900,000 Americans filed for unemployment benefits last week.
Believe it or not, that was actually a beat versus consensus, which was looking for 935,000.
You’ll recall that the previous week’s report was a disaster. Initial claims “unexpectedly” approached 1 million again, logging the largest rise since March. That print (965,000) was revised lower to 926,000 in this week’s release.
Obviously, this is not a “good” report. It’s “better” than economists and the market expected, but with apologies to market participants, that is meaningless right now. Initial claims have just logged a second consecutive weekly print of 900,000. That’s a disaster. The four-week moving average is now 848,000.
Among other things, this means is that, in all likelihood, the US will look up a month from now and find that initial claims are still running above the pre-pandemic record a year into the crisis. That’s a failure of government. There’s just no other way to describe the situation.
Continuing claims for the week ending January 9 were 5.054 million. Again, that’s “better” than expected, with “better” being about as relative as relative gets.
Initial PUA claims rose 138,848. Continuing PUA and PEUC claims in the week ended January 2 fell to 5.7 million and 3.027 million, respectively.
While I’m sympathetic to analysts whose job isn’t to editorialize, but rather to take the numbers and compare them to previous data and to the trend, I afford no such sympathy to journalists and pundits. Anyone with editorial leeway and not subject to the rigors of bank compliance should describe this situation for what it is: A tragedy.
The idea that the richest nation in the history of civilization which issues the world’s reserve currency should go nearly a full year with weekly initial jobless claims running above 700,000 is ludicrous. It’s stone, cold crazy.
Assuming the media chooses to go the sympathetic route (versus the “better than consensus” route), the boilerplate commentary will likely be that this week’s claims data “underscores the urgency of Biden’s stimulus plan.”
While that’s true, we seem to be missing the forest for the trees. The nation’s infrastructure is in disrepair (to put it generously), food banks need staffing, vaccine rollout needs scaling up, testing needs to be expanded, and the health care system needs all the help it can get right now.
The point (in case it’s somehow unclear) is simply the following. There’s no shortage of critical jobs that need doing. There are millions upon millions of jobless Americans. And the US issues the world’s reserve currency.
You don’t need to be a quant to work out this equation. The federal government should just put people to work doing the jobs that desperately need to get done. You don’t have to worry about how to pay them, because you print money.
Hilariously (or not, depending on what you find funny) there are legions of economists and pundits out there who will tell you that isn’t feasible.
And what is their job? What do they do to contribute to society? Do they build bridges when the bridges aren’t sturdy anymore? Do they staff food banks when millions of families are lined up for miles because they’re starving? Do they go and help the government test and trace in an effort to bring an end to the worst public health crisis since the Spanish Flu?
In most cases, the answer is obviously “no.” Instead, they spend their days explaining to everyone else why something like, say, a federal jobs guarantee isn’t a viable proposition.
That’s easy to say when your job is guaranteed.