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Thursday, July 24, 2008


Initial claims were surprisingly good. It looks as if the big bulge in NSA's last week was from school closings. Current NSA initial claims are 414,249. The prior two weeks were 484,305 and 401,672. Continuing claims - both NSA and seasonally adjusted - remain somewhat under the 600,000 plus level from last year.

However I doubt this can last, because the global news is turning much more broadly negative. June Japanese exports fell 1.7% on the year:
Exports to the U.S. slid 15.4 percent, a 10th monthly drop and the biggest since November 2003. Shipments to Europe fell 11.2 percent, the second straight decline.
Exports to Asia rose 1.5 percent, the slowest pace in two years. Growth in shipments to China slowed to 5.1 percent from 12.2 percent in May.
As Chinese exports to the west slow the Chinese contribution to Japanese growth will slow.

It's no surprise that exports to Europe are slowing; European manufacturing and services have been contracting for a couple of months. The third quarter is not going to show much if any growth, and it may well be negative. Italian business confidence has fallen to a 7 year low.

In just a bit we get US existing home sales, which are sure to be depressing.

I anecdotally observe a dimunition of season adjustments downward factors. ~414k are adjusted to ~406k. I'll believe it when the third adjustment in October is recorded.
No, that's right. There is a school/university closing bulge, because in some states furloughed summer workers are allowed to claim unemployment and do.

SA adjustments really go week by week.

Initial claims don't get much adjustment, but the SA can be off a week or two during these bulge intervals. For example, school calendars vary a bit year by year.
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