Thursday, March 01, 2012

Jobless Claims Fall Again to March 2008 Level and Could Reach Pre-Recession Levels Within 6 Weeks

Weekly jobless claims fell last week to 354,000 (four-week average), dropping to the lowest level since mid-March 2008 almost four years ago, in another sign of improvement in the U.S. labor market.  This marks the seventh consecutive weekly decline in the four-week moving average, and the 12th decline in the last 13 weeks.  At the average rate of weekly declines over the last three months (-3,350), jobless claims will be back to the pre-recession late-November 2007 level of 336,250 within the next 6 weeks.   

28 Comments:

At 3/01/2012 12:34 PM, Blogger al fin said...

Very clever and creative accounting practises at the US Labour Dept these days, eh, what?

 
At 3/01/2012 12:47 PM, Blogger juandos said...

I agree with al fin...

Only 54% Of Young Adults In America Have A Job

'...when it comes to young adults (18-24) in the US, the employment rate is just barely above half, or 54%, which just happens to be the lowest in 64 years, and 7% worse than when Obama took office promising a whole lot of change 3 years ago'...

 
At 3/01/2012 2:06 PM, Blogger VangelV said...

A few years from now, after all of the carnage and pain of collapse, people will be wondering how it was that so many people could not see the real world as it was. Sadly, more than a few will be pointing to charlatans who made up numbers and the unthinking optimists that put their belief system before the empirical evidence.

Sorry Mark but even with all of the meddling by the Obama administration and the liquidity injections of the Fed I cannot see any real evidence of improvement in real terms. With the ECB and Fed expanding balance sheets and printing there is no way for most people to hope that their savings will allow them the opportunity to retire as planned. The only people who have made money consistently were nimble traders and the investors who looked for real assets for protection. In the meantime the average family has lost after-tax purchasing power and has seen any returns from savings disappear down the rabbit hole of modern finance theory.

 
At 3/01/2012 2:08 PM, Blogger Ironman said...

Projecting the current trend line forward, the number of weekly seasonally-adjusted new jobless claims would reach pre-recession levels around 16 June 2012. (That's on average - there may well be individual data points that drop to those levels much sooner.)

More here on the break of the old trend and the beginning of the current trend, which we've determined took place on 26 November 2012.

As for what caused the break in trend to occur, look for an event that would have a positive effect on employers' employee retention decisions 2-3 weeks earlier....

 
At 3/01/2012 2:23 PM, Blogger Benjamin said...

Vange-

You are beginning to sound like a hysterical Cassanadra. Get a grip, man.

The Fed can print money. Get over it. People accept the money as real. They can pay taxes with it, and that makes it as real as it gets.

Ergo, a collapse like you talk about is nigh impossible, unless some gold-voodoo nuts take over the Fed.

 
At 3/01/2012 2:42 PM, Blogger morganovich said...

bunny-

you do realize that ever dollar they print makes every other dollar previously printed less valuable, right?

sure, the money is "real" in terms of being accepted as legal tender, but each new buck makes all the existing ones a little less so.

ask hungarians, zimbabweans, or argentines how real the money that got printed became.

all i could thing about your response to vangel's first paragraph was "QED".

you are exactly the guy he's talking about.

 
At 3/01/2012 3:17 PM, Blogger morganovich said...

ps bunny-

calling him cassandra is a very poor choice of metaphor.

cassandra was always right and never believed. granted prophesy by apollo, she was later cursed by him for not returning his love and destined to never be believed.

for you to call vangel that and then disagree with him is self refuting.

it appears your classical education is as bad as your economic one.

 
At 3/01/2012 3:26 PM, Blogger Ron H. said...

"The Fed can print money. Get over it. People accept the money as real. They can pay taxes with it, and that makes it as real as it gets"

Wow! I just got a 50% raise, and I thought I would enjoy my greater wealth, but it seems all my bills are about 50% higher also. How can I get ahead?

I see that McDonald's now charges $9.97 for a Big Mac, and I read that their prices are are going up again next week.

Maybe I should get rid of this cash as soon as I can, before it loses more buying power.

Let's see - where did I put that wheelbarrow.

 
At 3/01/2012 4:07 PM, Blogger Benjamin said...

Morgan-

Your understanding of money supply is woefully limited.

If you print more money, but economic activity expanded by an even larger amount, you would in fact have deflation. So every dollar you reprinted would be worth more, in theory.

However, the existence of fiat money can spur production and labor, for obvious reasons.

Milton Friedman expounded on the gold standard, and I refer you to him.. After you read most of his works, please come back here with your tired right-wing bromides and nostrums, which are no better than Krugmanite spend-a-thons for what this economy really needs.

 
At 3/01/2012 4:20 PM, Blogger Ron H. said...

Bunny says: "Morgan-

Your understanding of money supply is woefully limited.
"

LMAO!

That's a good one!

 
At 3/01/2012 4:28 PM, Blogger Ron H. said...

"If you print more money, but economic activity expanded by an even larger amount, you would in fact have deflation. So every dollar you reprinted would be worth more, in theory."

Is that, in fact, what has been happening? If so, why have these huge injections been called "stimulus", rather than "price stabilization"?

You're hilarious today.

 
At 3/01/2012 4:54 PM, Blogger morganovich said...

bunny-

"If you print more money, but economic activity expanded by an even larger amount, you would in fact have deflation. So every dollar you reprinted would be worth more, in theory."

as ever, you seem determined to miss the point.

you are confusing 2 different things.

if output grows and money stays constant, yes, money tends to appreciate. but that does NOT mean that each new dollar you print does not reduce its value.

it does.

it's like punching holes in the bottom of a bucket. it still makes water flow out even if you are are pouring it in faster.

no matter what is going on in the rest of the economy, the impact of printing an additional dollar is ALWAYS to reduce the value of the existing ones. you are confusing a component vector with the aggregate vector and demonstrating once more that you really have no idea what you are talking about.


i realize that holding 2 things in your head at once is difficult for you, but do try to keep up.

your appeals to authority just make you look foolish.

unlike you, i have not only read freidman, but understood it. i also know the limitations of the monetarists and why their policies have so often failed, especially when combined with full employment or growth mandates. you cannot print real growth.

further, your examples have little do do with the real world.

money is growing at roughly 10X real growth. it's value is eroding rapidly, but, as vangel pointed out earlier, you are determined to keep your head in the sand perhaps largely because you understand neither inflation nor money supply but insist upon pretending you do.

 
At 3/01/2012 7:23 PM, Blogger Larry G said...

is "printing money" something new?

I have the impression that we've been doing this for quite a while.

I'm just trying to understand if we are fundamentally doing something different than what we have for quite some time.

 
At 3/01/2012 7:24 PM, Blogger Craig Howard said...

However, the existence of fiat money can spur production and labor, for obvious reasons.

Yes, it can, but unfortunately only to a point.

In an economy with a stable money supply, wages represent all the goods produced. Thus, savings imply goods unsold and still available for purchase. Borrowers from these savings can then purchase from the supply of available goods and resources.

When money is "printed" and lent out, there is no comparable quantity of "saved" goods and thus prices must be bid up as holders of the "old" money compete with holders of the "new." Now, this can go on for a short period of time without terrible disruption, but the longer the credit expansion is in effect -- and the more money that is "printed," the greater that will be the resultant disruption as resources are bid away from their best use to those which only appear good because of artificially low interest rates.

There is no free lunch.

 
At 3/01/2012 7:28 PM, Blogger Larry G said...

the money gets pulled back, taken out of circulation ... also.

It's the basic Monetary Policy for most industrialized countries.

 
At 3/01/2012 8:15 PM, Blogger VangelV said...

m:

"bunny-

you do realize that ever dollar they print makes every other dollar previously printed less valuable, right?"


I do not believe that he does. Like our friend Larry he seems to have a hard time understanding simple concepts.

By the way, I am not getting any notifications of new postings on the threads. Are you having the same problem?

 
At 3/01/2012 8:25 PM, Blogger Larry G said...

well every new dollar printed does decrease the value of previous ones (in theory) but if you can still buy the same goods and services without a major increase in price - what does that mean?

and don't forget ... the FED has ALSO been accused in the past of being to TIGHT with the money supply when they feared inflation, right.

Yep.. the posts are not being reported in email.

 
At 3/01/2012 11:05 PM, Blogger Ron H. said...

"well every new dollar printed does decrease the value of previous ones (in theory) but if you can still buy the same goods and services without a major increase in price - what does that mean?"

That means the new money hasn't been circulated yet. It's still held by banks as reserves, earning interest.

"and don't forget ... the FED has ALSO been accused in the past of being to TIGHT with the money supply when they feared inflation, right."

That is Benji. Don't listen to him, he doesn't know what he's talking about.

 
At 3/02/2012 4:22 AM, Blogger OBloodyHell said...

>>> Very clever and creative accounting practises at the US Labour Dept these days, eh, what?

Yep, I gotta agree with this... the job market isn't looking any better from my POV at all. This is just the magic of Gummint Accounting Practices. Not to EVER be confused with Generally Accepted Accounting Principles.

 
At 3/02/2012 4:25 AM, Blogger OBloodyHell said...

>>> it appears your classical education is as bad as your economic one.

Bad as education is, I'd have to give the educational system the benefit of the doubt, here.

I mean, it's been self-evident for a good while now that Benny performed some highly effective self-trepanning some years ago. This renders any educational efforts rather moot.

 
At 3/02/2012 4:27 AM, Blogger OBloodyHell said...

>>> If you print more money, but economic activity expanded by an even larger amount

I rest my case regarding the above. That the economic activity did NOT expand by an even larger amount doesn't quite factor into his addlepated brain.

The fault lies not within the stars (or benny's education), it lies within himself -- the scrambled neurons in his brain case.

 
At 3/02/2012 4:36 AM, Blogger OBloodyHell said...

>>> no matter what is going on in the rest of the economy, the impact of printing an additional dollar is ALWAYS to reduce the value of the existing ones.

Not exactly, since any increase in the asset values being "represented" by the money supply causes the value of the money to go up if it's not in lockstep with the asset creation --

That is, money is a placeholder for the value of all existing assets at any given instant.

If the net aggregate value of the assets is going up, and the money supply is not, then you are going to have deflation -- every dollar of paper stands-in for a larger amount of value/goods. If you are printing bills faster than the production system is increasing the value it is producing+existing-perished value, then you have inflation -- every dollar of paper stands in for a smaller amount of value/goods.

The flaw is that beeeny's refutation takes it as a given that such an increase might be taking place even if there's no evidence to support such an idea whatsoever.

 
At 3/02/2012 10:02 AM, Blogger juandos said...

"Your understanding of money supply is woefully limited.

If you print more money, but economic activity expanded by an even larger amount, you would in fact have deflation. So every dollar you reprinted would be worth more, in theory
"...

OMG! Now that's funny!

Thanks pseudo bunny, I've not had that good a laugh in quite awhile even considering your previous comments...

Ever consider some remedial economics?

 
At 3/02/2012 10:11 AM, Blogger juandos said...

"Not exactly, since any increase in the asset values being "represented" by the money supply causes the value of the money to go up if it's not in lockstep with the asset creation --

That is, money is a placeholder for the value of all existing assets at any given instant
"...

Well no doubt that is all theoretically true OBH and I have no quibble with it at all...

Now if one wants to delve into today's reality the excess printing of money seems to be problematic...

Consider the following site which I found interesting and if the man's numbers are factual the contents seems more than a bit dismal (more of Professor Mark's bad new porn addiction?): Price in Gold

Site description is: True Prices Measured In Gold

 
At 3/02/2012 11:02 AM, Blogger Ironman said...

Found it! Sorry to say though that the reason for the improvement in weekly jobless claims has now gone away....

 
At 3/02/2012 12:03 PM, Blogger FloridaSteve said...

I still think that talking about the U3 as opposed to the U6 employment charts borders on disingenuous.

http://www.shadowstats.com/alternate_data/unemployment-charts

 
At 3/02/2012 12:21 PM, Blogger juandos said...

"...jobless claims fell last week..."...

O.K. then why are there more new records in food stamps being set?

 
At 3/02/2012 1:06 PM, Blogger Ron H. said...

OBH: "If the net aggregate value of the assets is going up, and the money supply is not, then you are going to have deflation -- every dollar of paper stands-in for a larger amount of value/goods."

The value of each dollar is rising, and it takes more value/goods to purchase them.

"If you are printing bills faster than the production system is increasing the value it is producing+existing-perished value, then you have inflation -- every dollar of paper stands in for a smaller amount of value/goods."

It takes less value/fewer goods to purchase each dollar. The value of each dollar has decreased due to the additional bills printed.

If the value of the production system doesn't change at all, printing more bills will allow each unit of value/goods to buy more of them, hence each existing dollar and each additional dollar is worth less.

What morganovich said.

Of course this assumes perfect information, with no delay in time between printing and revaluation.

 

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