Last week, I wrote about how weekly new claims for unemployment had finally fallen below 400,000 after holding above that level for 17 weeks in a row. Today, the government revised last week's number to 401,000 and issued the number for this week of 400,000. Despite the continuation of the over 400,000 string, this is good news. For quite some time, the figure was staying at about an average of 425,000. Two weeks in a row at 400,000 means that there has been at least a marginal improvement. Let's be clear: 400,000 new claims is very poor. If the number stays here, the unemployment rate will increase over time. Still, it is worth noting that at least there is a ray of hope in the results.
On the other hand, if we are truly entering a double dip recession, then things will get much worse and soon. Former Obama adviser Larry Summers said yesterday that there was a one third chance in his view that there would be a double dip. To me, he is an incurable optimist. I think it is more like 50-50.
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