Jobs Report Crushes Expectations... Stock Market Hates It

The jobs report was released today. It smashed expectations and the stock market hates it. So let me tell you what's going on. The expectation was for the month of August, the U.S. labor market would add 53,000 jobs. And we got some hints going into this report of what it would come out to be. For example, the ADP report showed that the private sector added 38,000 jobs in August. That was the slowest hiring pace since January. And then of course, well, today was the big day. The government released the jobs report today and they're that the labor market added 162,000 jobs, blowing away expectations. So you would think that a strong jobs report means that the U.S. labor market is thriving, the U.S. economy is doing amazing, and the stock market would cheer the good news and rally, right? No, that's not how it works. I want to tell you what's going on. So here's how the stock market works in this everything bubble. Good economic news is bad for the stock market. Bad economic news is good for the stock market. So if you haven't figured it out by now, this is just my opinion. I believe that the stock market is rigged. Because let me ask you, do you know what drives your stocks up or down? It's monetary policy. It's central banks, the Federal Reserve. That's going to be the biggest factor on whether your stocks go up or down. Now, with that being said, because the jobs report came in better than expected, at least on paper, it was a good report, right? That allows a higher probability for the Federal Reserve to raise interest rates. Because if the jobs report indicated that the labor market was weak, then the Federal Reserve is less likely to raise interest rates and further damage an already weak labor market. So I hope that makes sense. Yesterday, before the jobs report, there was a 49.4% chance that the Federal Reserve would raise interest rates at their next meeting on Today, after the strong jobs reports, the odds that the Federal Reserve will raise interest rates at their next meeting have increased from 49.4% to 58.4%. So it's still basically a coin toss, at least according to the CME FedWatch tool. And now there's a 41.6% chance that the Federal Reserve does not raise interest rates at the September meeting. This was at 50.6% yesterday. Now, I want you to take a look at these odds. Take a good look. What you're seeing right here will dramatically change on September 11th at 8.30am eastern time. That's when the CPI inflation report is going to be released. And then by, I'd say, end of day September 11th, we're going to know with a high probability whether the Federal Reserve is going to raise interest rates or not at the September 16th meeting. Now, let's move on. Let's take a look at the jobs reports authored by the U.S. government, and let's enjoy this fictional read together. So keep in mind that this report is strictly for entertainment purposes. My opinion is that it should not be taken seriously. However, we still have to know the propaganda and the narrative so that we can maneuver and position ourselves as best as possible. The first thing that I want to point out is that the unemployment rate remained unchanged at 4.1%. And I just want to tell you that this is the single most important data point to the Federal Reserve when they assess the situation of the labor markets. Now, if the unemployment rate rose, then they would be less likely to raise interest rates. If the unemployment rate declines, then they would be more likely to raise interest rates. But neither of those scenarios have been, so that's probably why the odds of an interest rate decision was not, it didn't change severely to the upside or downside. So I hope that makes sense. And then here's the headline, 162,000 jobs added in August. And this is what I mean when I say that it's smashed expectations. Because, I mean, besides the current expectations for what it would be in August, it, I mean, it crushed the previous months as well. In June, 31,000 jobs were added. July, 21,000 jobs added. August, 162,000 jobs added. Amazing. Simply amazing. Now, this fairytale report, it's not all sunshine and rainbows. There are some dark clouds in here as well. And I want to point out one of them to you. On average, Americans are seeing their wages grow at a rate of 3.1%. And that is terrible. Okay, so why do I say that? Because the most recent CPI inflation report shows that inflation is running at a rate of 3.4%. So this means that wages are not keeping up with inflation. Additionally, I just want to say that I'm skeptical of the government inflation figure because the money supply is growing at a rate of approximately 7% this year. So I just want you to think about this. If your cost of living is going up by 7% a year, and your wages are growing at a rate of 3.1% a year, then your standard of living is declining. And you're going to be financially stressed out. And that's not cool, right? Now, let's review which sectors are doing good and bad. Leisure and hospitality gained the most jobs in August, adding 62,000 jobs. The workers in this category, well in the jobs report, they're primarily in the fast food industry, fast food workers, waiters and waitresses, fast food cooks, bartenders, dishwashers, etc. The second sector to add the most jobs was government jobs, adding a net 35,000 jobs. Construction was in third at 22,000. Now, when we take a look at the sectors that lost jobs, it was financial activities. That sector lost 11,000 jobs in August. And information lost the most at 23,000 jobs. Now, the information sector, that includes job types such as software publishers, so a lot of tech employments, jobs in the newspaper industry, books, motion pictures, film production, so basically a lot in the movie related business. And then you have broadcasting, television, radio enterprises. Now, let's take a look at the Challenger report that was released on September 2nd. Job cuts are up 58% in August when compared to July. So, which industries are cutting the most jobs in 2026? Technology is leading the way. Tech has cut 155,126 jobs year to date, followed by transportation at 42,279 and healthcare at 35,637. And what is driving all these job cuts in 2026? So, let me show you the top reasons. Business restructuring has been responsible for 73,649 job cuts this year. Market and economic conditions for 91,373 job cuts this year. And artificial intelligence, or AI, has been responsible for 116,175 job cuts so far in 2026. AI has been responsible for 22% of all job cuts this year. It's the leading reason in 2026. And, I told you this in 2025, AI is no joke. It's having a significant impact on the labor market. And not only is it taking away blue-collar jobs, but it's taking away white-collar jobs as well. And it's basically shaking up the labor market. And it's my opinion that it's going to be ongoing and probably more severe in 2027. And for everyone that's in my financial community, I just want to say that this is why I'm investing in copper. Because did you know that when it comes When comparing a traditional keyword search and an AI search for a question, an AI search requires 20 times more electricity. So, that means we're going to need a lot more energy as AI further integrates into our economy for businesses and for personal use as well. And to build out our energy needs, that's going to require a lot of copper. And the copper industry is at a deficit in terms of production and needs. Just a heads up. Okay, so I've got a lot of things to do today, so I'm going to get going. I wish you a very nice day. Take care.