Discouraged workers, downward revisions

Positions
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+1000 UCO @ 7.87, cost @ 6.70 (Increase stop to 7.30)


Jobs, Jobs, Jobs
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Sell the dummy rallies! Markets irrationally jumped on horrific jobs data today and the sizeable rally slowly, but steadily disappeared. We are now looking at worse than 1% losses across the board. February's nonfarm payrolls loss of -651k jobs was in-line with consensus expectations (-648k). Many explain today's phantom rally by stating that the losses weren't nearly as great as feared. Reality quickly set in. Downward revisions to December and January payroll numbers exceeded 150k. One astute forecaster (ok so I wasn't the only one) correctly predicted a rise in the unemployment rate to greater than 8%. However, I think this number significantly understates the actual level of unemployment.

What is a discouraged worker? A discouraged worker is a jobless individual that is unable to locate work and through frustration, exits the labor force. I understand - presumably all of those frustrated people have decided to retire early (at 26) and pursue other opportunities. It makes perfect sense, doesn't it? Let's just say that many people aren't currently searching for work because unless your expertise is in the pharmaceutical/healthcare sector, you are like a desperate guy hanging out with 15 of your older sister's girlfriends - You may get the look, but you have to be Don Juan to get a shot.

Supply and demand folks. There just aren't that many opportunities. Discouraged workers in this downturn are very much unemployed.


Live from Queens,
TM