Unemployment

The base case number one takes the view that high yield default rates are peaking and will start to drop from this level now. The rate of unemployment ranges from 10% to 11.5% with this given scenario. In the base case number two, I am using a composite of both peaks in 1991 and 2002 to suggest that default rates may carry upward one percent more. The resulting effect on unemployment targets will range from 11% to 13.5%. In our final analysis base case number three will use the peak at 13% in default rates established in 1991. Unemployment rates in this scenario show a range of 12.5% and 15% before possibly peaking.

While Bernanke is criticizing the banks one the one hand, Bernanke is patting the banks on the back with the other hand and giving them a big wink.

Contrary to what you might have heard, higher military spending leads to HIGHER unemployment and lower GDP...

In addition to PPT or other gaming of the stock market, here is another reason it can go up while jobs are crashing downward ...

The ever increasing unemployed are buying Kindles to read all about their predicament.

Major deterioration in both categories, worse than estimates. Market not shooting up for some reason.

The length of time the average unemployed has been without a job has just passed an all time record 26 weeks. This is the longest time average unemployed American has been jobless since this data series has been recorded. In other news, as this data point is obviously unspinnable positively for general consumption, expect the dollar to shortly hit zero, as the stock market approaches to reach infinity.

There were no notable movers in the September BLS State unemployment report: the worst states were the usual suspects: Michigan, Nevada, Rhode Island, California, and South Carolina, while the states that have 8 people to share among them, North and South Dakota, Nebraska, Utah and Iowa, continued being the best performers.

The economy may be out of the recession. Markets have turned around. But the key thing weighing on any American’s mind with a job is his fear of losing it. Now at a 26-year high of 9.8%- household foreclosures rose more than 5% from summer to fall, as federal assistance efforts are overwhelmed by a flood of unemployed.

The unemployment rate in California has hit another record, at 12.2%, while the temporary reprieve in Michigan, which may have been due to a temporary pick up in labor as a result of CfC, is back to losing jobs: after hitting a record 15.2% in June, and dropping to 15% in July, the August unemployment rate is once again at the 15.2% high. Only 17 states reported declining unemployment rates in August, led by Indiana (-6.6%), Colorado (-6.4%) and Virginia (-5.8%). On the other end, the biggest labor losers were: New Mexico: 7.1%, Nevada: 5.6%, Louisiana: 5.4%, District of Columbia: 4.7%, and New York: 4.7%.

"Unemployment insurance benefits have been on an upward trend over the past two
decades, partially reversing an earlier decline. The trend is associated with shifts toward a
higher share of job losers among the unemployed and longer durations of unemployment,
which may cause benefits to lapse for some recipients as labor market weakness persists." - Aisling Cleary, FRBSF

"As an aside, the Bureau of Labor Statistics also publishes a number from the Household survey that is comparable to the nonfarm survey (dubbed the population and payroll-adjusted Household number), and on this basis, employment sank — brace yourself — by over 1 million, which is unprecedented. We shall see if the nattering nabobs of positivity discuss that particularly statistic in their post-payroll assessments; we are not exactly holding our breath." - David Rosenberg

As markets digest the worse, yet somehow better, than expected 9.7% unemployment, the real state of the labor market is much worse, as indicated by the U-6 number, which has hit a recent record of 16.8% on a seasonally adjusted basis. As a reminder, the "U-6 represents total unemployed, plus all marginally attached workers, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all marginally attached workers." In other words, in reality the U.S. labor market is likely about as bad as Spain in terms of undoctored jobless data.

The most recent BLS State unemployment data is out. State by state unemployment increased by 1.0% on average (unweighted) from June to July.

The BLS has released the most recent mass layoff event and initial jobless claim data. The initial claimant data has dropped by about 34k month over month, and is 70.7% higher on a trailing twelve month basis. Comparable data for the initial jobless claims apps.