The number of Americans filing new claims for unemployment aid showed a rise this morning of 17,000. That puts it at 361,000, and note, they were off 1,000 on last week’s claim number if you want to be charitable. In reality they upped it during the week as has been their deceptive practice for the past four years.
They have finally gotten off the “It’s Hurricane Sandy’s fault” line as that crutch has become a little wobbly.
This data as ZeroHedge writes, “remains below the year’s average, though not by much, and the trend of claims falling appears to have almost entirely stalled this year from the hope-driven moves of the previous two years.”
As for the final reading of the GDP for the third quarter, it rose from 2.7% to 3.1%. That makes it the first 3.% plus print since last year’s fourth quarter reading. Sounds good, doesn’t it? Not to ZeroHedge who sees that
reading between the lines reveals more of the same disappointing components, with nearly half of the entire 3.1% annualized growth being derived from Government (0.75) and Inventories (0.73%), combined adding 1.48% (more than in the second revision) of the 3.1% print. Annualized Personal Consumption as a portion of the final number rose modestly from 0.99% to 1.12%, but still is well below the 1.42% in the first Q3 GDP estimate. It is this number that will be closely watched once the preliminary Q4 GDP number is released in a one month. Recall that Q4 GDP is currently tracking between 0.5% and 1.5% depending who you ask. Finally, the most important real growth factor for the US economy – fixed investment – remained stubbornly flat, at a mere 0.12%, virtually unchanged from the first revision’s 0.10%. In other words, in Q3 companies stubbornly refused to invest in capital investment i.e. CapEx, and will continue to do so as long as the Fed makes “investing” in dividends and buybacks a more rewarding option. Expect the same pattern to continue in Q4 only this time the Sandy and Fiscal Cliff excuses will be espoused by all the economic apologists.
Those who just read headlines will break out the Happy Days Are Here Again theme song while the rest of us will gird for more economic woes.