Thursday, August 20, 2009

Unemployment Claims Unexpectedly (?) Climb

Another in what's becoming a near regular series on "unexpected" negative numbers on the economy. Unexpected, that is, from economists who are simply trend followers and do not understand the business cycle and how the size of Fed money manipulations matters.

When the Fed goes into a slow money growth mode, as it is now, after a period of increased money growth, such as we had, unemployment increases, as the change in money manipulation causes a shift in sector demand in the economy--causing increased unemployment in the sectors that are experiencing less demand.

The Labor Department reports the number of first-time jobless claims rose to a seasonally adjusted 576,000 last week, from a revised figure of 561,000. Trend following economists expected a drop to 550,000, according to a survey by Thomson Reuters.

The highest insured unemployment rates in the week ending Aug. 1 were in Puerto Rico (7.3 percent), Oregon (6.2), Pennsylvania (6.1), Michigan (5.9), Nevada (5.9), Wisconsin (5.5), California (5.3), Connecticut (5.3), New Jersey (5.3), North Carolina (5.1), and South Carolina (5.1).

The largest increases in initial claims for the week ending Aug. 8 were in Tennessee (+2,525), North Carolina (+2,469), Wisconsin (+2,078), Georgia (+1,753), and Washington (+1,697), while the largest decreases were in California (-5,635), Michigan (-1,490), Ohio (-951), Kentucky (-690), and Delaware (-226).

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