Time lags are strange things, really. The moments between a blow to the crotch…and the pain; the time between an earthquake…and the tsunami; and the wait between a major dislocation in credit markets…and the ensuing job losses in the wider economy leading to lower consumption.

The US is not there yet (which is one reason there are still optimists) but chances are the shots taken to the tenders will not be denied their inxeorable pain however much praying is done in the foetal position.

The latest ADP National Employment Report, whilst showing a definite confirmation of the Bureau of Labor Statistic’s now negative trend data, reveal most damage is still to be found, unsurprisingly, within the construction and mortgage financing sectors. But this bit is a likely harbinger for the wider economy:

"Employment in the service-providing sector of the economy declined 3,000, the first decline since November 2002."

Exhibit 1:

Europe and US futures data are down very modestly in the wake of the report; if that's not a time lag in action (and on cue) go ahead and take the (benign) over for Thursday's non-farm payroll data.

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