Thursday, January 15, 2004
Query
One thing I've always been skeptical of is this overwhelming reliance, in both the mainstream and financial media, on the unemployment Initial Claims report.0 comments
First, this is a report which received precious little attention until millions of people were already out of work.
Then, when it came into vogue a couple of years ago, who was it that decided that 400,000 new claims was the magic median number between bad/good economic numbers? And why did everyone else just agree to follow along?
Whether 400,001 people opened new unemployment claims or 398,457 people did, what gets lost is that close to a half a million people lost their jobs in that time period. As did those in the timeframe before it, and the one before that, etc., etc.
Of course, those with well-paying think tank/government jobs have the luxury to split that hair to almost infinite degrees. And miss the point, entirely.
Another curious point:
Today's Initial Claims report said that 343,000 newly minted unemployed folks opened new claims. The Markets are happy since their consensus number going in was 350,000.
What does it mean exactly when this number starts to drop? Briefing.com reports that this "pointed to a stabilizing employment market."
Does it?
Or does it allude to the possibility that companies have already cut as much as they possibly can and have just started running out of jobs to shed? Are we slowly hitting cutback saturation, where to cut any further has diminishing returns from the continued excessive burnout suffered by the employees that remain?
It seems that the ONLY numbers report which actually matters at this point is the job creation report.
Which doesn't bode well for economic health anytime soon.
posted by Gotham 1:06 PM
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