Wall Street Holds Steady

Though he would like to see a half-point reduction next week, he thinks a quarter-point is more probable. No move, he says, would be a "disaster."

"I think the report is strong enough we won't get the 50," Karl says, while adding that it still shouldn't prevent any easing at all. "The Fed needs to cut. We can't just sit on our hands."

Peter Morici, a professor at the University of Maryland School of Business and former chief economist at the U.S. International Trade Commission, agreed in an emailed statement that action is required, and he says the pace of job creation is too sluggish.

"Slow jobs growth, along with the shortage of business credit, declining home prices and falling industrial production, indicate the risk of a recession is clearly above 50 percent," he says. "Either the economy has already entered a recession or the risk that a recession will begin soon exceeds 50 percent."

Because of the upbeat productivity data released earlier this week, Morici thinks the Fed "can aggressively cut interest rates to combat a recession without risking inflation."

Brandon Thomas, chief investment officer for Envestnet Asset Management, says that considering the negativity about the economy, the report was quite good, as was the 0.5% increase in average hourly earnings, but not so much to prevent a quarter-point reduction next week.