s Economy.com in West Chester, Pennsylvania, said before the report. “The financial panic has hammered the economy and we are seeing a very broad-based decline in payrolls.”
The demarcation bankers are watching is the 7.5% threshold for unemployment. When it crosses that level, expect another round of credit reserves.
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