economy Markets

Jobless Claims Unexpectedly Rise, Adding To Economic Consternation

742,000 Americans filed for unemployment claims last week, more than the market expected.

It’s an unwelcome development at a time when investors were already concerned about the economic ramifications of lockdown measures imposed across the US as public health officials look warily at Thanksgiving as a possible nationwide, celebratory super-spreader event.

Consensus was looking for 700,000 on the headline initial claims print. The prior week was revised slightly higher to 711,000. The latest figure moves us further away (on the upside) from the pre-pandemic record hit in 1982.

The four-week moving average is (coincidentally) 742,000.

This comes as lawmakers in D.C. continue to show no progress on another fiscal stimulus package for struggling Americans. It is, I believe, entirely fair to suggest that most elected representatives on both sides of aisle simply do not care what happens to everyday people. It’s always about the next chess move and right now, both parties are focused on the Georgia runoffs. If Democrats were to somehow prevail (against the odds), it would open the door to the implementation of Joe Biden’s broader agenda. Until those runoffs are decided, Mitch McConnell, Nancy Pelosi, and Chuck Schumer simply do not know how strong their hand will be.

In the meantime, Americans starve. In some cases literally. It’s a pitiable spectacle, and one I’ve lamented at length of late.

Continuing claims in the week ending November 7 were 6,372,000. That’s inline with consensus, and down from an upwardly revised 6.8 million in the prior week.

PEUC claims look to have jumped again, as the jobless exhaust regular state benefits.

There’s not much to like here. The Philly Fed was a beat versus expectations, but was down sequentially. Current activity, new orders, and shipments gauges all decelerated from October, but the current employment index offered something of a silver lining, printing a post-COVID high of 27.2.

Still, the outlook isn’t great. “The future employment index decreased 10 points to 36.2. Over 41 percent of the firms expect to increase employment in their manufacturing plants over the next six months, compared with 52 percent in October,” the survey says. “The future capital spending index declined 11 points to 25.5.”


 

8 comments on “Jobless Claims Unexpectedly Rise, Adding To Economic Consternation

  1. mfn says:

    Day after day, lines at the local food pantry here on Manhattan’s UWS stretch down and around the block — four, five, six times longer than usual. For months, everything has been outdoors and socially distanced, but the weather is getting colder, and I worry that vulnerable people — and the wonderful volunteers who keep the operation running — will have to choose between a rock and a hard place as November turns into December turns into January. The votes are in and have been counted: Mitch McConnell is the unanimous winner of the 2020 Marie Antoinette Award for Feckless Leadership in a Crisis. Congrats, senator. Well deserved!

  2. John Taylor says:

    Cute way of putting it, but those people are still hungry and still on the street.

  3. calh0025 says:

    “Unexpectedly”. I would have put this in all caps and size 48 font comic sans and red with googly eyes to highlight the immensity of the sarcasm necessary to utilize that word in that sentence.

    I mean I’ve been seeing practically monthly layoff and furloughs with more coming in the future. The stimulus was not enough and what capacity it had to help is long since used up. We were coasting on fumes and now the real economy where people get paid to do stuff is heading into pain town. Any business remotely tied to Oil and Gas basically has seen zero relief with none in sight. That’s ultimately a lot of money leaving the economy. Stocks can go infinite and it won’t actually drive any economic activity.

    • I was going to do that, but the thing is, lots of analysts and journalists that are my friends were compelled by virtue of their professional obligations to use the word “unexpectedly” in their own coverage and I didn’t want anyone to think I was taking a cheap shot at them. Which brings up another point: When you see these “alternative” sites that quote from analysts and the media and you see them constantly throwing shade at folks, and using unnecessary derision, etc., just note that’s conclusive evidence those sites don’t actually know any of the people they quote. Yours truly actually knows folks. Just another thing that separates me.

      • calh0025 says:

        Fair point, compulsion to align with various interests is real and nobody wants to risk their job needlessly. Professional courtesy keeps you more plugged in as well I’m sure.

  4. Anaximander says:

    For the endless rationalizations from various corners (of the ‘bubble’ in every sense of the word) and all manner of twisted, immaculately complex analyses, the FED cannot print revenues or operating cash flow. Small businesses employ almost 50% of the workforce, and a majority of them (along with their owners finances and creditworthiness) are being systematically destroyed as we speak. Nobody cares, as long as their portfolios perform. They say the stock market is not the economy. And yet they simultaneously see imminent demand-pull inflation and expect the starving and destitute to continue to buy the obsolete, non-essential products sold by their dinosaur, bankrupt value stocks. At least they should be consistent.

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