The July jobs report was ugly, but stocks went up anyway — bad news for workers, oddly cheered by investors.

• The US economy lost 23,000 jobs in July, way short of the 83,000 gain that was expected.
• Wages were basically flat, and fewer Americans are working or even looking for work — the lowest participation in over five years.
• Earlier months were revised down too, dragging the past year's average job growth to a weak 34,000 a month.
• Wall Street rallied on the bad news, betting a weak economy means the Fed won't hike rates — even as inflation still creeps up.
• Weak jobs plus rising prices points to stagflation, the worst-case mix, and some big investors like Ray Dalio are warning of a bubble.

Outlook: If hiring keeps slipping while inflation stays high, the risk of stagflation grows and the market's optimism could snap.