Data on new unemplylment claims for the previous week was released, as usual, on Thursday. It again stayed in the yearly range of 351,000-392,000 each week: the same range new unemplyment claims have been in all year (ignoring the week where California was LFT OUT, but the diosishonest Labor Dept. just adjusted future data rather than correctin its ERROR--see the previous articles on the subject in this blog)..
But Sandy is about to make this weekly data pretty much useless for some time, if it has not alrady done so. How many unemployment offices int the Northeast have been CLOSED? How has processing of new unemplyment claims been affected? California really had NO excuse. New York and New Jersey do not have a problem with excuses. Then there is teh unemployment that is CAUSED by Sandy, and its aftermath. My younger daughter, living in Manahttan, says that resturants and businesses in lower Manhattan are STILL CLOSED, although the building (right next to the "Freedom Tower" ) in which her major New York/Boston law firm has its New York offices at least got its powr back this week. There will, of course, be csome employment CREATED by the rebuilding and clean up from Sandy However, there has been a MAJOR economic disruptiong. This not only distorts data which may only be temporary, to some degree, but gives Wall Street peole (theStupidest People on Earth) and media people (contending for same tkitle) the cance to SPIN any unfavorable data.
You can tell something trange was going on Thursday because the dishnoenst Labor Dept. did not even bother to repeat its consistent 3,000 person "error". As you know, if you read this blog, the Labor Dept. has been reporting, and the media liears putting in their headlines, 3,000 FEWER new unemplyment claims almost every Thursday than the REVISED number released the next Thursday. This Thursday, hoever, for the first time in MONTHS, the REVISED number (9f the 363,0000 number released the preivous Thursday) was the SAME as the UNREVISED 363,000. That is the first time this has happened in MONTHS. I don't even remember, and can't even estimate, the last time the REVISED number went DOWN. It just does nto happen (proving conclusively the number is dishoenst). Oh, the UNREVISED number of new unemplyment claims released this last Thursday, was 355,0000 "down" 8,0000 from that 363,000 number (unchanged from the number originaly released, which really is unusual). Will the REVISED number for this last Thursday be 358,000, or more, or is the Labor Dept. going to deviate from its prior pattern? We will see, but it probably does not matter.
As stated, thease weekly numbers are just not oing to mean anything until at least the new year. In the first place, the "sasonal adjustments" are SUSPECT approaching the holiday season, aand in the November-January period,. which includes both Thanksgiving and Christmas. Since we are strarting to "prepare" for Christmas EARLIER every year, the seasonal effect may not be properly accounted for as early as Octobe now. When you add Sandy on top of the fact that the Labor Dept. has a paoblem with the weekly seasonal adjustment fittting the current seasonal pattern, this weeky number of new unemplylment claims simply will not have meaning until at least mid-January. I amy comment briefly each week, but these volatile weekly numbers are just going to be too distorted for reliable analysis (beyond the analysis that they are pretty much meaningless).
Say we get another media headline of a new "four year low", or some such thing? YHou wil know it is FICTION. There is just now way that the economy can IMMEDIATELY IMPROVE with Sandy (not to mentin al of the other problems loming). Just like any HUGE increase in the weeky number of new unemplyment claims may be fictin, and suppoed huge DECREASE has to be fictin as well. Too many things going on. Temporary emplyment not related to Christmas, but to Sandy. Temporary UNEemloyment related to Sandy, and business problems arising from Sandy (some not so "temporary"). The Wall Sreet LIE is to assume Sandy will be GOOD for the economy, as Wall St. seemed to assume right after Sandy (when stocks went up). Not true. Sandy will surely be a NET NEGATIVE, but not in ways that can really be predicted (especially in the timing of the effect on data, and the magnitude). The questin about Sandy is whether our economyh is so FRAGILE that we can slip at any time into a dOWN SPIRAL. We had GOOD WEATHER last fall and winter. That HELPED the economy, although not enough to keep the economyh from beng STUCK.
So individual data points are nto going to have much meaning, or much "predictability". However, Sdndy is just another factor that puts our econmy in DANGER. What if we have a BAD WINTER? We really are in a fragile place, and the Obama/Bernanke policies have made it certain we will remain in that situatin for the indefinite future--EXCEPT, of curse, if the "fragility" is fully exposed by COLLAPSE.
P.S. No proofreading or spell checking (bad eyesight).