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Economists Surprised Again By Unemployment Claims, Should Not Have Been
Economists Surprised Again By Unemployment Claims, Should Not Have Been
Courtesy of Lee Adler of the Wall Street Examiner
The mainstream media proclaimed an unexpected "beat" of the first time unemployment claims number today. The fake, seasonally fudged number dropped to 358,000 in the week ended February 4. According to Bloomberg, the consensus of economists' expectations was for 370,000. Aside from the fact that whether economists get a forecast right or not seems to be completely random, two facts stand out. First, the number that they are looking at is made up and fictional. Second the trend of the actual weekly number has been unflinchingly within a couple of points of an annual rate of decline of 9-10% for the past 18 months.
As long as that trend is intact, there will be no reason to ever expect the weekly number to mean anything other than steady as she goes at the current rate. In fact, there's really little point to forecasting the number on a weekly basis, because typically a big change one way one week is reversed the following week. What counts is the trend, which is another reason why all the old guys on Wall Street are so fond of repeating, "The trend is your friend."
It's nice that the claims number is a weekly number, and that it is virtually real time with a lag of less than a week, therefore the first sign of a change in the trend of the economy may well come from this series. It is worth watching from that respect.
At this point there's no sign of a change in the trend. There's no sign of deterioration, and certainly no sign of improvement over what's been going on, so the fact that the number was a surprise to economists is neither here nor there. The number was completely consistent with the trend.
The actual number of first time claims last week was 397,810. This is based on the data on actual applications that each of the 50 states feed into the Federal Department of Labor's computers. It's not a survey or an estimate, unlike many government series. It's a real number, which the government reports, but which it also then manipulates into a smooth line for economists to wet their pants over. This number will be revised next week, but the week to week revisions are typically small and usually just a matter of housekeeping.
This week's number is a decline of 24,477 from last week, which is absolutely typical for the first reading in February, and it represents a decline of 9.7% from the same week last year. The 52 week rate of change on this chart shows that this rate of change has been very stable in the 10% range, with occasional outliers that have been quickly reversed.
It seems to me that the big surprise is that any economists were surprised, but then, knowing how great the economics profession is at forecasting, I'm really not surprised. The vast majority of economists are either clueless bozos or paid shills, often both.
The important thing is that until this rate of change moves toward zero on a persistent basis, or to more than a 10% rate of decline, there would be no evidence of a change in the slow expansion of the US economy. Meanwhile, the mainstream media will go on surveying the economists every week, and the numbers will surprise or not surprise every other week, like clockwork.
Initial Unemployment Claims Chart- Click to enlarge
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"It seems to me that the big surprise is that any economists were surprised, but then, knowing how great the economics profession is at forecasting, I'm really not surprised"
Only time I will Really be surprised is when they get the numbers correct.
+5... Tyler Worthy Sarcasm
"then manipulates into a smooth line for economists to wet their pants over."
Note to Secretary: Order a case of Depends for Krugman and The Corz's bearded cue-bald brother The Bernank at Xmas...
they are "surprised" to pump the market.
Let me correct your tagline:
"Economists Wrong Again" FULL STOP. There, that fixes it.............and that pretty much covers 2005, 2006, 2007, 2008, etc etc
No Law - No Private Property - no Constitutional Repulic of the USA - It's a sad day but it's time to move on!
Verbewarp February 10, 2012 at 12:08 pm
Well, last night was the event which will have the greatest impact on humanity since the black plague. “ring-a-ring-of-rosies”, appears totally appropriate for a precise analogy between the two phenomenal events. It was reported that the cabal of US Attorney Generals had agreed to a deal that allowed the Banks to blatantly break the Laws of the Land with impunity; past – current - future.
One of the great insights that the US Fathers had was the right to own Property; Private Property in Fee Simple and that right became the core economic driver of the USA – until – the Banks discovered “securitization” in the form of RMBS and all similar and related financial concoctions. When these toxic transactions were questioned at some stage there appeared in the minds of lesser men that not only here there be no value, but the apparatus set up to facilitate the feeding frenzy and lusts of insatiable appetites to make book of the initial assumptions to their profitability, was not only illegal but seriously flawed.
First step was foreclosure before house prices fell to their current ~50% + off purchase price and then step 2 was initiated that required the forgery of deeds of transfer and the whole gambit of Regulations under Law that had been in place since the 17th, Century to protect the very foundations of the then Constitutional Republic of the USA. The Bank innovation is now called “robo-signing” which entails unknown peoples forging the signatures of known peoples onto legal documents required by the Court system (by the individual State Law Systems) and presented to the Courts under Oath. The evidence is ubiquitous and pervasive that these frauds run rampant throughout the USA.
Enter, or so it has been reported, the Federal Government which over-rides the Land Laws of all the States and deems in one sweep, that the Banks did no wrong, and can just keep the scam going while forgetting about established Laws of the Land. And, this is from a President who claims that he is a Constitutional Lawyer?
To the point: The whole US and global banking systems have over the past decade or two (hic) have immersed themselves totally in the property market, and in particular, in the Residential Markets with the result that property prices have been grossly inflated due to the debt availability accelerator. That is, the more debt available (easy credit, no deposit, interest only schema, etc.) the faster the distribution of debt and the greater amount of debt in total - until saturation (an unknown known). Of course, the Banks add these house price debt obligation to their balance sheet in the form of assets.
And, or so, you ask? Well, if the Banks marked down their assets in the form of these houses by say the market rate, and that being less `50%+ or so, then those Banks would all be totally bankrupt. To get around this, the Federal government allowed the Banks to value their assets as they liked or as was convenient. Another set of Laws abolished in the sweep of the Presidential Robo-pen. (Yes, the President of the USA has an auto-Robo-pen that signs for him – perhaps they should have called it the auto-masta-pen?).
Unemployment in the USA according to John Williams is around 22.4%/ 47 million people on food stamps and over half of the US household are receiving some sort of benefit/inflation ~6%. Just who now wants to buy a house apart for the sharp speculators and fleet of foot flippers. The Banks sells you a house; there is no mortgage/ no deed of transfer and the chances of having it repossessed by the same bank or by a different Bank before you even actually move in, are odds on. There is now no guarantee of Title.
The point: The Banks globally are invested almost totally in the property debt markets, in fact, in Australia it is the only real game in town as our tractable “leadership” ("Law-makers" Ha) have ensured by being so directed by the direct influence of the Bankers themselves. IOW Banks’ profits are now collapsing Worldwide; have collapsed Worldwide and are being propped up only by being allowed to mark their assets to fantasy and the transfer of public monies and long term future commitments of the unborn from the unwashed to the Banks.
But, where do the Banks go now, for a Bank is – just as the shark, that must keep moving, the Bank must keep lending, or die? In Australia, credit card use is slowing, the property markets are slowing, inflation is being driven high by the endless tiers of government. Where pray tell me, where indeed will our Banks, (the BIG 4 that is, being owned in majority by JPMC and HSBC) find new business and how will they transform their business from Property to whatever? NAB is already selling two of it UK Banks and all are announcing staff dismissals. They will not transform and they are all but done. Oh, be assured there will be more for the peoples to pay to these thoughtless parasites before all is finished; before they are finished...
Why this post is relevant you ask? Most of those of which I speak of are all members of the Lowe Cult plague!
http://www.australiamatters.com/cms/?p=1485#comments
Today global humanity is under the control of a single celled amoebic collective predator analogous to the cancer producing Funghi Candida. It is better known as a conglomerate known as the Unholy Alliance, which is led and chaired by the iron fist of the oldest of Europe’s Banking families and corporations – served by the eagerly corruptible and greedily obedient politicians – Protected by the smoke and mirrors and propaganda of the Cult of Professional Economists – served faithfully and blindly by the Warrior Priests of that disease known as Bureaucracy – and all with the elite front line Black Guard of the Money Mercenaries – the chosen faithful true-believer psychopaths known as the CEO and CFO’s of the corporate collective masquerading as human beings.
Hope: Breakthroughs in Cellular biology reveals that the environment (and milieu) controls the behaviors of the organism and this brings hope, as a change of environment is what we need and is just what is coming; we call it climate change. It is visually evident in the other planets of the Solar System as well as the Galaxy. Our Electromagnetic field is in flux and will vary somewhat from the past 5000 year Epoch. A regular cyclic occurrence. We need less insanity in our "leadership".
From Leap2020
“One thing is certain for our team: If the Western banks provoke fear today, it is primarily in their own leaders who no longer know how to get out of the death trap in which they themselves are caught, believing that they were able to “manage” all events, with “tractable” (13) politicians and controlled in their service, and crony central banks (14). Yet this time, politicians, even chosen for their docility, are showing reluctance. Even the French President Nicolas Sarkozy is no longer able to defend French banking interests (15) at a European level (16) on a permanent basis.
Under these conditions, there is no longer a way for banks to contemplate a preservation of their profits pared on all sides: increased regulation affecting the most profitable areas, an economic crisis reducing classic business activity, increased competition between institutions and between regions even at the West’s core (17), reduction of their socio-political “weight” because of reduced staff, funding capacity at half-mast, and balance sheets sinking more and more sharply into the “red” (18).” Emphasis mine.
My message is: Keep the faith and don’t let the bastards get you down.
Peace and Reason
once the Euro collapses "that fixes a lot of problems." a productive continent on that scale without money to be...ahem..."played around with"...makes life better for the "not my phuckin problem" set. the Fed has already accomplished this feat here in the USA by making the dollar worthless while convincing you...the debt whore...to keep pushing those interest rates to zero. EXCELLENT! We no longer need money center banks! throw in a war(s) the USA can't possibly win and i think things are looking up for the first time in YEARS! time for the real entertainment now!
well done. figured you for an aussie early on.