Investors: Jobs report doesn't change much

• Federal Reserve unlikely to raise rates any time soonWorries about tax hikes, spending cuts haven't resulted in layoffs -- yet

The economy continues to chug along, despite a storm-racked November employment report. And that's good news for the markets and for investors -- assuming Congress doesn't wreck the economy this month.

Employers added 146,000 jobs in November, vs. 138,000 in October, the Bureau of Labor Statistics reported Friday. The unemployment rate fell to 7.7% from 7.9% in October.

The report painted an unusually muddied picture for investors. The government said Superstorm Sandy didn't have a substantial impact on November's numbers, but Moody's Analytics chief economist Mark Zandi says it sent an estimated 85,000 into sudden and unexpected unemployment.

Without the effects of the megastorm, the economy would have added about 150,000 jobs -- roughly the average monthly number of jobs added this year.

The good news: Manufacturing has yet to start shedding jobs, even though they have pulled back on investment, Zandi says. "I don't know how long that will last, though," he says.

"It's a treading-water jobs report," says Greg McBride, senior analyst for Bankrate.com. "The unemployment rate went down, but not for the right reasons." The main reason the unemployment rate fell, McBride says, is because fewer people were in the labor pool.

Assuming Congress comes to an agreement about looming tax hikes and spending cuts, investors have little reason to change strategies. At current unemployment levels, it's unlikely that the Federal Reserve will raise short-term interest rates, so savers will still get minuscule interest from money market funds and bank CDs.

And, says McBride, it's now more likely the Fed will announce a new program of buying bonds on the open market to keep longer-term rates low -- good news for home owners who want to refinance their mortgages. The current average 30-year mortgage rate is a rock-bottom 3.34%, according to mortgage giant Freddie Mac.

It's also good news for stock investors, because lower rates make stocks more appealing compared to ultra-low bond yields. The Standard and Poor's 500 stock index currently has a dividend yield of 2.2%, above the bellwether 10-year Treasury yield of 1.59% -- usually an excellent buy signal for stocks.

The big fear for investors is that businesses will start to lay off workers in anticipation of a congressionally created recession. If Congress doesn't act by Dec. 31, tax rates will rise and spending will be slashed -- enough to throw the economy into a recession, according to the non-partisan Congressional Budget Office.

A recession, in turn, would mean thousands more people out of work, slowing consumer demand further. Stocks and commodities would fall, as would low-quality, high-yielding junk bonds. Treasury securities, however, would probably rise in price and fall in yield as investors seek safety.