Stock Selloff, Collapse of Cryptos, Meme Stocks & SPAC/IPO Zombies Bringing Day Traders Back into the Labor Force?
By Wolf Richter
Interesting stuff happening in the labor market, suddenly.
Employers added 315,000 workers to their payrolls in August, and 1.13 million over the past three months – solid growth.
Households reported that the number of working people in regular jobs or self-employed jumped by 442,000 in August, after having been essentially flat for months. There have been indications that aggressive hiring by employers pulled some self-employed workers out of self-employment and onto regular payrolls. Hence the sharp increase in payrolls and the more slowly growing overall number of working people.
Wages rose again, but a tad less sharply. The number of unemployed people actively looking for work ticked up from July, but July had been the lowest level since the year 2000 at the peak of the dot-com bubble.
The biggest movements were the jumps in the labor force, the labor force participation rate, and the prime-age labor force participation rate, a welcome turn in a labor market pressured by demand for labor and labor shortages.
The instant play money vanished.
This jump in the labor force comes as the S&P 500 index is down 18% from its high at the beginning of the year. The Nasdaq is down 28% from its high in November. Many of the most speculative stocks, crazy meme stocks, and SPAC and IPO zombies have collapsed by 70% or 80% or even over 90%, hundreds of them, some of which I report on in my Imploded Stocks column.
Most cryptos have collapsed by 70% or more, and some have essentially vanished. DeFi crypto exchanges and lending platforms have filed for bankruptcy and taken their clients’ fiat and cryptos with them. It has been a nightmare out there for people exposed to this stuff.
These are the kinds of high-risk blood-pressure-raising adventures that lots of people embarked on during the pandemic, and initially made lots and lots of money with, often life-changing amounts of money that allowed them to just rest on their laurels and live off their gains, and not have to return to the daily grind.
If they didn’t return to the daily grind, they thereby exited the “labor force.” The labor force is defined as people who are working or who are actively looking for work. But if crypto millionaires don’t want to go back to their day jobs and aren’t looking for work, they’re out of the labor force…..
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This article is courtesy of ThePricklyPear.org, an online voice for citizen journalists to express the principles of limited government and personal liberty to the public, to policy makers, and to political activists. Please visit ThePricklyPear.org for more great content.
