Recession Talk Resumes

Stock market bulls got their weak jobs report -- and then some.

Shares tanked Friday after the government reported that private payrolls contracted in August, marking the first monthly nonfarm job loss in four years. Bond prices rose as investors bet the unexpected decline in employment will finally force the Federal Reserve to cut its fed funds overnight lending target, which has been stuck at 5.25% for more than a year. The dollar dropped and gold prices surged.

"If there was any doubt over whether the Fed would be cutting interest rates on Sept. 18, this report should remove it," writes Nigel Gault, chief U.S. economist at Global Insight. ...