The market’s knee-jerk reaction to this morning’s Non-Farm Payroll miss — 169,000 jobs vs. expectations of ~180,000 — sent everyone intorisk-offmode as Gold spiked more than $20 on the news to trade around the $1390 level.  Silver rose $0.60 and looks like it will challenge the elusive $24 area as we approach the end of this week.

Last night the benchmark 10 year U.S. Treasury Note topped 3% briefly but between the jobs number and a note from the State Department for all diplomats to exit Lebanon, the rush to marginally safe-haven assets sent yields tumbling.  The 10 year yield dropped back to 2.88% but is still stubbornly refusing to break down below support at 2.80%.  We are seeing a classic higher-highs and higher-lows pattern on bond yields that only the most committed “Don’t Fight the Fed” bond bull would ignore at this point.

A close above 3% on the 10 year on a weekly basis going into the G-20 meeting would be a disaster for President Obama.   Gold prices above $1400 would be as well.  So, the fight continues to revolve around arbitrary round-numbers.  But, understand that like the President’s political positioning for attacking Syria these levels represent nothing more than temporary tactical retreats.

As for the NFP number, there has been no recovery in employment in the U.S., just a shuffling of full-time workers into part-time jobs ahead of the imposition of Obamacare and a hollowing out of the workforce as Labor Force Participation continues to sink, putting lipstick on the U-3 Unemployment pig.