David McWilliams: Debt forgiveness is our only chance of recovery
Published 13/10/2010 | 05:00
EVERY month in the United States, something called the 'non-farm payroll' numbers is watched closely by the financial markets to get an idea about where the US economy might be headed. The Non-Farm Payroll (NFP) measures the national monthly payroll of all industries except farming.
Last Friday, it was revealed that 95,000 fewer Americans were on the national payroll than the month before. This outcome was worse than most analysts had expected. Yet by the close of business on Friday, the S&P 500 share index in New York had reached its highest level since May.
On the face of it, this makes very little sense. The numbers show that the recovery in the US is under threat, yet shares (and, in fact, all asset classes, including gold) rallied on the news.