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US New Jobless claims 264k - a 14-year low; Anecdotal evidence of labour shortage in some industries
Topic Started: 17 Oct 2014, 10:57 AM (564 Views)
miw
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And in the same day we have some Fed hawks saying that they should delay the end of QE because inflation is too low. One things is for sure - the slack in the labour market is disappearing at a reasonable clip.

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U.S. Jobless Claims Fall to 14-Year Low
Report Marks Fifth Consecutive Week Below 300,000

By Jonathan House
Updated Oct. 16, 2014 10:05 a.m. ET

WASHINGTON—The number of new claims for jobless benefits fell to a 14-year low last week, the latest sign of an improving labor market.

Initial claims for unemployment benefits fell by 23,000 to a seasonally adjusted 264,000 in the week ended Oct. 11, the Labor Department said Thursday.

That was below the 290,000 claims forecast by economists surveyed by The Wall Street Journal and the lowest level since the week of April 15, 2000, when it was 259,000. The Labor Department said there were no special factors affecting the data.

“This is a clear signal of real strength in the labor market,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics.

WSJ's Chris Dieterich and Simon Constable take a look at initial jobless claims as well as global and domestic markets. Plus, a look three stocks to keep an eye on. Photo: Getty

The report also showed the four-week moving average for initial claims, which smooths out week-to-week volatility, fell 4,250 to 283,500.

The number of people filing continuing claims for unemployment benefits rose 7,000 to 2.4 million for the week ended Oct. 4. Those figures are reported with a one-week lag.

The data marked the fifth consecutive week initial claims have been below 300,000, the longest such stretch since 2006. As the economic recovery gains traction, employers are increasingly reluctant to lay off workers. They are also becoming increasingly willing to hire new ones.

Jim O’Sullivan, chief U.S. economist at High Frequency Economics, said the continued decline in claims points to “a sustained pickup in payrolls gains this year.”

Payrolls have expanded by an average of 227,000 a month this year, putting 2014 on track to be the strongest year of job growth since the late 1990s.

At 5.9%, the nation’s unemployment rate remains high by historical standards, and many of those who do have jobs are stuck in part-time employment. Citing these and other signs of an abundance of idled labor in the economy, Federal Reserve officials have pledged to keep interest rates at their current level near zero for a “considerable time.”

But anecdotal evidence is mounting that labor shortages are developing in some industries. The Fed’s latest “beige book” survey of regional economic conditions found that “some employers had difficulty finding qualified workers for certain positions” in most parts of the country.

The report released Wednesday said that manufacturers in the Boston area, for example, were having trouble finding machinists, while construction projects in Chicago were being delayed by skilled-labor shortages.
Edited by miw, 17 Oct 2014, 10:58 AM.
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peter fraser
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The USA does seem to be performing, the only concern is that house sales are not that strong, which may mean that something isn't quite right given the still low prices in many areas and low rates.

Edited by peter fraser, 17 Oct 2014, 12:10 PM.
Any expressed market opinion is my own and is not to be taken as financial advice
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Mike
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Wages have begun to increase although only by a small amount but still rising. I expect that trend to increase which will further fuel growth as the middle class increase's it's income.

Rates will rise soon, the fundamentals are just to strong to keep rates this low. If the Fed does not move soon it risks letting the inflation genie out which will appear quickly once spare capacity in the economy and employment markets dries up which is rapidly approaching.
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newjez
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Mike
17 Oct 2014, 01:49 PM
Wages have begun to increase although only by a small amount but still rising. I expect that trend to increase which will further fuel growth as the middle class increase's it's income.

Rates will rise soon, the fundamentals are just to strong to keep rates this low. If the Fed does not move soon it risks letting the inflation genie out which will appear quickly once spare capacity in the economy and employment markets dries up which is rapidly approaching.
It should happen. No one seems to know why it isn't happening.
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Yes Peter, that's because it is an illusion ,smoke and mirrors bullshit by the vested interests to a paint a rosy picture, when Infact the opposite is true.

They sure have you fooled Mike.

This is how is goes below, same story as six months ago.

They dont mention the 800,000 that have dropped out of the workforce(kicked off the dole).


http://www.infowars.com/its-an-illusion-here-are-the-real-unemployment-numbers/
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bundy
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The USA can't afford to raise rates.
They can't even afford to end QE.
The USA economy is well and truly rooted.
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bundy
17 Oct 2014, 04:34 PM
The USA can't afford to raise rates.
They can't even afford to end QE.
The USA economy is well and truly rooted.
Pretty much sums it up in three short comments Bundy.

That's what many fail to understand , that they cannot raise rates and any talk of it is absolute bullshit, and the fed knows this better than anybody.

The US is now caught between a rock and a hard place, they have pumped so much stimulus into the bond and stock market while jamming interest rates at zero for the last six years that the stock market has become so over Inflated that they are forced to pullback or risk a major crash.Meanwhile the real economy is still headed downhill. So now they have to reduce stimulus ,but without it, the stock market will just head backwards.

So I would say its only a matter of time before the stock market drops below the trend line with out the stimulus. But the fed would know this, so I don't know if they have anything else planned. If not, they will be forced to admit they were wrong, that interest rates will not be going up and that more stimulus goes in. The stock market won't work without it,and the real economy won't work with or without it.
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Ned Flanders
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bundy
17 Oct 2014, 04:34 PM
The USA can't afford to raise rates.
Correct.
Quote:
 
They can't even afford to end QE.

Incorrect. Unless the Fed starts buying stocks, QE will end. Unless the US Gov expands deficit spending, QE will end.
Quote:
 
The USA economy is well and truly rooted.

Incorrect. Parts of the USA economy are well and truly rooted, and have been for going on 20 years now. Other parts of the USA economy are experiencing double digit growth. This is what the bankers and the economists don't understand. This is a structural change, not a cyclical change.
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