Jobless Americans Go off the Charts
Jobless claims went astronomic yesterday, surging so high they’ve made the all-time chart a nightmare to read. There are 500% more unemployed Americans than was the case back in 1982, when the previous record of 695,000 was set. 3.2 million are sadly on welfare, more than the Great Depression and the Financial Crisis of ‘08 combined according to yesterday’s economic data, and guess what?
Markets took it as a bullish signal!
As surprising as that may sound, the stock market has been tumbling recently to “price in” this kind of fallout. Stories of layoffs have been everywhere, and the White House has been openly fighting the stats. That’s why these shuddering figures shouldn’t be a reason to sell for investors who have been walking around their deserted neighborhoods.
To understand what’s coming next in markets, we need to predict these jobless digits. The downside reality is that many unemployed Americans either can’t apply for aid because they’re self-employed gig workers, could apply but don’t realize it or won’t bother, or have tried to apply but can’t get through crashed government websites and jammed phone lines.
The positive news is that analysts had expected one and a half million jobless claims. The printed numbers came out only twiceas bad. The White House also agreed on the most significant rescue package in the history of the American economy the other day, saving many businesses, and hopefully, many jobs heading into next quarter.
Today’s session will cast the market’s deciding vote in terms of which factor is strongest heading into next week, and will probably determine what further weekend action federal stimulators take. The only constant right now is the spread of this virus, so keep those shorts at close hand!