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Labor market keeps on improving

Weekly claims for unemployment last week fell to a new post-recession low. This could be due to seasonal adjustment factors, which play a strong role in January, but it's more likely just a continuation of the downward trend that has been in place for the past four years.

If there is any message here for the markets, it's that there is no sign of recession; the economy is improving, and it's doing better than the market has been expecting. Short-term interest rates, guided by a Fed that is trying very hard to goose the economy, are most likely too low to be consistent with a long-term, stable-price equilibrium.

If there is a message here for individuals, it's that you want to borrow money now before it gets more expensive, and you want to move any cash you have on the sidelines into the market.

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