While Obama Has Us Distracted With Bin Laden, Jobless Claims Reach 8 Month High

[Obama 2012 1,714]

http://www.reuters.com/article/2011/05/05/us-usa-economy-instant-idUSTRE74437V20110505

(Reuters) - New U.S. claims for unemployment aid unexpectedly rose last week to touch their highest level in eight months, pushed up by factors ranging from spring break layoffs to the introduction of an emergency benefits program, a government report showed on Thursday.

KEY POINTS: * Initial claims for state unemployment benefits rose 43,000 to a seasonally adjusted 474,000, the highest since mid-August * Economists polled by Reuters had forecast claims dropping to 410,000. * The prior week's figure was revised up to 431,000 from the previously reported 429,000. * The four-week moving average of unemployment claims, a better measure of underlying trends, increased 22,250 to 431,250, the highest since November.

COMMENTS:

MICHAEL STRAUSS, CHIEF ECONOMIST, COMMONFUND, WILTON, CONNECTICUT:

"You're not supposed to get excited at one-week data on claims, and be leery of claims data around floating holidays.

"We are still dealing with the issue of the floating nature of the Easter holiday. That may be a distortion, and secondly as big and maybe even a bigger issue, a lot of areas of the country had some weather problems in the latter half of April.

"The Labor Department doesn't come out and say we messed up our seasonal factor adjustments, but they did. Their way of putting it is the claims were tied to spring break layoffs in New York. Why did we have that? Because spring break was later because of the floating nature of the Easter holiday.

"Is it going to affect payrolls number? No."

BOB ANDRES, CHIEF INVESTMENT STRATEGIST & ECONOMIST, MERION WEALTH PARTNERS, BERWYN, PENNSYLVANIA:

"I think we're in a situation where the markets and the Fed have been too optimistic. I don't think we're going to fall off a cliff but the road to real recovery and full unemployment is going to take a long time, and people ought to get back into that mode.

"Just to get back to 2007 employment is going to take four years, approximately, and those numbers don't take into account the people who have stopped looking.

"Markets aren't going to like this number this morning but they've had a tendency in the past to ignore bad news."

JOHN KILDUFF, PARTNER, AGAIN CAPITAL LLC, NEW YORK:

"Bearish news is hitting the market from every quarter. Germany started us off with a very poor factory reading, the spike in weekly jobless claims, and an, apparently, less hawkish ECB have combined to accelerate and punctuate the sell-off."

MARC PADO, U.S. MARKET STRATEGIST, CANTOR FITZGERALD & CO. SAN FRANCISCO:

"This weekly claims number, there is a bunch of stuff in there that is kind of screwy in that they are noting a spring break holiday in New York -- I don't know why that has an impact. The change in the benefits program and of course the disaster in Japan having impacted plants that closed down because they couldn't get parts so those people went on jobless claims. So getting a clean number is going to be difficult. We also had a difference in some of the seasonal factors because these are seasonally adjusted and we had a late Easter this time."

"Even if you strip all this out it is still going to be an uptick from the pace we were seeing when we were finally below 400,000. It doesn't look like we stayed below 400,000 so it is going to be a bit of a disappointment."

DAVID ADER, SENIOR GOVERNMENT BOND STRATEGIST, CRT CAPITAL GROUP, STAMFORD, CONNECTICUT:

"Wow. A sharp rise in new jobless claims even with the trio of excuses now puts four weeks over 400,000 and we'd suggest we're running out of excuses. This has provoked a further bid led by five- to 10-year notes.

"The market is clearly discounting a lot of weakness in non-farm payrolls, but it no longer seems just about discounting non-farm payrolls, but a more dire shift."

JAMES O'SULLIVAN, CHIEF ECONOMIST, MF GLOBAL, NEW YORK:

"Frankly it's hard to know what to make of it. Obviously the Labor Department is downplaying the rise due to special factors, but they didn't provide any hard numbers.

"It looks like the bond market is rallying on this report which is logical. Still in the end we really don't know if the recent increase stems partly or entirely from special factors.

"It does feeds into the weakness fears after yesterday's ISM services reports."

DAVID SLOAN, ECONOMIST, IFR ECONOMICS, UNIT OF THOMSON REUTERS:

"The Labor Dep't did identify a number of special factors which inflated the latest weekly figure, making the underlying picture unclear.... Still, 4 straight numbers above 400k, following 4 straight sub-400k outcomes, are enough to raise some doubts over the recovery's momentum... This latest data should be treated with some caution, and the 474k initial claims level is unlikely to be sustained. However, as long as the numbers remain above 400k, this will imply a slower recovery than the Fed would like."

CHRISTOPHER LOW, CHIEF ECONOMIST, FTN FINANCIAL, NEW YORK:

"Jobless claims were up on special factors. It is a shock, but because its special factors there is no way to tell what the underlying damage was. You had auto shutdowns because of the parts shortages out of Japan, and then you've got an all new benefits program in Oregon so it does make sense that initial claims would be up.

"Productivity was a little better than expected, but unit labor costs were also up a little bit more than expected. Productivity growth continues but it has slowed from last year's pace."

MARKET REACTION: STOCKS: U.S. stock index futures extend losses BONDS: U.S. bond prices extend gains FOREX: The dollar adds losses versus the yen

[Trumplestiltskin 5,791]

That's nice Paul, but let's not forget that you're the one that is fixated on Bin Laden.

[I AM NOT THAT GUY 5,715]

Nancy Pelosi, press conference, September 7, 2006:

[E]ven if [Osama bin Laden] is caught tomorrow, it is five years too late. He has done more damage the longer he has been out there. But, in fact, the damage that he has done ... is done. And even to capture him now I don't think makes us any safer.

Nancy Pelosi, May 2, 2011:

The death of Osama bin Laden marks the most significant development in our fight against al-Qaida. ... I salute President Obama, his national security team, Director Panetta, our men and women in the intelligence community and military, and other nations who supported this effort for their leadership in achieving this major accomplishment.

[I AM NOT THAT GUY 5,715]

That's nice Paul, but let's not forget that you're the one that is fixated on Bin Laden.

This thread has been hijacked. It is now another bin Ladin was excommunicated thread.

Edited May 5, 2011 by Some Old Guy

[I AM NOT THAT GUY 5,715]

******************WARNING! GRAPHIC********************************

[Mr. Big Dog 10,747]

******************WARNING! GRAPHIC********************************

This just proves that the Pakistanis are in on the conspiracy.

Edited May 5, 2011 by Mr. Big Dog

[Mr. Big Dog 10,747]

Well, if the Congress would bother to focus on jobs, jobs, jobs as they promised before the election rather than focus on gag, gag, gag then maybe we would actually be able to move forward. But since it's all about gag and not about jobs, this outcome was predictable. Besides, the GOP cannot focus on jobs since they have apparently determined that any new job created lessens their chance to take the White House next year. So we'll gag for awhile longer...