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There are now two dangers.
1. We aren't making any progress back towards the red trend line.
2. We don't know how much of the recent spike higher is due to Hurricane Sandy and how much of it isn't.
Oh no, this isn't supposed to happen. Can you see me? We're flying blind here friend. - Guardian Angel, Borderlands
See Also:
Extreme Initial Claims Danger v.22
Source Data:
St. Louis Fed: Initial Claims
DOL: Initial Claims
11 comments:
From the "Hurricane Sandy" link...
Sal Guatieri, an economist at BMO Capital Markets, said that a similar jump in applications occurred after Hurricane Katrina in 2005.
"We should see a full retracement of this increase in coming weeks," he said. Applications were declining before the storm, he added, "though levels are consistent with moderate, rather than strong, job growth."
I'm not convinced that we would have seen a full retracement even if the hurricane hadn't hit. Sigh.
Eyeballing it, it looks like it took about 3 months for the Katrina spike to retrace. If Katrina was worse, maybe it only takes one or two months to retrace back to original path, which was flat to up.
There are lot of potential shocks that could drop the US into recession from here, if we are not heading into one already as part of the normal business cycle.
In fact, it is hard to imagine that one of the shocks will not hit in 2013. Europe in recession, debt ceiling, fiscal cliff, postal service BK, Obamacare impact, Middle East war in Syria and/or Iran, another US credit downgrade. These are just off the cuff potential shocks. What if really something unexpected happens?
If there's a "new normal" then that blue line's probably it.
I'm not that optimistic.
"Applications were declining before the storm, he added"
No they weren't
http://www.johnlohman.com/WTF22/imag007.jpg
Mr Slippery,
What if really something unexpected happens?
In that event, I'll have to shut my blog down because real prosperity will have been fully restored.
What could be more unexpected than that? Hahaha!
Oh, wait. Perhaps you meant that something really unexpectedly bad could happen? I'm trying to think what that could be. I'm bracing for that already, lol.
Gallows humor. Sigh.
TJandTheBear,
At some point I at least partially expect that blue line to start turning up and then start feeding on itself.
I see your non-optimism and raise you, lol. Sigh.
Fatboy,
They broke the upward revision streak last week. There was no upward revision last week (for the prior week). 70 times in a row is the new record to beat.
That said, we're already starting a new streak. Note that last week's initial claims were revised higher by 6,000. It was originally reported at 355,000. Now we're told it was 361,000.
Somebody needs to try electroshock therapy on the hamster powering their prediction model. Just a thought!
And lastly, the blue line doesn't exactly imply that the applications were falling before the storm. There's a reason I've been tracking initial claims for 22 straight weeks and it wasn't because I was so excited about the continuing decline in initial claims. That's for darned sure.
4Q07 was 5 years ago already. Man.
At least I can say that I think I've learned a helluva lot in that time.
Not what I needed to learn per se, but what I wanted to.
Troy,
That means it has been 5 years since we entered a recession. It sure is comforting to know that although we've had 19 of them in the last 100 years, Ben Bernanke has permanently put a stop to them!
I'm once again reminded of the following question.
Is it ever really possible to have too much sarcasm?
http://www.zerohedge.com/news/2012-11-16/twinkies-ding-dongs-maker-hostess-liquidates-following-failure-resolve-labor-union-a
should provide a significant spike in claims for this week
Scott,
Yeah, I heard it on the radio today. It's like twinkie deja vu prosperity all over again.
January 10, 2012
Twinkie Prosperity Deja Vu
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