PRLog - Oct. 24, 2012 - PALM BEACH GARDENS, Fla. -- CNBC reports: [ Weekly applications for U.S. unemployment benefits jumped 46,000 last week to a seasonally adjusted 388,000, the highest in four months. The increase represents a rebound from the previous week's sharp drop. Both swings were largely due to technical factors. The Labor Department says the four-week average of applications, a less volatile measure, fell slightly to 365,500, a level consistent with modest hiring.
No incumbent has ever been re-elected w/ unemployment above 8%, Surprise 7.8% !!
Last week, California reported a large drop in applications, pushing down the overall figure to the lowest since February 2008. This week, it reported a significant increase as it processed applications delayed from the previous week. (Read More: Why Jobless Claims May Not Be as Good as Market Thinks.)
A department spokesman says the seasonally adjusted numbers "are being distorted ... by an issue of timing."
Many economists believe a reading below 400,000 points to an improving labor market. The four-week moving average of new claims, which smoothes out volatility and is considered a better measure of labor market trends, rose just 750 last week to 365,500. "Improvement in the labor market will continue to be fitful and slow," said Joseph Trevisani, a market strategist at Worldwide Markets in Woodcliff Lake, N.J.
Applications are a proxy for layoffs. When they decline, it suggests hiring is improving.
The prior week's figure was revised up to show 3,000 more applications than previously reported to 342,000.
Still, the economy is not growing fast enough to generate much hiring. Growth slowed to a tepid annual rate of 1.3 percent in the April-June quarter, down from 2 percent in the previous quarter. Most economists see growth staying at or below 2 percent in the second half of the year.]
SURPRISE!!! The unemployment applications for this week have jumped again & the magical 7.8% unemployment number that Obama has been touting as proof his economic policies are finally working has been proven to be a fudged number just like Jack Welch suggested. Is it any surprise at this point that the numbers have been manipulated to suggest a rosier picture than actually exists in the economy in order to keep voters happy as they ready to go into the booth to cast their votes for the most contentious election in our lifetimes? Of course it isn’t but it is sad none the less that this is what our elected officials have been reduced to in order to paint themselves in a better light.
As for the magical 7.8%, it is worth mentioning again (it was pointed out in a prior blog post days ago) that historical data blatantly shows that never before in US history has an incumbent president been able to secure re-election if the unemployment number is at or above 8%. So it was a foregone conclusion that this magical number would appear, but waiting to release it as the last employment report within a 30 day window of the election so that the nay sayers would be drowned out by debate coverage & last minute stumping by the politicians was a stroke of political genius if I ever saw it. None the less, the data has been exposed for what it is now, nothing more than an accounting trick to make the prez look a little better just before the votes are cast. You see, the ‘jump’ in employment is nothing more than high skill workers taking part time jobs at the local diner as a busboy to be able to buy groceries as well as conveniently dismissing those unemployed folks who have exhausted their benefits and by default ‘assuming they must have found work since they aren’t collecting a check any longer’! That sounds like a solid job recovery right?
We can fudge the numbers to paint a better picture of the recovery, but are we really helping the nation by lying to ourselves? I’m afraid we are doing more harm than good by applying this creative accounting trick. You see when Investors hear that the best jobs report since the housing crash kicked off just came out they are given the false perception that the economy is gaining steam & this is used to justify throwing their hard earned money into the stock market again. But they never see any real economic activity manifest that would ordinarily go along with more people going back into the work force so their misplaced investing dollars now become a target for Wall Street to extract as profits for themselves. And investors get shafted again when the true (& often conveniently “revised”) employment data comes out in the weeks following & Wall Street bags another suckers hard earned money as another average investor bites the dust.
What is it going to take for the average investor to realize the government & the FED will say & do anything to keep the status quo moving forward? When will the people realize the federal reserve pumped tens of trillion of newly printed inflationary fiat paper dollars into the economy in order to shower their banker buddies with endless free money? When will people realize that we, and or children, and their children etc., will be forced to repay these multi-trillion dollar bailouts to the banks through draconian reductions in our standard of livings by the application of handicapping taxes that won’t be applicable to the super wealthy but instead will be targeted on the middle class? When will people realize the global economy uses fiat paper money that only has value if the people still have faith in it? When will people realize that faith in a piece of paper as a medium of exchange has NEVER worked throughout history because those in charge ALWAYS abuse it beyond repair which ultimately leads to a confidence crisis that results in the collapse of the currency & the irreversible wealth destruction that takes the nation back to square one? When will people realize that inflation can morph into hyperinflation, or that recessions can degrade into depressions, or even that currency wars can turn into trade wars quickly which can then morph into real wars as nations fight to protect their market share of the global economy? When will people realize we have a more serious problem at hand currently than we have ever experienced in the past 3 generations, & possible ever? Maybe its time to establish your “Weak Dollar Insurance Policy” in physical gold & silver bullion now that the global currency war has been publicly admitted & is moving into dangerous territory as China & Japan are firing back with massive waves of money printing in their nations. Remember that it is a far better strategy to PREPARE your portfolio than to attempt to REPAIR it once the damage has begun. Tick, tock.