Wednesday, March 5, 2014

West Coast Initial Claims

The following chart shows the 52 week moving average of initial claims in California, Oregon, and Washington.

Click to enlarge.

Good luck convincing me that:

1. October's weather explains the trend failure on the west coast.
2. The business cycle is dead.
3. I should embrace risk assets right now.

See Also:
The Business Cycle Is Not Dead

Source Data:
St. Louis Fed: Custom Chart


Troy said...

california claims / covered employment:

adding covered employment in red (right axis)

no negative trend there yet


Troy said...

man that red graph reminded me why I moved to Tokyo in 1992!

I interviewed at MSFT in Apr and kinda bombed out, then Atari Games in May. REALLY wanted that job, but it was not to be. Probably for the best, their best days were well behind them, and their 1990s stuff was craaap.

Stagflationary Mark said...


Your link is broken for me. Here's a fix.

no negative trend there yet

Your blue line bottomed in September of 2013 and has been sitting at late 2011 and early 2012 levels ever since. That's a bad thing.

Your red line doesn't tell us much since it doesn't tend to fall until recessions are over.

As seen here (national data), covered employment is an extremely lagging indicator compared to nonfarm payrolls and initial claims.

Here's a look at what west coast nonfarm payrolls have been doing. Growth has been slowing. At what point growth slows even further is open for debate (it will slow eventually though unless the west coast labor force can expand by the same rate over the long-term, which I very much doubt it can).

The data does not include anything from 2014 yet. Seeing as it is already March, we're therefore flying a bit blind.

P.S. I'm really sorry to hear you didn't get the job you wanted. :(

CP said...


Good evidence. Something happened in Q3 that had nothing to do with weather.


Stagflationary Mark said...



The west coast bounced back a bit in today's report (all three states). That said, something is clearly amiss with weather theories explaining all the weakness.