The old adage that the market climbs a wall of worry is rooted in historical evidence. History shows us that the prevailing climate during powerful rallies is most often one where conditions are still negative and the majority of investors are bearish and pessimistic. The stock and corporate bond markets have been climbing a wall of worry since early March.

On Friday, the Bureau of Labor Statistics reported that the United States lost a net 247,000 jobs during the month of July and registered a 9.4% unemployment rate. the stock market, measured by the S&P 500 index, rallied 1%  to a new high for the year, bringing the rally total to a 50% gain since the low on March 9. The employment report was the best reading on job losses since before Lehman Brothers failed in September of last year – the event that precipitated the peak of the financial crisis.

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