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Dissecting July’s Muddled Jobs Report

If you were looking for last week’s jobs report to provide some answers, tough luck. Enjoy a few more questions.

The U.S. economy added 162,000 jobs in July, roughly 21,000 less than economists expected and the fewest since March. Still, the unemployment rate dropped to 7.4%, a near five-year low, as layoffs slowed and some left the job market altogether. Sluggish growth is what many are calling it.

The report further muddles the discussion around when the Fed will begin tapering its stimulus plan, which pumps $85 billion a month into the economy, creating what one money manager called a “rigged” market. The plan, as most understand it, was to begin pulling the reins back around September, then closing the pipeline sometime in 2014.

If we look only at the unemployment rate, the Fed is on track to hit its September goal. But the problem is the job growth fell back to 2012 numbers. Will the Fed look at July’s report as half-full or half-empty?

"September seems very unlikely now," Beth Ann Bovino, senior economist at Standard & Poor's, told the AP. "I'm wondering if December is still in the cards."

Prolonging the inevitable will have plenty of impact on Wall Street. Bond funds will likely continue to be crushed, smart stock pickers can enjoy volatility, fixed income traders won’t know what to do and the M&A activity will remain sluggish, among other trends.

The one piece of definitive good news to come from the report was the small spike in financial activities employment. The sector added 15,000 in July, with a gain of 6,000 in highly-coveted areas like securities, commodity contracts and investments. The financial sector has quietly added 120,000 jobs in 2013.

Ultimate Cheat Sheet (eFinancialCareers)

We were able to get our hands on a cheat sheet of actual interview questions asked of prospective investment bankers – with answers.

Short Stint (WSJ)

Jerry Donini, chief operating officer of Barclays’ investment bank, will step down on Sept. 1, less than a year into his tenure. He will be replaced by Justin Bull, currently the chief of staff in the firm's markets business.

Moving On (Bloomberg)

Goldman Sachs commodities analyst Stefan Wieler is leaving the firm after four years. No details yet on where he is headed and if the move was voluntary.

Blade Plenty Sharp (Financial News)

European hedge fund giant Man Group achieved $75 million in cost savings during the first quarter, and it’s not done cutting yet. The firm announced it is closing satellite offices in Miami and Singapore.

You Don’t Mess With Clooney (Deadline)

Third Point hedge fund head Daniel Loeb has angered a lot of people in his time. The latest: Hollywood’s George Clooney, who took Loeb apart for sticking his activist investor nose in Sony’s business. Clooney called Loeb a “carpetbagger,” among other creative taunts.

Fat Fingered It (Business Insider)

Someone looking to get a piece of Kemper Corporation's stock likely hit the wrong button on Friday, momentarily sending the stock from roughly $35 a share to $357.90 before the trades were cancelled. Oops.

Buzz Around the Office

Bear Market (MSN)

Not having opposable thumbs can be a pain if you’re dumpster diving. A mama bear in Colorado found a solution though. Just wheel the whole thing home with you.

List of the Day: Promotion Tips

If you want to receive a promotion down the road, start doing these things today.

  1. Keep track of your accomplishments.
  2. Pay attention to who gets promoted and why.
  3. Dress for the job you want, not the one you have.

(Source: The Daily Muse)

AUTHORBeecher Tuttle US Editor

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