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The Untold Story - Emergency Unemployment Compensation Claims Surge By 265k In One Week

Tyler Durden's picture




 

Even as CNBC, which seems to be unaware it is now under new ownership and can stop selling GE stock all day, every day (will Cramer be allowed to pump the worthless equities of competitor cable and satellite companies going forward? Inquiring minds want to know), could not stop praising the fabulous improvement in continuing claims which plummeted by a whopping 5,000 from 462k to 457k, one number that everyone ignored, is the explosion in Emergency Unemployment Compensation - yes, the same name for insurance benefits as they roll beyond their standard expiration horizon, and which the Administration is set on extending to cover a period from now to infinity. That number skyrocketed by 265,300 in one week to an all time record of 3,859,553 for the week ending November 14, from 3,594,253 in the prior week. The chart below does the collapse a little more justice.

In light of this massive divergence in jobless trends, an eager Kool Aid drinking world is expecting Goldman's Jan Hatzius to provide a forecast (with at least 10 significant digit precision) ahead of tomorrow's NFP number. Jan, don't let the Goldman prop trading desk down!!!

Here is a primer on EUC :

The EUC program was created on June 30, 2008, by the Supplemental
Appropriations Act of 2008 (P.L. 110-252). It made up to 13 additional
weeks of federally-funded unemployment benefits available to unemployed
individuals nationwide who had already collected all regular state
benefits for which they were eligible and who met other eligibility
requirements.

On November 21, 2008, the Unemployment Compensation Extension Act of
2008 (P.L. 110-449) expanded EUC to 20 weeks nationwide and created a
second tier of 13 more weeks of EUC for individuals in States with high
unemployment rates.

On February 17, 2009, the President signed the American Recovery and
Reinvestment Act of 2009 which extends the period of time during which
claims for EUC can be filed and benefits paid.

For information about how to apply for EUC, please see the map below
which provides links to the websites for each state agency
administering the EUC program.

 

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Thu, 12/03/2009 - 14:35 | 151038 AnonymousMonetarist
AnonymousMonetarist's picture

by DAVID LEONHARDT
New York Times November 6, 2009

With the release of the jobs report on Friday, the broadest measure of unemployment and underemployment tracked by the Labor Department has reached its highest level in decades. If statistics went back so far, the measure would almost certainly be at its highest level since the Great Depression.

In all, more than one out of every six workers — 17.5 percent — were unemployed or underemployed in October. The previous recorded high was 17.1 percent, in December 1982.

This includes the officially unemployed, who have looked for work in the last four weeks. It also includes discouraged workers, who have looked in the past year, as well as millions of part-time workers who want to be working full time.

Officially, the Labor Department’s broad measure of unemployment goes back only to 1994. But early this year, with the help of economists at the department, The New York Times created a version that estimates it going back to 1970. If such a measure were available for the Depression, it probably would have exceeded 30 percent.

Probably? If Mr. Leonhardt had petitioned the economists at the Grey Lady to utilize the toolkit of 'frontal lobe meets opposable thumbs' they could have coaxed Mr. Google into revealing that during the First Great Depression the Unemployment Rate peaked at 23.53% in 1932, 24.75% in 1933 and 21.6% in 1934.( Source :U.S. Bureau of the Census, Historical Statistics of the United States, Colonial Times to 1957)

However during the First Great Depression the Unemployment Rate counted everyone over the age of 16 that did not have a job.

So how exactly would the First Great Depression 'underemployment' measure reach 30 percent Mr. Leonhardt?

In 1916 the Child Labor Act passed, setting a national minimum age of 14 in industries producing nonagricultural goods for interstate commerce or for export and the Keating-Owen Act passed, forbidding the transportation among states of products of factories, shops or canneries employing children under 14 years of age, of mines employing children under 16 years of age, and the products of any of these employing children under 16 who worked at night or more than eight hours a day.

Maybe if you counted every 'underemployed' teenager you could reach Mr. Leonhardt's projection.

With one out of six Americans on the dole and with half of all of America's children at some point on food stamps, nowadays there is a 'desperation put' from the long-fingered Hand. You won't see someone selling apples on the corner .. Ipods? Maybe.

A more accurate measure of unemployment is the SGS Alternate Unemployment Rate, as tabulated by John Williams at shadowstats.com, which reflects current unemployment reporting methodology adjusted for SGS-estimated "discouraged workers" defined away during the Clinton Administration. 

Up until the Clinton administration, a discouraged worker was one who was willing, able and ready to work but had given up looking because there were no jobs to be had. The Clinton administration 'disappeared ' about five million discouraged workers who had been so categorized for more than a year.

And surprise, surprise,surprise, the participation rate peaked during the Clinton Administration.

Why? Gosh no one knows...

Northern Trust Company 
January 10,2006:

Noteworthy Aspects About the Participation Rate (2000-2005)

The labor force participation rate has dropped each year in the 2000-2004 period and held virtually steady in 2005. This is an atypical event because during economic recoveries the participation rate rises as more people enter the labor force. There is no conclusive research explaining the reasons for the downward trend..

More folks in prison, more disability payments, less baby boomers ... not much in the way of a definitive 'official' explanation has been made as to why folks seem to keep on disappearing and never coming back (in aggregate and most especially if one considers population growth.) 

Where did you go Joe?

Two sentences reveal the truth.

After World War 2, our blessed leaders, impressed by German 'organizational' skills crafted a policy of manufacture of consent.

Over time these techniques moved to the economic realm in an attempt to manufacture content.

With the latest employment bloodletting, The SGS Alternate Unemployment Rate is 22.1%. 

One might argue that this still is not as inclusive as the First Great Depression metric of those of workin' age that ain't workin' ... but it is close enough to support the thrust of this entry and frankly this blog in general.

The manufacture of contempt : it is only a Great Depression if they say it is.

Thu, 12/03/2009 - 14:55 | 151081 Smokey
Smokey's picture

Our economy, our net worth, our way of life, our well-being - it's all summed up here guys:

http://www.youtube.com/watch?v=a3xsDv6yCnY

Thu, 12/03/2009 - 14:39 | 151048 DaveyJones
DaveyJones's picture

What a combo - Keiser interviews Taibbi

suggests instead of food stamps, hungry taxpayers should be given GS stock

http://maxkeiser.com/

Thu, 12/03/2009 - 14:57 | 151087 lizzy36
lizzy36's picture

Instead of speaking about jobs Obama is starring in an infomercial about the success of his administrations economic policies. 

Thu, 12/03/2009 - 15:06 | 151103 Gilgamesh
Gilgamesh's picture

CONfidence numbers are at an all-time high.

What made you think that there was going to be a press conference to discuss jobs?

Thu, 12/03/2009 - 15:45 | 151214 TheGoodDoctor
TheGoodDoctor's picture

"Santa Claus is coming to towwwwwwwnnn...... He knows if you've been sleeping, he knows if you're awake, he knows if you've been bad or good........"

Thu, 12/03/2009 - 17:43 | 151448 heatbarrier
Thu, 12/03/2009 - 15:01 | 151092 HonestJohn
HonestJohn's picture

tryin to soothe the masses

Thu, 12/03/2009 - 15:17 | 151130 Handle with care
Handle with care's picture

That's only part of it.  One of the most successful propaganda campaigns has been to convince the American people that economic misfortune is always the individuals fault and is due to personal failings specific to the individual.

 

So they put out a message that the economy is not in outright collapse so that they can send out the simultaneous message that if your living standards have declined, if you can't get a job, if your kids are on food stamps, if you live in fear due to lack of health insurance, if you live under a mountain of debt that was needed for housing, school bills, health care bills, kids school bills, etc, if you're not doing as well as your parents had at the same age, then its all your fault as an individual and nothing to do with the system having being changed to favor the superrich.

 

By persuading Americans to direct the blame on to themselves they both prevent it being directed onto them while simultaneously paralysing with self-loathing exactly those people suffering most from an unjust and manipulated system and most justified to revolt and also preventing the victims of an oligarchical kleptocracy from uniting to better their lot as they refuse to associate with other "losers" who they have been programmed to believe are worthless as human being due to their lack of economic success

Thu, 12/03/2009 - 15:21 | 151143 ghostfaceinvestah
ghostfaceinvestah's picture

Plus, if you walk away from your status as a debt slave on your underwater mortgage, you are somehow "immoral".

Forget that our immoral government is putting you into those mortgages, and out immoral govt arms Fannie and Freddie guarantee those mortgages, and our immoral Federal Reserve owns the mortgages.

Thu, 12/03/2009 - 15:24 | 151150 WaterWings
WaterWings's picture

I have to remind myself each day. They sure have the American public feeling like an abused housewife.

Thu, 12/03/2009 - 15:27 | 151161 Handle with care
Handle with care's picture

Yes, individuals are supposed to not exercise their legal option to walk away, even though the bank has priced that option into the mortgage rate and has no hesitation whatsoever at exercising any and all options it has in the contracts to maximise its own economic outcome.

 

The owners of capital meanwhile see nothing wrong in pocketing the winnings from any bets they make then bribing politicians to steal (which is what unjust use of tax funds is.  Remember taxes are ultimately collected with the barrel of a gun) other people's money to make them whole on their losing bets.

Thu, 12/03/2009 - 15:39 | 151197 ghostfaceinvestah
ghostfaceinvestah's picture

You are viewing it exactly the right way - it is a default option.  It IS priced into the note rate.  You have the right to exercise that option.

Thu, 12/03/2009 - 17:17 | 151405 Cognitive Dissonance
Cognitive Dissonance's picture

I always find it interesting that violence always flows down the hill, from the powerful on to the weak and disenfranchised.

The same goes for the so called "moral duty", only in reverse. The weak and disenfranchised always have a moral obligation to abide by the law and pay their bills. The higher up the food chain you go, the less talk you hear about "moral" obligation and the more you hear about "it's just bidness."

Thu, 12/03/2009 - 15:05 | 151102 Overpowered By Funk
Overpowered By Funk's picture

On a side note: Steve Liesman continues to marvel at the improvement in current economic conditions. Bernanke is still a genius.

Thu, 12/03/2009 - 21:17 | 151733 Anonymous
Anonymous's picture

The moment i read LIESman in your post i KNEW the remainder would be total hot-n-fresh BS.

(Note: not criticizing Overpowered By Funk of course, it is LIESman who should be taken to task).

Thu, 12/03/2009 - 15:09 | 151108 Tommy
Tommy's picture

At least Obama created 30,000 new American Jobs...in Afghanistan.

Actually the number is closer to 100,000, when you include Blackwater, KBR et all.

We should start selling war as a jobs program... ;-)

Thu, 12/03/2009 - 15:16 | 151126 Overpowered By Funk
Overpowered By Funk's picture

I'm sure that idea is under serious consideration - it seems to be their only alternative.

Thu, 12/03/2009 - 15:19 | 151133 Anonymous
Anonymous's picture

I have worked in WA state for near 30 years and at our trade association for over 20. However, I just learned this week that, yes, you can collect unemployment if you VOLUNTARILY leave your job and don't find another one within 9 weeks. Now I can understand collecting umemployment after having been laid off, but if you leave a perfectly good job? This is such BS and a good reason that s*** will never be solved.

Now I understand we have other problems here, especially as one learns that we are the preferred dumping ground for other state's parolees, but enough is enough already.

Thu, 12/03/2009 - 16:39 | 151304 earnyermoney
earnyermoney's picture

maybe the person has a large sum of money tied up in their employers crappy 401K and they want to have personal control. The only way you can get access without a penalty is loss of job, correct? Just a thought.

Thu, 12/03/2009 - 15:31 | 151175 primus
primus's picture

Heh. Exactly. 

If you are hungry, go sign up to 'be all that you can be' and kill for the empire. Think of all the jobs Obama saved on top of the ones he 'created'. All those factory workers churning out hum-vee's, kevlar vests, night vision scopes, M-16's and tomahawk missiles? Not to mention the other gluttonous 'defense' contractors like Raytheon, Northropp-Grumman and Boeing.

It is only a matter of time until the resource wars really heat up and the USA starts 'creating' jobs in Iran and parts of Eastern Europe.

Thu, 12/03/2009 - 15:41 | 151202 ghostfaceinvestah
ghostfaceinvestah's picture

War has always been a way to destroy production and thus support an economy.

You can bet your ass the current economic situation was a consideration when Obama decided to sacrifice 30,000 more of our youth.

Thu, 12/03/2009 - 15:54 | 151240 primus
primus's picture

Well, you know what they say.

"Guns will make us powerful, butter will only make us fat." ~ Herman Göring

Fri, 12/04/2009 - 20:17 | 153383 Anonymous
Anonymous's picture

He would be the one to know the morphine/pill addict glutton.

Fri, 12/04/2009 - 20:14 | 153374 Anonymous
Anonymous's picture

I though all that military equipment stuff was offshored to China or India or Mexico.

Thu, 12/03/2009 - 15:44 | 151211 cougar_w
cougar_w's picture

Doing just that got us out of the First Great Depression.

The Japanese had a "lost 20 years" recession only because constitutionally they couldn't start a war. Not so for the USofA; we can start anything we damned well please, and don't have to impress anyone to do. FWIW I don't approve, but that's how it will play out if it comes right down to it.

cougar

Thu, 12/03/2009 - 15:50 | 151226 TheGoodDoctor
TheGoodDoctor's picture

My thought was that it makes it easier to help out when the Iran situation breaks out. I don't know if I saw it here, but there was a map of all the bases around Iran. I found it mildly amusing.

Thu, 12/03/2009 - 16:07 | 151256 Scarecrow
Scarecrow's picture

I disagree Cougar. The near total destruction of the rest of the developed world's manufacturing capacity left the US as the only exporters left when the war stopped. War may distract the nation from it's unemployment problem by removing working age people from the country, but war produces no additional goods or services for our economy, it only uses them, so it adds no benefit and creates no additional wealth. Only jobs that produce something or add value create wealth. War destroys wealth, it doesn't create it.

Thu, 12/03/2009 - 18:24 | 151512 Tommy
Tommy's picture

Hence my original sarcasm

Not since Midieval times has war's spoils outweighed what it spoils.

Fri, 12/04/2009 - 09:26 | 152164 Anonymous
Anonymous's picture

I will respectfully disagree, war does make wealth.... if only for a certain select few.

Thu, 12/03/2009 - 16:35 | 151297 Anonymous
Anonymous's picture

That is called a draft. The sole purpose of a draft is to remove as many sources of potential trouble as one can in order to protect the elite establishment during times of potential civil unrest.

Often, this goes unchecked (how do you quantify this?) and hence, political changes are often sweeping, broad, and impact those serving in the draft the worst.

When the "average-joe" catches wind of the actions of the elite establishment, expect a draft in short order. Start expecting.

And here you thought it was to protect the Constitution... sucker.

Love,
Monopoly Banker

Thu, 12/03/2009 - 16:50 | 151326 pbmatthews
pbmatthews's picture

That is afterall how America got back to work after the Great Depression.  Nothing like sending 5 million middle age men to the front lines to alleviate joblessness.

Thu, 12/03/2009 - 15:13 | 151117 AN0NYM0US
AN0NYM0US's picture

He (Bernanke) nearly let the employment number slip "we don't expect... ah I don't have that number"

Thu, 12/03/2009 - 15:16 | 151123 Michael
Michael's picture

OT

CNN, NBC, ABC, CBS, and others need to be investigated and indicted as accomplices in the Climategate fraud, and have their FCC licenses revoked for their participation in perpetuating the fraud.

The power of the MSM to influence the minds of the public and brainwash the listeners is a documented scientific fact therefore, they must be held to a higher standard when broadcasting and be held to account for the lies of omission they take part in as well as the pervasive political one sided agenda they push. 

FCC rules have been violated by not reporting on the Climategate scandal and their crime is obvious. The public must demand an investigation of the MSM.

Thu, 12/03/2009 - 17:40 | 151440 geopol
geopol's picture

How infantile is American society?  Last night's CBS "Business Update" (in the midst of its "60 Minutes" program) featured three items: 1.) The New Moon teen vampire movie led the weekend box-office receipts; 2.) Cadbury shares hit an all-time high; 3.) Michael Jackson's rhinestone-studded white glove sold at auction for $350,000. Some in-house CBS-News producer is responsible for this fucking nonsense.  How does he or she keep her job? Is there no adult supervision?

Meanwhile, over at The New York Times this morning, Paul "Nobel Prize" Krugman writes:

"Most economists I talk to believe that the big risk to recovery comes from the inadequacy of government efforts; the stimulus was too small, and it will fade out next year, while high unemployment is undermining both consumer and business confidence."

     Disclosure: I'm not one of the economists that Mr. Krugman talks to (nor am I an economist). But it's sure interesting to know that the ones palavering with Mr. Krugman imagine that that the US can possibly return to an economy based on the fraudulent securitization of reckless debt. Does Mr. Krugman think that the production housing industry can resume paving over the nether exurbs with half-million-dollar houses (to be bought with no money down loans by the sheet-rockers working inside them)? Does he think all those people receiving cancellation notices from their credit card issuers are in a position to flash their plastic at the Gallerias this Friday? Or ever will be again?  Is he perhaps misusing the term "recovery?"  After all, that is generally taken to mean resuming a prior state, which is, in turn, presumed to be a healthy prior state.  Is that what the economy of the past decade was?  And, incidentally, what exactly is a "consumer?"  And why, at the highest levels of journalism in this land, do we refer to citizens that way?  As if the American people have no other purpose except to buy things? Or is that the only way an "economist" can imagine them?

     I'm sorry to burden the reader with so many questions, but the idiots running the mainstream news media in this land are not doing it and somebody has to.

JHK

Thu, 12/03/2009 - 19:27 | 151608 Anonymous
Anonymous's picture

When facts appear less than innocuous,
When rumors are tantamount to exposure,
When cold logic exposes scheme's perpetuation,
When obedient masses go flinty,

Doublethink & Newspeak to the rescue!

Thu, 12/03/2009 - 20:12 | 151658 faustian bargain
faustian bargain's picture

Krugman needs some serious public discrediting.

Also apparently he needs smarter friends.

Thu, 12/03/2009 - 22:25 | 151807 geopol
geopol's picture

Amen, Brother

 

Fri, 12/04/2009 - 20:31 | 153393 Anonymous
Anonymous's picture

Many years ago I was working at a cheap television station when a Sixty Minutes program on Gun Control was part of our feed. The station owners were against gun control so they ordered the crew to hook up a special effects generator & broadcast 'snow' instead of the program that they found offensive. For the record I am also against gun control but I dearly love all of the bill of rights. I reported this censorship to the FCC & they told me it was none of my business & that they saw nothing wrong with what the owners had done. Fact is they are like the FED, they do as they are told, PERIOD.

Thu, 12/03/2009 - 15:16 | 151124 Dixie Normous
Dixie Normous's picture

In exchange for a sit down meeting with Timmay G this morning, CNBC promised:

Not to dicuss continuing claims;

Not to discuss Emergency UE Comp;

Not to discuss any retail numbers (unless they are GREAT); and

Not to discuss BAC, unless it is to say how wonderful they are or will be when they supposedly pay back the taxpayers.

Thu, 12/03/2009 - 15:19 | 151132 ghostfaceinvestah
ghostfaceinvestah's picture

Thanks for highlighting these numbers, the "continuing claims" number is one of the most abused statistics in the misinformation campaign, given it only counts state unemployment programs (26 weeks, where in many states you can get 99 weeks total now).

At some point, soon, the number of people on the extended benefits will be greater than those on the state benefits ("continuing claims").  Right now it is 3.86M vs 5.54M SA 4 week moving average.

Also, that 3.86M is EUC, does anyone know what the "extended benefits" row with 600M people represent?

Thu, 12/03/2009 - 15:21 | 151142 bugs_
bugs_'s picture

Get out in front of it (Unless its someone be walkin the plank ARrrrrrr)

Thu, 12/03/2009 - 15:31 | 151174 Racer
Racer's picture

and the HEWWWGE drop in jobless of 5000 was hmmm let me think .... wasn't last week the week when the counters of the numbers had a day or so off?

 

 

Thu, 12/03/2009 - 15:37 | 151190 crosey
crosey's picture

Good catch Racer.  40% of the week off for holiday.

Thu, 12/03/2009 - 15:38 | 151191 Hammer59
Hammer59's picture

Bravo, Handle with care. Excellent insight.

Thu, 12/03/2009 - 15:45 | 151216 Hephasteus
Hephasteus's picture

Isn't it strange that 17.5 percent are unemployed and underemployed and 17.5 percent are unbanked or underbanked. I mean the nerve of people losing thier jobs thier houses their cars and then feeling no need to have a bank account. The system is supporting you and they go and shirk their duties.

Thu, 12/03/2009 - 16:00 | 151249 Anonymous
Anonymous's picture

This is all fine with Obama. The more people who get their 'paycheck' directly from him the better.

Notice also the explosion in 'paid volunteerism'.

Notice also the explosion in governmental hiring.

Thu, 12/03/2009 - 16:41 | 151307 Anonymous
Anonymous's picture

It's just because they recently rolled out the third tier benefits, in GA at least. I'm sure other states are on about the same time-line.

Thu, 12/03/2009 - 17:00 | 151355 Anonymous
Anonymous's picture

and that's with only 7 states reporting!

Thu, 12/03/2009 - 22:19 | 151799 Anonymous
Anonymous's picture

I don't understand emergency continued unemployment benefits. Here in socialist Canada it's EI for maybe one year and then welfare or you wash dishes.

Thu, 12/03/2009 - 22:28 | 151812 Anonymous
Anonymous's picture

The number was down by 5000 because of Thanksgiving week. Duh!!! Who the hell goes to the unemployement line on Thanksgiving or the day after. The reality is, that if it wasn't Thanksgiving week, the number would have been more, not less. Common sense.

Thu, 12/03/2009 - 23:29 | 151889 Anonymous
Anonymous's picture

You're watching the fail of America happening right before your eyes.

-MobBarley

Fri, 12/04/2009 - 11:13 | 152352 Anonymous
Anonymous's picture

I posted an article on this very subject in early September. Here's the link.

http://www.harnessimg.com/blog/2009/09/dig_a_little_deeper

Fri, 12/04/2009 - 11:13 | 152353 Anonymous
Anonymous's picture

I posted an article on this very subject in early September. Here's the link.

http://www.harnessimg.com/blog/2009/09/dig_a_little_deeper

Fri, 12/04/2009 - 11:19 | 152368 donyocham
donyocham's picture

I posted an article on this subject back in early September.  Here's the link.

http://www.harnessimg.com/blog/2009/09/dig_a_little_deeper

Mon, 12/14/2009 - 14:41 | 163433 Anonymous
Anonymous's picture

prob a stupid question but the EUC's are not included in the weekly "headline" continuing claims number?? my question is basically answered by this chart b/c if they were, the chart would be double counting but just want to make sure...thanks!

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Anonymous's picture

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