Santelli on Market Rally after Jobs Report: ‘What Are We, A Banana Republic?’
The August Jobs Report showed 169,000 jobs were added, less than many had predicted and revisions from previous months even included a drop of 74,000 jobs. So the jobs total for the month was really just 95,000.
The stock market continued to rally, but CNBC’s Rick Santelli, who covers the Chicago Board of Trade, said that such a contrast was upsetting. “What are we, a banana republic?” Santelli asked. “I just think it’s absolutely horrible that we’re in a marketplace where we get a lousy report. 35 years since we’ve seen these participation rates, and listen: you can’t hide the spread of four to four-and-a-half percent between the advertised unemployment rate and what it would be if you would go back a few years on that participation rate,” he explained.
Santelli, whose Feb. 9, 2009, rant helped give rise to the Tea Party, also said that this latest jobs report was a bad sign for the nation’s future. “See, those people aren’t working. They’re not buying houses, they’re not buying cars. They’re using services, they may be using entitlements or welfare. You can’t hide those millions of people forever. So we wonder why we see our costs to take care of people who are in between jobs rising faster than other areas, less improvement in the economy, not good GDP, that’s why. You can’t play this three card monte game for long. And to see the stock market rally on crappy data to me is just a horrible dynamic. What are we, a banana republic?” he asked.
As the discussion with other CNBC contributors continued, Santelli continued his complaints. “I don’t give a blankety-blank who caused it or why the trend is going, but I know one thing for sure: if these continued trends on demographics, participation rate continue, there’s going to be like 50 people supporting the country.”
“We need to fix this,” Santelli argued. “There are too many who look at the economy through cheap sunglasses
The monthly jobs report, compiled and published by the Bureau of Labor Statistics, showed that employers added just 169,000 jobs in August. While the unemployment rate dropped slightly to 7.3 percent, the civilian labor force participation rate was at 63.2 percent, which, according to CNBC, was the lowest in 35 years.
The jobs revisions by the BLS showed that June and July numbers were worse than originally reported: by 74,000. The June employment numbers were changed from 188,000 to 172,000 and the July numbers dropped from 162,000 to 104,000."
Mark Zandi, chief economist of Moody’s Analytics and media favorite, dismissed the poor numbers. He argued that “you can’t read too much into” the data because of how it’s gathered. The jobs report numbers are gathered based on a poll of a segment of the population, but are widely regarded by those on both sides of the political spectrum to be accurate.
