The bad news is last week’s report was revised up 14,000 to 914,000. It still showed a decline though. Non-seasonally adjusted claims fell 101,000 to 874,000 this past week. PUAs fell 20,000 to 427,000 which is why total unadjusted new benefits fell 9%. That’s the first decline this year. As we mentioned would happen in our article last week, the total number of people on all benefits rose in the week of January 9
th. It was up from 15.99 million to 18.28 million. In the week ending January 16
th, continued claims fell from 4.974 million to 4.771 million. The recovery would be in amazing shape without the pandemic benefits.
The Economy Is at Its Lowest Point Since World War II in Final GDP Report from Trump's Presidency gobankingrates.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from gobankingrates.com Daily Mail and Mail on Sunday newspapers.
We’ve discussed in prior articles how consumers aren’t leveraged. However, when someone loses their job even if they only owe a small amount on their credit cards, it becomes a big problem. Luckily, last year the government came to the rescue with very strong unemployment benefits that paid some people more than their normal job did.
$BAC Bank of America credit card days past due trends pic.twitter.com/ednjtXLuaM
The slide above from Bank of America shows the latest developments. Credit card delinquencies fell from March through July as we had a recovery along with $600 weekly unemployment checks from the federal government. From August to early Q4 delinquencies increased maybe because the unemployment checks expired. Since then, they have fallen (outside of 90+ day delinquencies). That’s surprising because the economy got much worse in December as there were job losses for the first time in the recovery.
This is the first truly terrible jobless claims report since the slowdown started. There will be even more job losses in January than in December, but investors will probably ignore this as the vaccines are set to stop the virus’ spread in the next few months (14.3 million vaccines have gone out in the US). The main questions are how deep this slowdown gets and when it ends. We could easily see sharp job creation starting as early as March or April.
Specifically, in the week ending January 9th, seasonally adjusted initial claims spiked from 784,000 to 965,000 which was way above estimates for 790,000 and the highest estimate which was 835,000. That’s the biggest jump since March 28
No One Is Worried About Inflation – Investment Watch investmentwatchblog.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from investmentwatchblog.com Daily Mail and Mail on Sunday newspapers.