Today’s jobs report is a mild positive, with the headline number of 157,000 jobs created in January coming in close to the average rate of job creation we have seen since last June (163,000).  Upward revisions to past months also give us a sense that the trajectory is positive.

There has been some talk that the economy is slowing sharply, fed in part by the fourth quarter GDP growth number that came in negative.  However, the negative fourth quarter was bound to happen, as third quarter GDP was unusually high because of a massive increase in defense spending, an increase that was fully offset in Q4. While some assert that the number was unexpected, we said in this space in early December that fourth quarter GDP growth would be “close to zero.”

Smoothing through the last two quarters ups and downs, (which were, by the way, very convenient for President Obama) the economy appears to be growing at a rate of about 1.5 percent, and this jobs number suggests that the first quarter of this year continues at about that pace. The most interesting thing is that the private sector appears to have been wholly unaffected by the “fiscal cliff” uncertainty.   Perhaps everyone expected it to be resolved despite the kabuki theater, or perhaps the private sector has learned to ignore the lunacy of Washington, just as a parent can drive along blissfully while kids fight in the back seat.