The stock market is hitting highs not seen since early 2008, and in the case of the NASDAQ, since 2000. Our FOX Index, which measures “healthy” as a total above a Dow of 12,000, an S&P 500 of 1,300, and NASDAQ of 2,500—total, 15,800—is at its all-time (Index began in August 2008) high of 17,113, or plus 1,313 (see chart).
And why not? Job creation for January came in at 243,000, against estimates as low as 121,000, and the unemployment rate dipped to 8.3%. The rate was 8.9% as recently as October. Moreover, the payroll increase for December was revised up to 203,000 from 200,000, and November’s figure was revised up to 157,000 from 100,000. The U.S. has added an average of 183,000 jobs a month in the past five months.
Please see the chart below, a version of which we have run every month since last May. If job growth continues at 180,000 a month over the next 8 months, Obama will sail past his minimum target of replacing all jobs lost during his administration. And if the unemployment rate falls only as much in the next 8 months as it has fallen in the last 4 months, Obama will have America back to the unemployment rate when he took office. A rough four years, yes. But recovery under way? You bet.