Some thoughts on the employment outlook -- and a "Happy Fourth of July!" message

I'm out of the office and getting an early start on the holiday weekend, so that's why the blog has been empty so far today. But I figured I'd check in and comment briefly on the news of the day.

In short, the jobs numbers were pretty awful ... but not as bad as some of the most dire forecasts. That's why the market shrugged off the news and managed to rally. But let's not kid ourselves: A reading of -62,000 is ugly, especially when coupled with downward revisions to previous months that totalled 52,000 jobs. Moreover, the unemployment rate held at 5.5% -- defying some predictions that last month's big rise was a fluke, one that would be "corrected" by a downward move this time around.

On top of that, the ISM services index dropped to 48.2 in June from 51.7 in May. That missed economists' forecasts for a reading of 51. Worse, the employment sub-index embedded in the data fell to its lowest level since 1997.

Long story short, we're either already in recession or will be soon. That's how I interpret the latest data anyway. With that, have a great Fourth of July holiday!