Initial Claims Surge Far Higher Than Consensus, 1.2 Million Americans Have Dropped Off Extended Benefits Claim In Past Year

Tyler Durden's picture

After taking a quick detour into pseudo-positive economic data, the BLS sends us right back into the depression, with an initial jobless claims number of 417, far higher than consensus of 405K (in fact higher than the highest number in the forecast range), and higher than last week's upwardly revised 412K. Naturally, the BLS is there to provide a justification for the spike, with 8500 jobs apparently "lost" due to the Verizon strike: "Special Factor: As a result of a labor dispute between Communications Workers of America and Verizon Communications, at least 12,500 initial claims were filed in the week ending 8/13/2011 and at least 8,500 initial claims were filed in the week ending 8/20/2011." In other news this is week 20 out of 20 with one or two exceptions of 400K+ prints. And to think that the August NFP number is due in just one week. In other news, continuing claims came below expectations of 3700K at 3641K, a number that will be revised higher as was last week's from 3702K to 3721K. The collapse in extended benefits, as the 99 week cliff claims more and more, means that 20K people fewer collected post Continuing Claims benefits, with those on EUC and extended benefits down from 5.8 million a year ago to 3.6 million: this is 1.2 million Americans that no longer can collect anything from Uncle Sam.

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DefiantSurf's picture

Growth you can believe in!

 

Crumbles's picture

Right, G R O W T H 

in

Food Stamps and Tent Cities.

Depression2 - bring it on !

EscapeKey's picture

Indeed. DJIA futures still green.

"It could have been worse".

MFL8240's picture

Isnt it fun watching the charade on Wall Street?  Gives me a laugh a minute.  Shrotly (after Jackson (A) hole has anounced more confetti) the news will turn positive and the clowns will be out talking aout the "recovery"!lol

Mentaliusanything's picture

With 1,200.000 angry, hungry, disposessed and armed people No country thus opposed could stand.

I Fear Yes, It could have been worse - all they need is a leader ammo and arms then you have a revolution that would make the French one look like playtime with small children. 

HelluvaEngineer's picture

...and futures say "Duuhh?"

Does Wall St know that Labor Day is still over a week away, or did they already head out to the Hamptons with coke and hookers?

HelluvaEngineer's picture

Only a few of the hookers are named Irene.

TruthInSunshine's picture

 

 

 

 

If you said 22%, you are WAY CLOSER to reality than the BLS, and in agreement with a growing chorus of statisticians and economists:

The Jobless Effect: Is the Real Unemployment Rate 16.5%, 22%, or ?

Raghavan Mayur, president at TechnoMetrica Market Intelligence, follows unemployment data closely. So, when his survey for May revealed that 28% of the 1,000-odd households surveyed reported that at least one member was looking for a full-time job, he was flummoxed.

"Our numbers are always very accurate, so I was surprised at the discrepancy with the government's numbers," says Mayur, whose firm owns the TIPP polling unit, a polling partner for Investors' Business Daily and Christian Science Monitor. After all, the headline number shows the U.S. unemployment rate today is 9.5%, with a total of 14.6 million jobless people.

However, Mayur's polls continued to find much worse figures. The June poll turned up 27.8% of households with at least one member who's unemployed and looking for a job, while the latest poll conducted in the second week of July showed 28.6% in that situation. That translates to an unemployment rate of over 22%, says Mayur, who has started questioning the accuracy of the Labor Department's jobless numbers.

A.W.E.S.O.M.-O 4000's picture

That's why I'm long The Soylent Corporation.

 

NASDAQ symbol: PEPL

 

http://www.rachelaaron.net/soylent/soygreen.html

slaughterer's picture

Perfect negative trend to justify QE3.  Falls completely inside Fed dual mandate.    More free money being released from the helicopter tomorrow to save the unemployed. 

ElvisDog's picture

Oh, come on. Are you being sarcastic? There has been enough representation of QE2 as a handout to the bankers in the blogosphere and even MSM, that any attempt to implement QE3 will add fuel to the fire of public resentment against the Fed and bankers in general. At least give Bernanke credit for not being stupid and realizing that fact. I will be very surprised if there is any concrete announcement of QE3 tomorrow. Bernanke may try to jawbone the market with BS about "extended time" and "ready to take additional measures" but that will be all.

tmosley's picture

But, but, but, we were supposed to be entering a new boom :(

HelluvaEngineer's picture

I'm a bit hungover this morning.  Help me out.  This is bullish, right?  Is Apple a buy here?

the mad hatter's picture

the reaction is bullish. all the people expecting further declines are going to get squeezed. Hedge funds made more downside bets in the recent rout than they did during Lehman!

 

http://www.zerohedge.com/news/downside-hedge-fund-bets-sp500-highest-2008

ElvisDog's picture

The medium- to long-term reaction will not be bullish. One of the true-isms (in my opinion) about investing is that cashflow always wins eventually. Companies can do whatever accounting tricks they want to make their earnings seem better, but people out of work, people falling off extended benefits, people taking $10/hour jobs instead of their former $50/hour job, all of that hurts their cashflow which lowers their spending profile. And because the recession/depression is global companies won't be able to count on their foreign operations to pick up the slack.

Ratscam's picture

not apple, NFLX and BAC are a buy these days

DefiantSurf's picture

Tip of the iceberg, next week will be much higher, this week will be revised over 420k

 

bam_son's picture

to be revised to 420

props2009's picture

All the charts on Apple

http://capital3x.com/?cat=4

 

Apple trade is initiated. Time is perfect as Steve jobs steps out!

Gibu The Great's picture

I believe NFP next Friday will be quite messy.

j0nx's picture

Who out there really can get 99 weeks? Out of all the people I know that were unemployed for extended time, ALL of them could only get the initial 6 months and after that they were dropped. 99 weeks is a f'ng myth.

serndipity's picture

The length of time UI applies, varys by state, depending on it's unemployment rate.

Recall that in states, where the unemplyment rate is higher than 8.2%,  folks still get 99 weeks.

carlnpa's picture

You are wrong on both counts!  Why are you spreading the corporate/gov misinformation?

 Not 8.2%, the rate is 9.7%.

http://unemployedworkers.org/sites/unemployedworkers/index.php/site/faq_extended_benefits

serndipity's picture

carlnpa - Man....you are so misinformed.

States that have established a three-month average below 8.0 percent automatically trigger off a portion of the EB program.

http://www.mass.gov/?pageID=elwdpressrelease&L=1&L0=Home&sid=Elwd&b=pres...

carlnpa's picture

It varies by state, for Pennsylvania to provide EB, the state law requires that EB be funded 100% by the federal government. That 100% funding expired at the beginning of June, so Pennsylvania discontinued EB.

If the 100% federal funding is reinstated by the legislation currently being debated in the Senate (HR 4213), Pennsylvania may reinstate payment of EB at that time.

http://www.city-data.com/forum/unemployment/1008983-eb-pa-ended-euc-empl...

http://www.workforcesecurity.doleta.gov/unemploy/euc_trigger/2011/euc_08...

All states are eligible for up to 34 weeks of First and Second Tier benefits.
47 states are eligible for up to 13 weeks of Third Tier benefits as of August 21, 2011.
25 states are eligible for up to 6 weeks of Fourth Tier benefits as of August 21, 2011.
IUR reflects 13-week period ending August 6, 2011.
TUR reflects avg. seasonally adjusted TUR for 3-month period ending July, 2011.

34+13+6= 53 weeks max EB

midtowng's picture

those on EUC and extended benefits down from 5.8 million a year ago to 3.6 million: this is 1.2 million Americans that no longer can collect anything from Uncle Sam.

Tyle also makes a simple math error: 5.8 - 3.6 = 2.2 not 1.2

In a couple months, extended benefits will be in the scrap heap and forgotten. But unemployment will still be above 9%.

John Law Lives's picture

It makes you wonder WHY the BLS felt the need to reference the Verizon worker strike.  I guess they have been given the memo to spin their own data to calm the masses.

100% FUBAR.

 

rubearish10's picture

I'm confused. If they knew the VZ claims were there, why wouldn't the expectations be? 

Id fight Gandhi's picture

The Verizon sound is pure fuckingg bullshit. And when does the bls ever claim a specific company like that?

101 years and counting's picture

in all seriousness, why would people who VOLUNTARILY (union workers on strike) not go to work be able to claim UE insurance?? 

Confused's picture

They can't. You have to file for UE, and get approved, and its delayed by a week or more.

 

Jokes about the approval aside, I believe they actually check with your employer.

JohnG's picture

They do check, and try to find a reason to justify refusal, i.e. "Fired for cause."

Don't know about other states, but bere in Ga., if I fire someone for say, theft, they will be refused.  The former employee will also be arrested and prosecuted when I file a complaint with proof, usually video. I'll send 'em to jail in addition to losing thier job.

Old Poor Richard's picture

Striking workers CANNOT make claims for unemployment benefits, because they're not unemployed yet.  Duh.  That's why some unions have a fund that pays strike pay, so people don't lose their houses, etc.

Astonishing that this suggestion was made.

ON THE OTHER HAND, the strikers were getting pretty violent around here--could be those newly unemployed were collateral damage--non-Verizon people laid off because businesses nearby Verizon offices had to shut their doors due to the bedlam.  Or because their phone and internet were killed due to striker sabotage.  My wife's employer took a huge hit because their phones went down.  They had ONE line to the outside world, the analog fax line, even their interbusiness/intercom was dead.

 

serndipity's picture

Why not try?

In my state (MA), an individual gets $650 / week and a family of 4 would collect $1,200 / week.

Plus either your COBRA payments would be covered or be put on a Blue Cross PPO.

LawsofPhysics's picture

Crap.  Please stop posting information like this.  These numbers are more than what I pay some of my better technicians.  Very demotivating, I may have to block the ZH site now.

alexwest's picture

excuse me i dont get it

#

result of a labor dispute between Communications Workers of America and Verizon Communications, at least 12,500 initial claims were filed

##

 

i heard it was strike, so nobody was fired.. or if they were fired , what fuck is dispute about?

any clues?

 

alx

Gibu The Great's picture

VZ wanted the unions to shoulder more of the health care burden, so they went on strike. 

Surly Bear's picture

They wanted folks on the legacy side of the business to also work on the wireless side. The union did not agree. Private sector unions are fine, if that is what you want, but in this economy, FUCK YOU if you walk off a job.

dwdollar's picture

This hurricane will be one hell of an excuse for fall's data, if it strikes.

Gibu The Great's picture

It will be chugging along the East Coast this weekend.  I am absolutely sure they will milk it as an excuse for upcoming data. 

Sean7k's picture

Operation Twist, playing the bond curve via the reverse repo and voila! 30 trillion in play money. All that's left is to start writing the checks. Now, let's see, JPM to buy BOA or extend benefits? Why not both? Woohoo, "I've got money, I've got good times, I've got my girl, who could ask for anything more...".

serndipity's picture

Since when could one walk off a job and collect unemployment benefits?

Id fight Gandhi's picture

They can't. Does anyone do anything at the bls?

goldfish1's picture

when they change the terms of your employment

Gmpx's picture

Consumer cannot work. Need jobs - drop consumer rights.

carlnpa's picture

99 weeks was a myth for most.

The economy, according to the Feds, has improved so much, in so many states, that extended benefits claims have been suspended as of June 2011.  This was the reason that the unemployment numbers have been manipulated and screwed with, to give a rationale for suspending EB programs.

Most current recipients are now done at 65-70 weeks of benefits. 

You can watch the numbers increase in the food stamp programs.