The monthly jobs report from the Labor Department on Friday morning was a shocker: There was no net job creation, and the unemployment rate remained steady at 9.1 percent.. Analysts had estimated that the country had added 68,000 net jobs for the month of August, The Washington Post’s Neil Irwin reported.

2:45 p.m.: Stocks drop to session’s lowest levels

The Dow Jones Industrial Average has dropped 2 percent — 250 points — as stocks continue to tumble. The Nasdaq and S&P 500 were also down about 2 percent, wiping out most of the gains the market made this week.

12 p.m.: The government is the problem

Political bickering and inaction are hurting the markets the most, analysts said, as President Obama prepares to give his speech on job creation next Thursday.

“We’ve had inadequate policy responses to the problem of too much debt, and that makes people concerned,” Mark Travis, chief executive officer of Jacksonville Beach, Fla.-based Intrepid Capital Management Inc., told Bloomberg.

11:50 a.m.: Analysts weigh in on market reaction to jobs report

What do today’s developments indicate about a recession?

“The jobs report was just ugly,” Michael Mullaney of the Fiduciary Trust told Bloomberg in a telephone interview. “We’ve been watching deceleration of economic activity on a global basis. Does that increase the odds of a recession? It’s a coin toss at this point, 50-50. This will probably push the Federal Reserve over the edge.”

Over at Time, Stephen Gandel said you know things are bad when a steady 9.1 unemployment rate is the bright spot of a report.

Steve Blitz, senior economist at ITG Investment Research, told Gandel that the news that more people are taking on second jobs is particularly worrisome. “It's difficult to walk away from these numbers without the conclusion that the economy is simply grinding to a halt,” he said, while other analysts predicted the country is on the verge of another double-dip recession.

CNBC reported that economists are expecting the Fed will announce an ‘Operation Twist’ after its next policy meeting, meaning it will purchase longer-dated Treasurys and simultaneously sell short-dated Treasurys.

11:45 a.m.: European markets close

Germany’s DAX closed down 3.5 percent, the UK’s FTSE closed down 2.25 percent and France’s CAC ended the day 3.6 percent down.

11:20 a.m.: World markets still down

Bloomberg reported that the U.K.’s FTSE 100 Index fell 2.5 percent, Germany’s DAX Index was down 3.8 percent and France’s CAC 40 Index was down 3.7 percent, adding that national benchmark indexes have fallen in every Western European market except Portugal.

11:05 a.m.: Verizon strike, Hurricane Irene

The jobs of 45,000 Verizon wireline workers have affected the jobs numbers in past weeks -- without those workers back on the job, initial jobless claims have not changed much in the last few weeks, CNN reported.

Hurricane/Tropical Storm Irene may also played a roll. Jennifer Lee, a senior economist with BMO Capital Markets wrote in a research note that “the fact that 1.7 million homes and businesses are still out of power along the Eastern seaboard as of Thursday afternoon might have an impact on [next week’s] claims data.”

11:02 a.m.: Analysts say low demand, uncertainty causing ‘paralysis’

Economists told the New York Times that low demand for goods and services plus uncertainty about the economy since the factious debate between congressional Republicans and the White House over raising the U.S. debt ceiling has kept businesses from hiring.

Ellen Zentner, the senior U.S. economist for Nomura Securities, told the paper, “Business confidence surveys have uniformly pointed to businesses who are not laying off workers, but who are holding off on hiring while they wait for a clearer outlook — an outlook that became much cloudier and more volatile” since that debate in July.

10:32 a.m. : Gold prices up again

No surprises here. Gold prices are up about 3 percent on the news of the falling markets — at about $1,854.50 per ounce, according to Bloomberg. Dow Jones reported that price is nearing the Aug. 22 record high of $1,891.90.

10:21 a.m.: BofA, JP Morgan, Goldman Sachs

Another factor that could be weighing on the banking sector today is a New York Times report that the United States is preparing to sue a dozen banks over mortgages. The report, which cited three anonymous individuals briefed on the matter, said the government is focusing on Bank of America, JPMorgan Chase, Goldman Sachs and Deustche Bank and “accusing them of misrepresenting the quality of mortgage securities they assembled and sold at the height of the housing bubble, and seeking billions of dollars in compensation.”

Bank of America stock was down around 7 percent; Goldman Sachs and JP Morgan fell about 4 percent.

10:10 a.m.: QE3?

Will the bad jobs report spur the Federal Reserve to start a new round of quantitative easing? Investors are betting yes if the dollar’s fall against the yen is any indication.

9:55 a.m.: Biggest losses in weeks

These are the biggest losses in weeks. All 30 Dow stocks are down.

9:50 a.m. Solis optimistic

U.S. Labor Secretary Hilda Solis expressed optimism about the jobs situation. “I do feel like we’re going in the right direction,” Solis said.

9:50 a.m. Could things have been worse?

Reuters financial columnist James Pethoukoukis pointed out on Twitter that the unemployment figure would be higher — much higher — if the labor force was as large as it had been in January 2009.

11.4 percent: That would be the U-3 unemployment rate if labor force was as big as when Obama took officeFri Sep 02 13:32:04 via Twitter for BlackBerry®James Pethokoukis

9:45 a.m.: Stock market reaction is ugly

Stocks are falling sharply in the United States and Europe. The Dow Jones, S&P and Nasdaq all fell about 2 percent in morning trading. The Associated Press reported that all three indices had seen their worst August since 2001 as the weakening U.S. economy and debt issues in Europe put investors on edge. In Europe, the major indexes were down between 2 and 4 percent.