Non Farm Payrolls

We all know that non farm payrolls disappointed a little this morning, so I won't comment too much on this. Here is a chart of the one month change:



During the last recession, the one month change in non farm payrolls bottomed at -330,000 in October 2001. Two problems with using this as a metric to invest is that no one knew that it was a bottom until a few more months were released, and the data I am looking at today may not have been at -330k for the month of October 2001, because subsequent to that it was probably revised. I checked on the web site of the Department of Labor and the original release had it down 415k when it was originally reported.

So when did the market bottom relative to payrolls? Here is a chart from 2002, showing a bottom almost a year later in the S & P 500. Now granted, there was a lot going on at the time, including the September 11 attacks and the unwinding of the technology bubble, so the comparison to today may not be all that valid.




(Chart courtesy of BigCharts.com)