Weak jobs growth, but unemployment declined in US: EM Cap

Sumaira: What has led to this rally, what is giving the investors this confidence that despite the jobs growth not picking up, we know there is this cold weather which is weighing on the jobs market but despite that is it enough for the US markets to move from here thinking that perhaps things will pickup as well?

A: I understand that as of Friday the global equity markets have actually increased by 50 percent in terms of total assets from the money that came out as of February 4. Certainly we see that this morning - a greater global interest in equities and I do believe that there is a general idea that our new Fed chair person, Yellen will likely pull very slowly on further cuts. I think the USD 10 billion that people are expecting will happen. What everyone should be looking at right now is actually Chinese economy. So, in future conversations we may be focusing more on what is happening in China.

Nigel: We have seen the jobs number was quite disappointing, does the Fed go ahead and continue with its tapering program given that the next meeting is in March itself?

A: Interestingly though we saw lower than expected numbers but we still saw a small decline in unemployment and we have to look at the kind of jobs that have been created in the last six months. Most of those jobs remain relatively local and people working at retail, unskilled services and so forth. There are still lots of high earners that are getting hired very slowly.

The other thing that is interesting is in terms of unemployment benefits being cutoff and the fact that workers on several levels must state that they are seeking work in order to remain eligible for unemployment benefits. So it kind of exacerbates the unemployment figures because more people are going to say that they are looking for work just because they want to keep their benefits flowing and I am trying not to be cynical about it but that is actually how it works.