The unemployment rate rose to 10.2%, higher than expected and the highest rate since 1983. The labor force shrank by 31,000 which means the unemployment rate did not spike because of a surge of workers reentering the pool, as often occurs near turning points.

Non-farm payrolls fell by 190,000, which was more than the consensus estimate of 175,000. The higher-than-expected decline was somewhat offset by revisions of 91,000 for the prior two months and the fact the sub-200,000 decline continues the trend of smaller monthly declines.

The average hourly work week stayed at its lowest level since 1964 and the average length of time people are unemployed rose to 26.9 weeks from 26.2 in Sept and 22.5 back in May, according to Peter Boockvar of Miller Tabak.

Friday's report puts several of this week's big events into sharp relief...

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With the Dow Jones Industrial Average once again marching closer to 10,000, many investors, especially those who missed the rally since March, must be asking themselves: Is now the time to finally pull the trigger?

Robert Prechter, founder of Elliott Wave International, implores retail investors stay away… for now. Prechter, who was bullish near the lows in March, now says the stock market "is in a topping area."

Why?

Several factors:

• Slowdown in upside momentum. Recent intraday rallies are petering out before the close.
• Bullish Sentiment. Investors who were bearish near the lows, are now just as bullish after a 60% run in the S&P 500. To Prechter, "that's a dangerous place to be."
• General overvaluation of stocks.

Prechter, the author of Conquer the Crash, says this is akin to the market in 1966-74 or 1929-32, where massive bear rallies gave way to another "big leg down."

American worker productivity surged in the third quarter and new jobless claims fell to their lowest level since January, the government reported today, more signs of a nascent economic recovery. But no one's cheering just yet.

With businesses reluctant to hire, economists forecast the unemployment rate will tick up to 9.9%, when October’s figure is reported tomorrow.

"I think we're going to lose another million jobs between now and the middle of next year," says our guest Leo Hindery, managing partner at InterMedia Partners. Hindery, a former cable executive, has also advised President Obama and John Edwards on economic policy. "There need to be some prescriptions," he says.

His proposed game plan?

Genuine manufacturing policy. With less than 12% of U.S. GDP stemming from manufacturing, the sector must be energized to stabilize and offset an economy now hinged on consumer spending and services. Domestic labor costs are not what's costing Americans jobs, Hindery says. The real culprits are illegal subsidies, currency manipulation and poor environmental practices by our trading "partners," most notably China.

Buy domestic program. While critics cry foul, with charges of protectionism...

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Many media-industry pundits have dismissed Comcast's play for NBC as the latest foray of a deranged distribution guy (Comcast CEO Brian Roberts) obsessed with getting into the content business.

The evidence?  Roberts tried desperately to buy Disney a few years ago--over his shareholders' screams--and now he's furiously negotiating for a hobbled NBC.  All this while fellow cable-content mogul Jeff Bewkes of Time Warner is bemoaning the hard lessons his company learned when it tried to combine content and distribution into the Holy Grail of "synergy."

But Roberts isn't a madman, says Leo Hindery, managing director of private-equity firm InterMedia Partners.

Comcast's goal here...

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But even Hindery, a former advisor to President Obama and John Edwards' senior economic policy advisor, can't deny the Democrats have stumbled.

"The lesson is simple: It's the economy, stupid," Hindery says. "Healthcare reform is an important issue...but the priority was misguided. I'm a strong advocate of universal healthcare but would have put it behind employment."

The issue is not so much the Obama administration hasn't created jobs but unemployed Americans "do expect the appearance is every effort is being made to reemploy them," he says. "I think we got away from that perception [due to] the overemphasis on healthcare."

As a result of these misplaced priorities, Hindery says the Democrats are...

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From The Business Insider, Nov. 4, 2009:

The Federal Reserve just now signaled that it will keep in place monetary policies designed to fight the recession and the financial crisis.

The Fed repeated language in its monetary policy statement  that interest rates will stay at a record low for an “extended period." It also reaffirmed that its program to buy mortgage backed securities will remain in place until some time in the first quarter of 2010.

The statement did note that the economy is improving. It noted that the housing market is showing some expansion and consumer spending has increased. It expects inflation to remain "subdued."

As expected, the Fed kept interest rate targets at zero.

Earlier today a source told us the Fed statement would begin: "Information received since the Federal Open Market Committee met in September suggests that economic activity continued to pick up following its severe downturn..." Which is remarkably close to the actual wording. Note, however, that the "severe downturn" has been dropped.

Click here to view the official statement.

More coverage from The Business Insider:

• RIM should sell now before it's too late
• The 20 most unemployed cities in America
  

Will stocks continue to rise like a phoenix from the ashes of the financial crisis? To be honest, your guess is as good as anyone else's.

What is clear: low interest rates around the world seem to be fueling another asset bubble driven by Asian investors, as The Wall Street Journal reports.

Jeff Matthews, founder of hedge fund Ram Partners, says "cheap dollars are going to attract more money" which means U.S. "real estate is a wonderful opportunity."

Unlike the housing bears, Matthews isn't too concerned about the "shadow inventory" of homes for sale and believes there's more-than ample demand for housing, especially with construction remaining at such relatively low levels.

Turning back to the stock market, Matthews says many stock values have gone from deal of the century valuations in March to prohibitively expensive. "Fundamentals have to catch up with valuations," says the value investor and author of Pilgrimage to Warren Buffett's Omaha.

However, "the good news is better than the bad news right now," Matthews declares, citing...

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Every time Warren Buffett does something, a legion of Buffett-watchers immediately pass judgement on whether the world's most-admired investor has finally lost his mind.

Well, he hasn't, says one of the smartest of those Buffett-watchers, hedge-fund manager Jeff Matthews, the author of "Pilgrimage to Warren Buffett's Omaha."

Buffett's $44 billion bet on a railroad--the biggest bet of his career--is a long-term play on economic recovery and, possibly, global warming.  And it includes a nice potential option in the form of 32,000 miles of rights-of-way that could eventually form the backbone of a nationwide broadband network.

Buffett's Burlington bet probably won't earn the same eye-popping returns of some of his earlier investments, says Matthews, founder of Ram Partners and author of the popular blog, Jeff Matthews Is Not Making This Up.  He paid (relatively) a lot for it, and railroads aren't a major growth business.

But considering Buffett's desire to put a massive amount of money to work and earn a decent return, this seems like a typically smart play.

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With American voters going to the polls today in key elections, a lot is at stake, including whether to continue Democratic rule in two states and President Obama's overall influence.

The timing couldn't be more crucial. "State and local governments have picked up the slack where companies and consumers have stopped spending," says our guest Diane Garnick, investment strategist at Invesco, which has more than $400 billion of assets under management. 

But as local municipalities continue spending, key tax bases are shrinking as real estate remains weak and unemployment rises. In a nutshell: local coffers are shrinking.

"This S&L crisis is likely to be the state and local government," says Garnick, who says Americans should prepare for higher local taxes and all kind of creative "user fees." 

More bailouts? Looking ahead, Garnick says it's not difficult to imagine direct bailouts for states, when taxpayer-funded rescues were made available for the private sector.

So the good news for investors. Now is the time to invest in municipal bonds...

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