If you own stocks you don't want what happened today. You don't want lighter job growth. You don't want middling wage gains. You want a non-farm payroll report to be something shiny and bright and strong.
Because somehow the Federal Reserve has gotten itself in this ridiculous box where it has to raise because it said it was going to raise.
I have been telling you that the economy was slowing, that the peak may have actually been when Fed Chief Jay Powell said, at the beginning of October, that the economy is so strong that he might have to put through four hikes, maybe he even had to overshoot to slow it down.
That was the cue, that's all you had to hear to know that things could get dicey because words like that carry a heavy burden; they can be self-fulfilling which is why the previous Fed Chairman, Janet Yellen, avoided such sweeping, rash statements in favor of more muted data dependent views.
Now, on its own, without those pronouncements, the numbers this morning justify waiting, not acting. Powell, however, risks stirring a wave of fear if he DOESN'T raise rates. Investors will presume that something is wrong or worse than he thought so they should be more cautious.
To be fair, I totally understand why he could still want to do a December hike: the PMI reports are all strong, the retail sales have been strong -- although I doubt they will be going forward -- and we are close to full employment.
The fact is, though, that the economy is getting slower and the stock market sure shows it. That's why it's so skittish. No one wants the Fed to raise rates into a slowdown. They want the Fed to be flexible. But that's now out the window because of previous comments. Anything less than a quarter point and panic will reign.
I hate to say it, Mr. Powell, but, here goes: I told you so.