2008-04-03 Initial Jobless Claims

Initial Jobless Claims (Mar 29)

Survey 366K
Actual 407K
Prior 366K
Revised 369K

2008-04-03 Continuing Claims

Continuing Claims (Mar 22)

Survey 2860K
Actual 2937K
Prior 2845K
Revised 2840K

This is now more in line with what’s looked like near zero growth for the first quarter, and not much more is expected for Q2.

While fear of systemic risk has been reduced with the realization that the Fed/Tsy can -and probably will- simply ‘write checks’ as needed, that doesn’t guarantee general weakness won’t continue.

As Karim has been indicating, we may be near the end of rate cuts, but continued weakness could mean rates stay down for a ‘considerable period.’

Also note markets aren’t (yet) moving much on this.

With reduced systemic risk fears, these types of numbers are more ‘rear view mirror’ events than forward looking regarding the future of GDP growth.

In other words, data can be forward looking for some purposes, like systemic risk, and rear view mirror for other purposes, like GDP growth.

Also, Bernanke pointed to differences between now and the 1930’s, leaving out the largest factor – the gold standard. With a fixed exchange rate policy the govt can’t ‘simply write checks’ as that tends to result in outflows of gold/spikes in interest rates that can quickly lead to default/devaluation.

(The US shut down in the payments system in 1934 and reopened with a domestically suspended gold standard and federal deposit insurance.)

From Karim:


2008-04-03 ISM Non-Manf. Composite

ISM Non-Manf. Composite (Mar)

Survey 48.5
Actual 49.6
Prior 49.3
Revised n/a


Nice bounce off the bottom though longer term still drifting lower.


2008-04-03 ISM TABLE

2008-04-03 ISM TABLE

ISM TABLE (Mar)

From Karim:

Consolidating at contraction levels; employment unch at 46.9;

Yes, bodes for flat Q1 and probably a slow start to Q2.

inventory
sentiment remains poor (inventories too high)

Yes, meaning they are running relatively lean for a recession.

Also, new orders up some export orders up very sharply to 55, indicating continuing weakness for domestic demand but exports picking up the slack and then some.

Prices paid up and too high as well.

Weakness and higher prices continues.

(Crude now up on the day.)

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