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Politics : PRESIDENT GEORGE W. BUSH -- Ignore unavailable to you. Want to Upgrade?

To: DuckTapeSunroof who wrote (522485)	1/11/2004 11:52:41 AM
From: DuckTapeSunroof	Read Replies (1) \| Respond to of 769670

Yesterday, the Department of Homeland Security ratcheted back its terror alert to "yellow" from "orange." But the nation's job market is still on "red alert." The Labor Department reported that non-farm payrolls increased by a paltry 1,000 jobs in December, far below the 200,000 job additions that many Wall Street sages were predicting. Not only was the December report a complete bust, but revisions to the unemployment reports for October and November stripped away another 51,000 jobs. Net-net, the economy is only 278,000 jobs ahead of where it was five months ago. Trying to find the main reason for December's surprisingly weak result is like trying to find the main reason why the Detroit lions lose football games. The report reflected a dispiriting lack of growth in nearly every industry. Retail employment fell by 38,000, while the manufacturing sector extended its unbroken string of 42 straight monthly job losses by shedding another 26,000 working stiffs. The latest losses from America's rustbelt mean that nearly 3 million jobs have disappeared from the manufacturing sector since the middle of 2000. Another troubling facet of the December report was the continuation of a trend we predicted in this column several months ago: the mortgage industry is shedding thousands of jobs. The mortgage industry had been one of the very few sectors to expand payrolls since 2000. But the sting of rising interest rates has shifted this job-creation engine into reverse. "Employment in credit intermediation declined for the third consecutive month," notes the Labor Department's dispatch, "reflecting the reduced volume of mortgage refinancing. From July 2000 through September 2003, the industry added 251,000 jobs, but since then employment has fallen by 39,000." The weak jobs report lit a fire under the bond market, while incinerating stock prices. In the bond trading pits of Chicago, a moment of stunned silence followed the release of the unemployment report. "Traders couldn't decide if the gain of 1,000 jobs was a joke or a typo," said trader Phil Flynn. Almost immediately, traders started bidding furiously for bonds of all maturities. The buying didn't stop until the yield on the 10-year Treasury note had dropped from 4.25% to 4.10%.