Market Unhappy With Initial Claims Miss As 1.3 Million People Fall Off Extended Benefits In Past Year
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FROM ZERO HEDGE
One month of positive economic surprises since the last FOMC may be all we get, now that a "majority" of FOMC members suddenly need a rapid deterioration in economic data to usher in the NEWER, MORE OPEN-ENDED QE. Initial claims was happy to comply: after posting several weeks in a row of "beats", claims has finally resumed "missing", as well as rising, posting an increase from last week's upward revised 368K print to 372K this week, worse than the expected improvement to 365K, and to a one month high.
And with continuing claims missing too, the real story continues to be the steep fall off in those on extended benefits and EUC, which declined by a total of 48K in the past week, and down by about half a million in the last few months, and lower by 1.3 million in the past year.
This is 1.3 million fewer consumers who can recycle Uncle Sam's dole back into the economy and iGadgets.
The question is whether this minimal miss is enough to justify the FOMC (Fed Open Market Committee) doves' fears the much more QE is needed. Judging by the futures reaction to Bullard and claims, the answer is so far no, and in fact points to something very ominous: the closer the Fed (and ECB) come to actually doing something instead of talking about it, the more negative the market reaction seems to be.
Woe to Bernanke or Draghi the second they finally have to do something instead of telling listeners to "believe them."
One month of positive economic surprises since the last FOMC may be all we get, now that a "majority" of FOMC members suddenly need a rapid deterioration in economic data to usher in the NEWER, MORE OPEN-ENDED QE. Initial claims was happy to comply: after posting several weeks in a row of "beats", claims has finally resumed "missing", as well as rising, posting an increase from last week's upward revised 368K print to 372K this week, worse than the expected improvement to 365K, and to a one month high.
And with continuing claims missing too, the real story continues to be the steep fall off in those on extended benefits and EUC, which declined by a total of 48K in the past week, and down by about half a million in the last few months, and lower by 1.3 million in the past year.
This is 1.3 million fewer consumers who can recycle Uncle Sam's dole back into the economy and iGadgets.
The question is whether this minimal miss is enough to justify the FOMC (Fed Open Market Committee) doves' fears the much more QE is needed. Judging by the futures reaction to Bullard and claims, the answer is so far no, and in fact points to something very ominous: the closer the Fed (and ECB) come to actually doing something instead of talking about it, the more negative the market reaction seems to be.
Woe to Bernanke or Draghi the second they finally have to do something instead of telling listeners to "believe them."
Claims:
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The ongoing collapse in former workers collecting Emergency Unemployment Compensation:
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And Market response:
Huge Miss In Initial Claims Follows Last Week's Seasonally-Driven Beat - JULY 14th
So much for last week's shocking beat in Initial Claims, which as a reminder printed at 350K on expectations of 372K, driven by the July 4 holiday and, what we described were "onetime factors such as fewer auto-sector layoffs than normal likely caused the sharp decline." This week the initial claims soared right back to 386K on expectations of a 365K print: so last week's 22K beat was promptly reversed following this week's number- a miss 21K above expectations. And of course, last week's 350K was upward revised to352K. Of note is what we said last week: "the Not Seasonally Adjusted claims number rising by 70K is very much irrelevant." Sure enough, this week the unadjusted number rose even more, by 10.8K to 453K, just 13K below last year's number of 470K. This compares to the 32K difference from a year ago for the seasonally adjusted numbers. That this stinks to high seasonally adjusted heaven needs no observation. Finally, people for whom extended claims expired soared by 84K in one week, as those on EUC 2008 benefit is imploding with each week. Overall, a very ugly number, but not horrible enough yet to send the S&P up 100 on imminent NEW QE.
Americans Joining Disability Now Outpacing Americans Finding Jobs
Don't believe The LameStream Media People, Here's The Truth
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A new chart set to be released by the Republican side of the Senate Budget Committee details an alarming fact: In the last three months, more Americans have joined disability than have found a job:
As the chart shows, between April-June 2012, an estimated 246,000 Americans were added to Social Security's disability insurance program. In that same time period, only 225,000 American jobs were created.
These alarming numbers, though, are part of a wider trend, as another chart, also set to be released later today, from the Republican side of the Senate Budget Committee shows: |
Click to read the article
Click to read the article
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As this chart shows, since 2008, 3.6. million Americans have been added to Social Security's disability insurance program. In that same time period, a net total of 1.3 million jobs were lost.
"Amazingly, while fewer Americans are working than at the end of 2008, 3.6 million Americans have been awarded SSDI benefits over the same period. The growing number of people on disability and other federal benefits, combined with weak economic growth, raises serious concerns about the sustainability of the American economy," Senator Jeff Sessions, ranking member of the Senate Budget Committee, says in a statement in response to these new numbers.
"Amazingly, while fewer Americans are working than at the end of 2008, 3.6 million Americans have been awarded SSDI benefits over the same period. The growing number of people on disability and other federal benefits, combined with weak economic growth, raises serious concerns about the sustainability of the American economy," Senator Jeff Sessions, ranking member of the Senate Budget Committee, says in a statement in response to these new numbers.
