The government propaganda minions in the financial media have done it again this week, claiming that the flattening trend of new unemployment claims is a sign that the economy is improving. Are they too stupid or too clever to report the real reason that claims are coming down? That is that if millions fewer people are working, then fewer people can claim unemployment compensation. Maybe the real question should be whether the trend of claims as a percentage of those eligible is improving. The answer is that it is not.
Over and over again the mouthpieces of the mob make these claims that the economy is slowly improving. An examination of the raw data shows that, at best, they are playing semantic games. It may or may not be getting worse more slowly than it was before, and most data series are clearly not as bad as they were at the zenith of the financial crisis a year ago. But economic collapses, i.e. Depressions, like economic expansions, take countertrend breathers every now and then. This is one of those “now and thens” and it may be coming to an end.
First, let’s strip out the “seasonally adjusted” crap that distorts and poisons the mainstream reports on this. The only reason for it is obfuscation, even in weeks when it would have served their propaganda purposes to report the actual numbers.
Last week initial claims actually fell by 53,000 from the previous week. That’s a big number, but state offices were closed for Veterans Day. The total number of new claims was 479,295 (actual real number, not seasonally adjusted hocus pocus mumbo jumbo). That averages out to 119,823 per day. The week before, claims totaled 532,427, or 106,485 per day in a normal 5 day week. So more people applied each day the offices were open in the most recent week, than in the prior week. No improvement there. In fact, on a daily basis this week was 12% worse than last week.
So much for the decline in claims. As far as the seasonally adjusted numbers showing no change, I guess they just made that up. The government can do that– just make stuff up. It’s called lying, and politicians and government bureaucrats are masters at it. In spite of that, I have to start somewhere in my analysis. The raw, unadjusted data that no one looks at appears to be logically consistent, so I will assume that it isn’t overly manipulated.
Let’s move on to the ugly graphics and what I think are the most important numbers. Those are:
- actual continuing claims,
- the actual total number of persons eligible and covered under the program,
- and finally, the percentage of those eligible filing new claims each week.
That should give us a truer picture of whether things are actually improving or not. What you will see is that what is coming out of the Wall Street controlled, mainstream media government propaganda ministries, and the captive economic establishment, is a bunch of asinine, inane, misleading claptrap.
This chart shows the number of new claims on the left scale and the insured unemployment rate on the right. Both have had the usual seasonal decline, except that the declines were larger than is typical because of the magnitude of the rise that preceded the drop. New claims returned to the uptrend line at the seasonal low. This line represents the ongoing economic contraction. The trend continues to rise, suggesting that the economy is still contracting.
For 3 years prior to 2007 the trend was flat with the typical September-October low around 240-250k. In September 2008, the low was 337k. In September 2009, it was 411k. That’s not improvement.
On November 14, the number was 479k. At the same point last year the number was 513k. That looks like improvement. But is it? Not when you consider that the number of those working and covered by unemployment insurance is down by 7 million since the same date last year. This explains not only the drop in continuing claims, but the nominal drop in new claims that gives mainstream economists and media pundits the justification for claiming improvement. Not only is it not improvement, it represents both an economic catastrophe, and a human catastrophe.
Over the 4 week period ending November 15 last year 0.367% of those eligible, filed claims. This year over the same period the number was 0.381% (see red elipses on chart). That’s not improvement. It’s virtually the same rate of deterioration that was registered last year when the economy was in the grips of full blown crisis.
The next chart says it all. It’s the ratio of civilian employment to the total non-institutional population of the US. As of October, the rate was still crashing, and at 58.5% had reached the lowest level in 26 years. Technicians will recognize in this chart not only a cyclical reversal but a secular trend reversal. In view of this, it’s hard to understand how any honest observer could claim with a straight face that the economy is improving.
And please don’t give me that “jobless recovery” oxymoron. Wall Street can take that claim and shove it.