December 19, 2013

AP: Reducing Fed’s Annual ‘Stimulus’ From $1.02 Trillion to $900 Bil Is ‘Strongest Signal of Confidence’

As would be expected, Associated Press reporter Martin Crutsinger Wednesday treated Federal Reserve Chairman Ben Bernanke’s announcement that the nation’s central bank will reduce the amount of money it creates out of thin air from $1.02 trillion per year to $900 billion, i.e., from $85 a month to $75 billion, as “its strongest signal of confidence in the U.S. economy since the Great Recession.” As will be shown, it’s a sign of continued serious weakness.

The pretense inherent in all of this is comparable to teaching a child how to ride a bike, raising the training wheels by one-eighth of an inch, and pronouncing him or her ready to roll. What should be troubling is that the tiny reduction means that the Fed will be financing a much higher percentage of next year’s projected deficit and increase in the national debt than it has in previous years. That would seem to indicate that the nation is running out of other buyers who might be interested in purchasing Treasury securities, and that Bernanke’s own words in July, namely that “the economy would tank” if he wasn’t so obviously and artificially propping it up, are truer than ever.

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Positivity: Apple’s Christmas Ad

Filed under: Marvels,Positivity — Tom @ 9:32 pm

Nicely done (HT Daryn Kagan):

WaPo Poll Report Headline: ‘Obama Suffers Most From Year of Turmoil’

Poor guy.

Barack Obama gets to jet around on Air Force One, golfs every once in a while (/sarc), and has all the trappings and perks of the highest office in the land. But according to a headline in Monday’s Washington Post, he is the one person in the whole USA above everyone else — not those who have lost health insurance plans with which they were happy, not those who are paying outrageious amounts for far skimpier coverage than they formerly had, not the millions of potential workers so discouraged that they are no longer looking for work or considered to be workers, not the increasing ranks of the homeless — who has taken it on the chin this year (bolds are mine throughout this post):

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Bloomberg, AP Mimic DOL Meme on Ugly Unemployment Claims Report: ‘Holiday Distortions’

Bringing on yet another appearance of the dreaded “U-word” — “unexpectedly” (via Bloomberg) — the Labor Department reported today that initial claims for unemployment benefits rose to a seasonally adjusted 379,000. That’s a nine-month high, and an increase from last week’s also unexpected 369,000. This week’s and last week’s results were far above the 332,000 and 320,000, respectively, analysts had predicted.

The Department of Labor’s excuse for the past two dismal weeks has been “holiday volatility.” Though they mostly had a point last week, this week they don’t. Last week was the week after Thanksgiving, while that holiday took place six days earlier in 2012. But the week ended December 14, 2013 and the comparable week from last year (12/15/12) are both sufficiently removed from Thanksgiving’s influence on the numbers that the holiday has no meaningful impact. The business press is pretending that DOL is right.

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Initial Unemployment Claims (121913): 379K SA; Raw Claims UP 3.1% Over Comparable Week Last Year

Filed under: Economy,Taxes & Government — Tom @ 8:31 am

Business Insider’s prediction is 332,000 seasonally adjusted claims.

I’ll look at details after excerpting the report.

Here it is — a very big “oops.” Make that a very big “uh-oh”:

SEASONALLY ADJUSTED DATA

In the week ending December 14, the advance figure for seasonally adjusted initial claims was 379,000, an increase of 10,000 from the previous week’s figure of 369,000. The 4-week moving average was 343,500, an increase of 13,250 from the previous week’s revised average of 330,250.

… UNADJUSTED DATA

The advance number of actual initial claims under state programs, unadjusted, totaled 414,002 in the week ending December 14, a decrease of 48,196 from the previous week. There were 401,429 initial claims in the comparable week in 2012.

I believe this is one of the first times, if not the first time, in several years that there has been a year-over-year increase in raw claims in a week not affected by storms or the timing of holidays.

Obamacare anyone???? Specifically, the No-Growth Obamacare Christmas yours truly feared may be coming to pass.

The seasonal adjustment factors are pretty comparable (109.6 for the week of 12/15/12 vs. 109.1 for 12/14/13).

Last week was partially (but only partially) explained away because it was the week after Thanksgiving, meaning that they was carryover from the two-day holiday. That excuse isn’t available this week. If anything, you could argue that the compressed Christmas shopping season should have made retailers and those who supply them reluctant to let people go — if business conditions were good. But they’re apparently not.

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UPDATE: Zero Hedge says that “BLS Blames Holiday Volatility.” That’s BS from BLS.

Dem Dream Relayed by AP: Jim Matheson’s Retirement in Utah Leaves Him Better Positioned For 2016 Senate or Gov Race

So here’s the “logic” Michelle Price at the Associated Press relayed from Democratic circles in Utah in her Tuesday report on eight-term Democratic Congressman Jim Matheson’s decision to leave Congress: He would have had a tough time defeating Mia Love in next year’s congressional race rematch, but he’s now in a better position to take on an incumbent Republican in a 2016 statewide race — either U.S. Senator Mike Lee or Governor Gary Herbert.

Price either chose not to find or couldn’t find a Republican to comment on Matheson’s statewide prospects, nor could she locate anyone close to Matheson to comment on whether or not the congressman even has any statewide ambitions. Thus, she spent several paragraphs on mere speculation. Excerpts follow the jump (bolds are mine):

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Thursday Off-Topic (Moderated) Open Thread (121913)

Filed under: Lucid Links — Tom @ 6:05 am

This open thread will stay at or near the top today. Rules are here. Possible comment fodder may follow. Other topics are also fair game.