Note: GDP data will be available later this week, therefore new quarterly asset class expectations and recommended allocations will be included in next week's edition.

Economic Summary

employment – just 142k non-farm jobs were added, 60k below estimates and much lower revisions, year over year trend: flat

Housing – for the 5th month in a row, home prices missed expectations and dropped 0.2%, year over year trend: flat 

Confidence – for the second month in a row, US Consumer Confidence soared to just shy of the Jan. '87 high, year over year trend: advancing 

Manufacturing – manufacturing PMI & ISM are at 2 year lows, year over year trend: receding 

Factory Orders – for the 10th month in a row, factory orders dropped year over year (the longest streak outside of a recession in history), year over year trend: receding 

Q3 GDP Forecast – 0.9 %, down from 1.8%, year over year trend: receding

Employment

142K jobs were added this past week, 60K below the consensus estimate.

Unfortunately, the August print was revised far lower from 173K to 136K.

Putting it into perspective, in 2015 job growth has averaged 198,000 per month, compared with an average monthly gain of 260,000 in 2014.

The unemployment rate came in at 5.1% as expected.

Unfortunately, average hourly wages stayed flat at 0.0%, also below the expected 0.2%.

Actually, if one zooms in, the change was not 0.0%, it was negative, while weekly earnings actually declined from $868.46 to $865.61.

Not only were workers paid less, they worked less, as the average hourly week to week hours declined from 34.6 hours to 34.5.

In September, the US economy added 21,000 waiters and bartenders and lost another 9,000 manufacturing workers.

Since Dec '07 the US economy has added 1.5 million waiters and bartenders and lost 1.4 million manufacturing workers.