Stocks and bonds and the dollar, oh my.

Okay, here's what's wrong with reliance on the U.S. stock market to determine the state of our economy. Today's weak Labor Department payrolls report, showing a gain of only 138,000 jobs in April (far fewer than the predicted 200,000 jobs, coupled with a significant downward revision of the earlier months' job creation) caused a sharp drop in the dollar against foreign currencies; but nevertheless ignited a buying spree of stocks. Why? Because the lapse of growth of jobs means, to investors, that the ecomony is cooling enough to cause the Fed to demur from further interest-rate increases as a means to quiet the prospect of inflation from a too-hot economy.

Get it? Because interest on U.S. debt instruments--related to the Fed's decision about rate increases on short-term borrowings from federal banks--won't rise, common stocks will become attractive investments, relatively.

We're in another period of "irrational exuberance" in the market. There's no basis, it seems to me, other than investment speculation, for corporate investment to be so out of kilter with reality. It's true that many companies are reporting high profits, but it's entirely at the expense of their workers; and with those workers (as consumers) saddled with debt and not receiving decent wages, we're in for a long fall. This fall.