It was yet another disappointing job report from the BLS today. In the month of September, the U.S. created just 64k private sector jobs, while the overall figure was a loss of 95k employees. But the economy needs to create about twice that private sector number in order to prevent the unemployment rate from rising. Even more disturbing figures in the report came from hours worked and the productive sector of the economy. The average workweek for all employees held unchanged at 34.2 hours. And the number of goods producing jobs lost was 22k.

The Labor Department today also published its preliminary estimate for the annual benchmark revisions to payrolls that will be issued in February. They showed the economy may have lost an additional 366,000 jobs in the 12 months ended March 2010. The so-called underemployment rate (U6), which includes part time workers who’d prefer a full-time position and people who want work but have given up looking, shot up to 17.1% from 16.7%

So this underwhelming report opens further the floodgates to QE2. In fact, former Federal Reserve Governor Larry Meyer said in a CNBC interview today, “Another round of QE is baked in the cake.” He continued, “Markets expect cumulatively around a trillion, and my guess is it will be more than a trillion…it will turn out to be one and a half trillion.” Then he concluded giving the Fed this gem of advice, “You’re not going to sit on your hands, you shouldn’t sit on your hands, you should do something and hope for the best.” President of the St. Louis Fed James Bullard’s comments to his recommendations is that the Fed though it prudent to purchase $100 billion a month. Therefore, the stock market is rallying in nominal terms because investors have been put on notice that the value of the dollar is headed much lower.

Michael Pento, Senior Economist at Euro Pacific Capital is a well-established specialist in the “Austrian School” of economics. He is a regular guest on CNBC, Bloomberg, Fox Business, and other national media outlets and his market analysis can be read in most major financial publications, including the Wall Street Journal. Prior to joining Euro Pacific, Michael worked for a boutique investment advisory firm to create ETFs and UITs that were sold throughout Wall Street. Earlier in his career, he worked on the floor of the NYSE.

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