A very poor Non Farm Payrolls report. With 598,000 jobs shed in January the most in more than a generation (January 1974, 602,000), 66,000 in revision losses to November and December and a jump of 0.4% in the unemployment rate to 7.6%, the labor market is accelerating down. Workers can only fear more job cuts ahead. Their rational expectations must include preparation for unemployment and that predicts further contractions in consumer spending. The saving rate which gained 0.8% from November to December will continue to rise. The gloom in the labor market threatens to become a leading indicatior for consumer spending.