This morning’s jobs report was a disappointment. Total new jobs came in at 245,000. This result was well below the 460,000 expected and even further below the 638,000 we saw last month. Looking under the hood, the details were not great either. Private job growth dropped from a strong 906,000 last month to 344,000, again well below the expected 540,000. Even if we adjust for the effects of expiring temporary census jobs, at 93,000, this is still a notable weakening of what until now had been a very resilient employment picture.

We still do not know whether the third wave of the pandemic has peaked. While we saw a significant downturn in case growth in the past week, that may have been due to the Thanksgiving holiday, where cases reported dropped off, rather than to an actual decline in cases. We are now seeing cases surge again, as case reporting of earlier cases is catching up. Again, this is likely due to the holiday rather than an actual surge. There does seem to be continued improvement overall, but we need a couple of weeks for the data to normalize until we can be sure.

November was a great month for the markets. In fact, it was one of the best on record. U.S. markets were up by double digits, as were most markets around the world. We saw new all-time highs here, and even fixed income had a good month. From an investor’s point of view, things looked not just good but great—and clearly markets expect even better times ahead. But do they have it right? Let’s take a closer look.

This weekly update is appearing a couple of days early, due to Thanksgiving. We will go back to the regular Thursday schedule next week. I hope everyone has a terrific holiday. As always, I am grateful for all of you my friends and readers.

Right now, the headlines are dominated by pandemic news, with the number of new cases continuing to hit all-time highs. But there is also growing worry that in addition to the tragic medical damage, we might see the economic recovery roll over as well. While this is a legitimate fear, the data is showing something different—that we may well be close to the end of the recession and back into a sustainable expansion.

As expected, the medical news continues to get worse. New infections hit all-time highs last week as the third wave of the pandemic has accelerated around the country. Case growth in many states remains at levels that threaten health care systems.

As expected, the medical news continues to get worse. The third wave of infections has accelerated around the country. Case growth has again moved to new highs, and the geographic spread of this wave of outbreaks continues to deepen. Case growth in many states remains at levels that threaten health care systems, and several states are moving back to lockdown mode.

The other day, I wrote about my initial reaction to the election. At the time, a winner had not been called. But the fact that the election had gone smoothly—with none of the disruptions that had been feared—was a very good sign, and that was likely to be a tailwind for the markets.

A lot has changed in the past week. I normally try and get this post up earlier in the month, but with everything that has happened—and which has demanded comment—this is the earliest I could fit it in. But that is a good thing, as the ”looking forward” piece is now going to be rather different than it would have been last week. So, let’s take a look back and then forward, and try and figure out where we are going in the next couple of weeks.

The most important economic report—the jobs report—came out this morning, and it was surprisingly strong. This strength was not so much in the headline number, but in the details. Let’s start out with the headlines and drill down to what this report means for the economy going forward, especially in light of the ongoing pandemic.