Today’s Jobs Report Another Sign of Underlying Weakness

It’s the first Friday of the month and today has brought one of the most key pieces of economic data released each month in the employment situation report.

The U.S. Department of Labor reported the country added just 160,000 jobs in April as the unemployment rate ticked up to five percent. This jobs number was significantly less than the consensus estimate of 200,000 jobs created.

What might this data tell us?

Despite much of the positive talk and rhetoric currently being circulated, the economy may not be as solid as many believe. While some are putting the blame for today’s jobs miss on various factors – even the weather – ­the fact is that job growth remains less robust than it should be for a strong economy.

One particular area of concern is that no goods ­producing jobs have been created for three months in a row. Levels in manufacturing are now lower than they were a year ago. That doesn’t seem like progress to us; that seems like regression.

This scenario does make sense, however, if you consider the economic backdrop. Commodities have been hit hard, and the dollar has been stronger at times. China and other emerging markets have struggled. All of these factors mean lower exports and less demand for heavy equipment.

Think, for a moment, about the toll lower oil prices has had on many U.S. employers. By some estimates, energy firms have reduced payrolls for a year and a half straight.

Does that sound like progress to you?

Today’s weaker than expected jobs data will likely mean a June rate hike by the Fed is all but completely off the table. A possible hike in December is the next possible scenario. This would mean that 2016 would have seen just one hike by the central bank, and likely a very small, insignificant hike at that.

Weren’t many expecting four hikes this year just a few months back? Now we may only get one ­or possibly none.

Progress?

Let’s just say we’d call that highly debatable.

Reality check:

Rates are likely to stay low for a long time in our view. There are simply too many significant obstacles for higher rates anytime soon.

At some point, investors will likely realize this. And while stock markets like low rates, the fact that the economy cannot get enough steam going to require higher rates should certainly be sounding alarm bells.

Whether the stock market and risk assets are propped up by the notion of low rates and ongoing stimulus in parts of the world, or whether investors decide to start selling because the market is built on a large house of cards, the day of reckoning will come.

Ignore it at your peril…

Tough economic times may be ahead. An extended period of low returns, substandard inflation levels and ongoing attempts to spur economic activity could be on the horizon.

Is your portfolio ready?

If the answer is “NO,” then it might be time to consider some alternatives. It’s no secret that gold and silver have been moving higher in recent weeks, both staging upside breakouts.

Coincidence?

We think not. Gold and silver have been relied upon for thousands of years as a store of value and protector of wealth. These assets can potentially see significant appreciation during good economic times and bad, and could potentially help hedge your holdings from a declining dollar.

Wouldn’t it make sense to include hard, physical assets like gold in your portfolio?

Given what we see as a trying economic future ahead, you can either keep buying stocks and hope there isn’t a major collapse (AGAIN), or you can be proactive and take steps now to add further diversity to your portfolio using assets that may potentially appreciate in value and protect your wealth and purchasing power.

Adding physical gold or silver to your portfolio has never been easier than it is today. Your IRA account, in fact, may be the best vehicle for acquiring and holding a significant amount of these precious metals. If you don’t have an IRA, now may be the time to begin building your future. An Advantage Gold account executive can show you just how easy it is to add physical gold and silver to your existing IRA, or how to establish a new precious metals IRA.

All you have to do is pick up the phone.

Don’t wait for another stock market collapse, weaker job growth or further erosion in your purchasing power. Act Now. Call us today at 1­-800-­341-­8584 to begin allocating to these key precious metals today.

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