If you follow business media, you were probably enthused this morning to hear that jobless claims had improved based on the latest Department of Labor (DOL) report. In fact, you might even have attributed the stock market’s broader bounce to it. But you would be wrong, as it was all hoopla drummed up by producers who had no real clue as to why stocks were higher. Alas, this is why I am here… to make sense of it all for you.
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Big deal! Weekly Jobless Claims improved by 7,000 in the period ending August 6, but they were still up near 400K, at 395K to be exact. I mean, I would have thought my long cursed Philadelphia Eagles had won the Superbowl or that I had won the lottery the way the news was being read to me this morning. This was more akin to Marley, my Maltese friend, choosing not to poop on the bathroom floor. It was that kind of good news… you see the difference.
The four-week moving average of weekly jobless claims illustrates the general malaise in the labor market, improving by just 3,250, to 405,000. Hey, the insured unemployment rate improved by a tenth of a percentage point, to 2.9% in the period ending July 30! Sit back down now; we’re not chilling the champagne just yet.
Don’t think I have not noticed, though, that the number of people receiving benefits continues to decrease. The pool of the insured unemployed shed 60K in the latest check-up, and the number of people receiving a benefit of some sort, including extension benefits, dropped 89,945 in moving to 7.48 million.
"The unforgiving “system” then throws them out on the street without a dime nor dignity."
The problem is that I suspect people are simply losing their benefits, more so than finding work. This is how it goes in the government benefits game. There are a million rules set up to inspire the unemployed to keep seeking work, versus bumming around collecting free money. What happens all too often instead though is that people, being human, get tripped up by the net of government rules and regulations. The unforgiving “system” then throws them out on the street without a dime nor dignity. So, they fall out of the government count, presenting illusion of improvement where an even more indignant state exists than the previous. What will be end result of all this, if not the kind of riots and protests that we see occurring today in the United Kingdom and Greece. I think it will not be long before MoTown Mobs gather.
As always, the state data details:
The highest insured unemployment rates in the week ending July 23 were in Puerto Rico (5.5), Pennsylvania (4.2), New Jersey (4.1), Alaska (3.9) California (3.9), Connecticut (3.8), Oregon (3.8), Rhode Island (3.7), Nevada (3.6) and Arizona (3.4).
The largest increases in initial claims for the week ending July 30 were in Minnesota (+472), Kentucky (+393), New Jersey (+291), Delaware (+64), and Vermont (+50) while the largest decreases were in Tennessee (-4,448), Michigan (-3,025), Florida (-2,336), New York (-2,132), and Texas (-1,828 ).
Extended benefits were available in Alabama, California, Colorado, Connecticut, Delaware, the District of Columbia, Florida, Georgia, Idaho, Illinois, Indiana, Kansas, Kentucky, Maine, Massachusetts, Michigan, Minnesota, Missouri, Nevada, New Jersey, New Mexico, New York, North Carolina, Ohio, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Washington, West Virginia, and Wisconsin during the week ending July 23.
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