DOL released initial claims today at 383K SA. Last week's initial claims was 370K, revised up to 373K.
You can have expansion at these levels, but it means that significant economic adjustments are taking place. See, for example, the 84-85 period
Yesterday there was a whole bunch of housing blather about pendings, etc. True, the Month over Month dropped more than 5% SA, but it doesn't mean anything. FHA increased premiums in April, which brought sales forward a month or two. So pending home sales for April (sales in May/June mostly) are of course going to be suppressed. You'll get a true read on pace from averaging existing home sales for April, May and June. Not before then. FHA still "owns" a huge portion of the market for anyone who doesn't have a large downpayment, so they control the deal.
It's important to understand the FHA mov before blithering about these housing indicators. For once, NYT did a good job with it
. FHA shifted cost burdens from better-qualified buyers to crappy would-be refiers, and of course it is going to shut down sales a bit. In many areas the major bar for purchasers is the downpayment, given extremely low mortgage rates which make the cost of buying less than renting for many would-be buyers.
The US economy seems to be in a relatively sweet spot (skipping recession) but of course that is overshadowed by the tremendous international can of whoop-ass slowly cranking open. India's in real trouble, China is in real trouble, Europe - it's the revenge of the nerds. The popular-kids crowd that runs Europe just never had to deal with this type of adversity before, and they are ludicrously inadequate.
I will be blogging more. Part of the problem is that words utterly fail to express the dark hilarity of Europe. China has an old-fashioned bubble going on, but they are trying to stamp down. The leadership is at least working on it.
India has the same old, same old. The legacy of state-controlled interests which attempt to block outside investment, a gruesome fiscal gap that means they have to attract a ton of on-going foreign investment to make ends meet, the ridiculous energy subsidies, the cost of which is mostly hidden in oil bonds, and so on.
Needless to say the commodity bust will continue. It appears this morning that Draghi got Monti to threaten Merkel on Eurobonds. The interim plan for the ECB is to put money directly in banks, but they can't keep going on that for long.