USA Weekly Unemployment Claims at 5-Week High

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U.S. Department of Labor: Unemployment Insurance Weekly Claims Report

In the week ending May 26, the advance figure for seasonally adjusted initial claims was 383,000, an increase of 10,000 from the previous week's revised figure of 373,000. The 4-week moving average was 374,500, an increase of 3,750 from the previous week's revised average of 370,750.

The advance seasonally adjusted insured unemployment rate was 2.6 percent for the week ending May 19, unchanged from the prior week's unrevised rate.

The advance number for seasonally adjusted insured unemployment during the week ending May 19 was 3,242,000, a decrease of 36,000 from the preceding week's revised level of 3,278,000. The 4-week moving average was 3,263,750, a decrease of 12,000 from the preceding week's revised average of 3,275,750.

Weekly Unemployment Insurance Claims by Month

Weekly Unemployment Insurance Claims by Year

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USA Employment Trends Index Increases, Signals Moderate Improvement

The Conference Board: Employment Trends Index

The April 2012 Employment Trends Index increased +0.86 to 108.04 (preliminary) and a post-recession high.  This is the 9th increase in the past 10 months. The ETI has continued above the 100.00 benchmark for 15 consecutive months, after 27 consecutive months below (November 2008 through January 2011). The ETI continues at historically low levels, but has attained the early 2003 lows. Gad Levanon, Director of Macroeconomic Research at The Conference Board noted, "the disappointing job gain in April (115,000) is probably below the current trend and should pick up to about 150,000 to 175,000 jobs a month through the summer".

Employment Trends Index by Month The Conference Board Employment Trends Index reached a Post-Great Recession high of 108.04 in April 2012. The Great Recession cyclical low was 87.82 in May 2009. The Pre-Great Recession peak was 123.86 in March 2007.



Employment Trends Index by Year The Conference Board Employment Trends Index by Year is the average of the related months. The Great Recession low was in 2009 at 89.43 and the Post-Great Recession peak has been in 2012 YTD at 107.29 (preliminary). The Pre-Great Recession Peak was both 2006 and 2007 at 121.95 and 122.6, respectively.

USA Unemployment Rate Dips to 8.1%, Jobs Remaining to Be Restored 5 Million

Bureau of Labor Statistics: Employment Situation Summary

The U.S. government has issued the monthly statistical, political, and market madness called the jobs report. The April 2012 unemployment rate dipped -0.1% to 8.1% and the underemployment rate was steady at 14.5%. These are post-recession lows, the lowest since February 2009 and January 2009 + March 2012, respectively. The USA economy created 115,000 jobs, the 19th consecutive month of job gains.

Net job losses were 8.66 million during the 2008 - 2009 Great Recession. Net job gains have been 3.67 million in the subsequent 2010 - 2012 recovery. That leaves 4.99 million jobs to be restored to get the USA to back to even, to the beginning of 2008. This does not count any net increase in people entering the work force since the end of the Great Recession.

This jobs deficit and the structural shift in the economy explains some of why 50% of 2012 college graduates are unemployed or unemployed. This explains some of the reason 1 in 7 Americans receive food stamps and why just 1 in 4 households anticipate an improved financial situation during the year ahead.

USA Labor Force Participation Rate The April 2012 rate dipped -0.2% to 63.6%, the lowest since December 1981. This means the inverse, 36.4%, of all Americans 16-64 years old were not working for various reasons. The all-time high, since 1948, was a 67.3% participation rate in January through March 2000.




USA Employment to Population Ratio The April 2012 ratio dipped -0.1% to 58.4%. This means the April 2012 inverse, 41.6%, of Americans 16+ years old are not working for various reasons. This ratio has been bottom bouncing, very little upward or downward movement, since September 2009. The ratio has been below 60% since March 2009. The all-time high, since 1948, was 64.6% in January through March 2000.

Global Economic Growth Softens to 5-Month Low

JPMorgan & Markit Global Indexes

Global manufacturing growth reached a 10-month high and global services growth plunged to a 6-month low, the net result being a 5-month low in overall global economic growth for April 2012. The USA, comprising 28.1% of the total, continues as the primary driver of world growth. The Eurozone is the primary drag on global growth, "France, Italy and Spain all reported steeper contractions in total activity, while Germany drifted closer to stagnation". Brazil, China, India, Japan, Russia and the UK reported expansion. The Global All-Industry Output Index has been greater than 50, indicating the global economy is expanding, since August 2009, for 33 consecutive months.

David Hensley, Director of Global Economics Coordination at JPMorgan, said, "Growth of global economic activity eased sharply to a five-month low in April. With new order inflows and job creation also slower at the start of Q2 2012, it looks as if the world economy is set for a softer growth patch heading into mid year. Cost inflationary pressures continued to abate, particularly at service providers".

JPMorgan Global All-Industry Output Index The April 2012 of 52.2 (-2.2) indicates expansion at a much  slower rate and below February's 12-month high (55.4). That was the highest since the Index peaked at 59.1 in February 2011, which was a post-recession high. The post-recession low was 51.3 in October 2011. Historical back data has been revised, only the latest 5 months of revisions are reflected on chart. The general trend is not affected by the revisions.



Global Services Growth Plunges to 6-Month Low

USA Services Sector Growth Drops to 4-Month Low

Global Manufacturing Growth Edges Up to 10-Month High

China Manufacturing Contracts Marginally, Slowdown Stabilizes

USA Manufacturing Growth Rises to 10-Month High

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Global Services Growth Plunges to 6-Month Low

JPMorgan & Markit Global Indexes

A Euro Area contraction pulled down the Global Services PMI. The USA, comprising 28.1% of the total PMI, slipped to a 6-month low, but held up relatively well. The report noted, "The global services output index, excluding the US, suggests that services activity stagnated (on average) outside of the US". In contrast,  China, India, and Brazil expanded at an increasing rate.

David Hensley, Director of Global Economics Coordination at JPMorgan, said, "The rate of expansion in global service sector business activity and new orders eased sharply at the start of the second quarter. The labour market held up comparatively well, however, suggesting that service providers may expect the sector to hold its ground over the coming months".

JPMorgan Global Services PMI The April 2012 PMI of 52.0 (-3.0) indicates expansion at a much slower rate and is a 6-month low. The past 2 months of decreases (-4.3) have negated almost all of the previous 4 months gains (+4.5). The PMI peaked in April 2010 at 56.8, February 2011 at 59.2 (post-recession high), and February 2012 at 56.3. An intermediate term cyclical low of 50.3 was set in November 2009. A PMI greater than 50 indicates global services are expanding. Historical back data has been slightly revised, only the latest 5 months of revisions are reflected on chart. The general trend is not affected by the revisions.



USA Services Sector Growth Drops to 4-Month Low

Global Manufacturing Growth Edges Up to 10-Month High

China Manufacturing Contracts Marginally, Slowdown Stabilizes

USA Manufacturing Growth Rises to 10-Month High

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USA Services Sector Growth Drops to 4-Month Low

ISM: Monthly USA NMI


USA Economy The services sector index (NMI) slowed to a 4-month low of 53.5 and fell below the 12-month average (54.1). Services are still expanding, but at a slower rate, and have grown for 33 consecutive months (since August 2009). The NMI has decreased a significant -3.8 the past 2 months.

Anthony Nieves, Chair of the ISM Non-Manufacturing Business Survey Committee said, "Respondents' comments affirm the slowing rate of growth. In addition, they remain concerned about rising fuel costs and the impact on shipping, transportation and petroleum-based product costs". Both new orders and employment are growing at a slower rate.

ISM Monthly Non-Manufacturing Index (NMI) The April 2012 NMI decreased -2.5 to 53.5, the 2nd consecutive monthly decrease, and the largest monthly decrease since March 2011 (-2.7). The NMI reached a Post-Great Recession peak of 59.0 in February 2011. The Great Recession low was 37.6 in November 2008. A reading greater than 50 indicates services sector expansion.



The 15 non-manufacturing industries reporting growth in April: Retail Trade; Information; Construction; Management of Companies & Support Services; Arts, Entertainment & Recreation; Educational Services; Finance & Insurance; Accommodation & Food Services; Wholesale Trade; Real Estate, Rental & Leasing; Transportation & Warehousing; Other Services; Public Administration; Professional, Scientific & Technical Services; and Health Care & Social Assistance. The 3 industries reporting contraction in April are: Agriculture, Forestry, Fishing & Hunting; Utilities; and Mining.

USA Manufacturing Growth Rises to 10-Month High

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Global Manufacturing Growth Edges Up to 10-Month High

JPMorgan & Markit Global Indexes

The USA, comprising 28.1% of the total PMI, led global manufacturing to a 10-month high. This contrasts to the Eurozone PMI, which is near a 3-year low.  Conditions deteriorated in Germany, France, Italy, Spain, the Netherlands, and Greece. Asia was mixed with strong growth in India, modest growth in Japan, Taiwan and South Korea, and subdued conditions in China.

David Hensley, Director of Global Economics Coordination at JPMorgan, said, "The global PMI edged up to 51.4 in April. The gain reverses slight declines in February and March and leaves the survey little changed on the year. The PMI’s production component is consistent with 2.5% annualized growth in global manufacturing. This represents a step-down from the pace of 1Q12, when growth was boosted by the rebound in floodravaged Thailand".

JPMorgan Global Manufacturing PMI The current reading of 51.4 (+0.3) indicates expansion at a slightly faster rate. The PMI latest peak was 57.4 in February 2011. The post-recession high has been 57.7 in April 2010. The post-recession low was 49.7 in November 2011. Historical back data has been slightly revised, only the latest 5 months of revisions are reflected on chart. The general trend is not affected by the revisions.



China Manufacturing Contracts Marginally, Slowdown Stabilizes

USA Manufacturing Growth Rises to 10-Month High

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USA Manufacturing Growth Rises to 10-Month High

ISM: Monthly USA PMI


USA Economy The manufacturing sector has significantly strengthened and continues growing. USA manufacturing growth reached a 10-month high, the highest since June 2011, and increased for the 33rd consecutive month (since August 2009). The USA economy continued to expand for the 35th consecutive month (since June 2009). The PMI has increased +2.4 the past 2 months, more than counterbalancing the -1.7 decrease in February. Bradley Holcomb, Chair of the ISM Manufacturing Business Survey Committee said, "Sixteen of the 18 industries reflected overall growth".

ISM Monthly Manufacturing Index (PMI) The April 2012 PMI increased +1.4 to 54.8, the 5th increase in the past 6 months. The PMI reached a first post-recession peak in March 2010 at 59.3 and a higher peak in January 2011 at 59.9. The Great Recession low was 33.1 in December 2008. The post-recession low has been 49.2 in July 2009. A reading greater than 50 indicates manufacturing sector expansion and a reading greater than 42.6 indicates overall economic expansion.



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USA Sovereign Debt Now Exceeds GDP: Greetings From Big Brother

Greetings American Citizen:

It has come to my attention that the USA public debt is now greater than the annual GDP. That is, the debt ratio has exceeded 100%. Egan-Jones warned about this in their recent downgrade of United States sovereign debt to AA. This is disturbing plus foolhardy for me to continue giving you a free ride. Your share of the United States public debt is $49,843 and it would help a bunch if you could chip in another $1,349 for your share of this year's interest expense. When can I expect payment?

Where's Uncle Sam? You ignored his collection letters over the years. He retired in frustration. I'm his totalitarian sibling who's running things now. Sam says I have control freak issues. If this spending and borrowing habit doesn't stop, I'll have to do a reset after hyperinflation and economic collapse. Then I will have total power!

You can't pay your share of the debt and interest? You really should, but I tell you what, for now, let's kick the can down the road. In memory of Uncle Sam and the Good Old Days. No one wants to face a Day of Reckoning, even when they know it is inevitable. I'll give you a short-term extension, but it's just for a little while. This living on debt must stop otherwise the crony capitalists and foreigners will buy up all the assets at Depression level prices someday!



Your children and grandchildren can surely figure out a way to pay me for all of these wars & military budgets, Homeland Security, TSA, NSA, & police state infrastructure, federal employee & military pensions & benefits, corporate welfare & subsidies, individual tax breaks & credits, social benefits & care, and all the other free stuff and handouts every last one of you Americans want. You keep telling everyone how smart your kids and grand kids are. They better be! I hope you aren't fibbing, or delusional, like when you say you live in the Land of the Free.

You haven't been noticing, maybe actually ignoring or denying, what's going on? Oh, you were busy posting their cute pics and videos on Facebook while watching TV, movies, and other mass media. FYI, the Republic was lost while you've been self-absorbed and apparently ridiculously gullible. Oops!



Poor Ben Bernanke, he's working so hard to help you, printing money just as fast as he can to keep America afloat. Then he has to worry about those darn interest rates and keep them crammed down in a zero-rate environment. Otherwise, the interest expense on the USA's ever-increasing debt would skyrocket. Not only that, some of the Too Big To Fail banks might actually become insolvent from interest rate shock and counter party panic. The entire frigging financial system might meltdown! On top of all these worries, his bosses keep pestering him about more and more for them - the Wall Street Banksters!

Most likely your progeny will have to pay for all this apathy and greed of yours in unspeakable ways. But, by God, grandpa and grandma got to live the good life! Who said you couldn't be bought? Your price was easy for you, you cheated and haven't paid. You are so selfish plus been bought and sold by the political system.  I won't tell anyone, I understand. It's been tough these past few years and it's still hard out here for an American, right? No worry about your current situation, the price I will extract is the future prosperity and freedom of your children and grandchildren. In the meantime, continue enjoying life as best you can!

Please refer to Greece, Spain, former Soviet republics & satellites, Latin America, et. al, for a preview of the early stages of upcoming American despair. It's difficult to tell you the latter stages when I am in complete command. Of course, the bi-partisan political and corporate corruption will get worse and worse. Freedom, liberties, and rights will vanish as the government and major media, the corporate advertising delivery system,  fuel fear about terrorism, always scaring you with an enemy to justify perpetual war and domestic crackdowns. That's when your descendants will curse you for being a selfish coward and bum as their Bill of Rights is destroyed by tyranny. It gets really, really bad in the New Amerika. Say hello to and tell those precious kiddies of yours to cowboy and cowgirl up! It's going to be a rough ride!

/s/ Big Brother





Charts consist of the latest data available from the Bureau of Economic Analysis (GDP at 3-31-12), U.S. Treasury (Public Debt at 4-27-12), and U.S. Census Bureau (Population at 4-30-12):
Public Debt $15.62 trillion
GDP $15.46 trillion
Population 313.46 million
Annualized Interest Expense $422.71 billion
Effective Interest Rate 2.78%

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USA Personal Income and Consumer Spending Both Reach Another All-Time High

Bureau of Economic Analysis: Personal Income and Outlays


USA Personal Income and Outlays The March 2012 Personal Income and Outlays for the USA both reached yet another all-time high. Personal Income has increased 28 of the past 29 months (since October 2009). Personal Outlays have increased 28 of the past 30 months (since September 2009). Though somewhat older data now, this is an encouraging report. These are preliminary amounts, subject to ongoing revisions.

Personal Income and Disposable Personal Income (Seasonally adjusted at annual rates) Personal Income is at another all-time high of $13.33 trillion and Disposable Personal Income is also at another all-time high of $11.85 trillion. Personal Income is all the personal income in the USA: employee compensation, proprietors' income, rentals, interest, dividends, government social benefits, and business benefits. Disposable Personal Income is Personal Income less government social insurance deductions and personal income taxes.



Personal Consumption Expenditures (Seasonally adjusted at annual rates) Personal Consumption Expenditures are at an all-time high of $11.07 trillion. Personal Consumption Expenditures includes all consumer spending divided into three sub-categories: Durable Goods, NonDurable Goods, and Services. Personal Consumption Expenditures is a sub-category of Personal Outlays, which also includes nonmortgage interest expense and personal transfer payments.



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USA First Quarter GDP a Disappointing +2.2%

Bureau of Economic Analysis: Gross Domestic Product

The Bureau of Economic Analysis released the first (advance) estimate of Q1 2012 GDP which was +2.2% quarter over quarter, a drop from the prior Q4 2011 of +3.0%. The total GDP was an all-time high $15.46 trillion annualized. The GDP has increased quarter over quarter for 11 consecutive quarters, since Q3 2009. Growth rates have ranged from a near-abysmal +0.4% in Q1 2011 to an encouraging +3.9% in Q1 2010.

The Big Question: Where is the USA economy headed? A recession in 2012 does not appear probable, but continues as a low risk. Three scenarios are usually discussed: 1) a double dip recession whereby the GDP will turn negative yet again with a higher unemployment rate, 2) the economy will continue "bottom bouncing" with slow to very slow growth and a continuing relatively high unemployment rate, or 3) the bottom is in and GDP growth will accelerate and full employment is on the horizon.

Scenario 2) with slow to very slow economic growth and a continuing relatively high unemployment rate appears to be the most likely scenario for 2012, with an annual GDP growth projected of approximately +2.0% or a little more. The average of the most recent 4 quarters reported by the Bureau of Economic Analysis is +2.08% (+1.3%, +1.8%, +3.0%, +2.2%).

There is a more important chapter developing in the Story of America. The annualized GDP is $15+ trillion and the funded national debt has also exceeded $15 trillion. Yes, the USA is at the threshold of a national debt that exceeds GDP as the federal budget deficits continue uncontrolled. The sovereign debt to GDP  ratio is reaching, then will exceed, 100%. Depending on the data, we are either at 100% or will be there very soon.

In the minds of many Americans, the 100% benchmark is usually surpassed by wild-eyed socialist countries and absurd dictators as these misguided nations implode into chaos and poverty. In the coming weeks, I'll explore the upcoming American Day or Reckoning, the result of the fiscal and monetary excesses in the American Dream Gone Wild.





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IMF: Global Economic Growth Resuming, Dangers Remain

International Monetary Fund: World Economic Outlook

The latest IMF World Economic Outlook again seems one step behind. This is really a World Economic Review, not Outlook. The latest WEO pronounces resuming growth, but qualifies with downside risk. Risk must always be mentioned by all who predict and dare to wear the prophet's mantle. The prior WEO in January was titled "Global Economic Recovery Stalls, Downside Risks Intensify".

Overall, almost all the GDPs charted below were increased +0.1% to +0.2% for the 2012 and 2013 projections.  Notable GDP increases were:
■ USA was increased +0.3% in 2012 to +2.1%, from +1.8%.
■ Japan was increased +0.4% in 2012 to +2.0%, from +1.6%.
■ Russia was increased +0.7% in 2012 to +4.0%, from +3.3%.
■ Russia was increased +0.4% in 2013 to +3.9%, from +3.5%.

International Monetary Fund (April 17, 2012) The April 2012 edition of the World Economic Outlook assesses the prospects for the global economy, which has gradually strengthened after a major setback during 2011. The threat of a sharp global slowdown eased with improved activity in the United States and better policies in the euro area. Weak recovery will likely resume in the major advanced economies, and activity will remain relatively solid in most emerging and developing economies. However, recent improvements are very fragile. Policymakers must calibrate policies to support growth in the near term and must implement fundamental changes to achieve healthy growth in the medium term.

Regional Key Points:
■ Europe: Crisis, Recession, and Contagion
■ The United States and Canada: Regaining Some Traction
■ Asia: Growth Is Moderating
■ Latin America and the Caribbean: On a Glide Path to Steady Growth
■ Commonwealth of Independent States: Commodity Prices Are the Main Spillover Channel
■ Middle East and North Africa: Growth Stalled, Outlook Uncertain
■ Sub-Saharan Africa: Resilience Should Not Breed Complacency

Actual and Projected GDPs by Year








IMF Sees Progress in Global Recovery, Risks Remain In the latest World Economic Outlook, the IMF says that risks in the Euro zone and rising oil prices are the biggest risks to the economic recovery.

The Elephant in the Room: Egan-Jones Downgrades USA Debt to AA

Egan-Jones Ratings Company has downgraded USA sovereign debt from AA+ to AA, with a negative outlook. That leaves Fitch Ratings and Moody's Investor Service with the deluded conclusion that the United States of America should be rated AAA. Yet even Fitch and Moody's have hedged their malfunctioning debt-rating models with a negative outlook.

Egan-Jones noted concern that "the increasing debt load coupled with the fact that there has been no tangible progress in addressing the country’s growing debt to GDP". Sean Egan continues, "Unfortunately, the debt is growing fairly rapidly while the GDP is not". Wasn't the bi-partisan Super Committee supposed to clean up all this messy budget balancing and skyrocketing national debt? The U.S. Debt Clock is now at $15.63 trillion and just whirring away, while the USA 2011 GDP was estimated by the BEA at $15.09 trillion. Yep, the USA is at the threshold of a fiscal world where debt is greater than GDP with no balanced budget in sight.

The United States federal budget will never be balanced, increasing taxes and cutting spending are not on the bi-partisan negotiating table. You can't get re-elected taking away constituents' spending money or cutting government goodies. Nothing has changed since August 2011 and the political debt-ceiling debacle. Monolithic, self-preserving Washington and powerful, self-absorbed special interests have created a circular fiscal firing squad. American citizens, Main Street, will be the casualties and are as much to blame as the corrupt politicians and corporations. On Easter, there should be national prayer that the global credit card America lives on is not revoked. A credit limit increase would be nice too.

Stay tuned for more notes from underground. The decline of the American Empire continues as the Fed printing presses run 24/7/365...

USA Sovereign Credit Ratings at a Glance
Fitch Ratings: AAA, Outlook Negative
Moody's Investor Service: AAA, Outlook Negative
Standard & Poor's: AA+, Outlook Negative
Egan-Jones Ratings Company: AA, Outlook Negative
Dagong Global Credit: A, Outlook Negative
Weiss Ratings: C-, equivalent to BBB- or 1 level above junk, Outlook Not Provided

Egan-Jones Ratings President on Downgrading U.S. Credit Egan-Jones Ratings President Sean Egan on downgrading U.S. credit due to the government’s mounting debt.

Global Economic Growth Softens: Manufacturing Flat, Services Drop

JPMorgan & Markit Global Indexes


Global Economy Manufacturing growth was flat and services sector growth dropped in March 2012, but global economic growth continues. The U.S. continues as the primary driver of world growth, weighted with a 28.1% share of global GDP. In fact, "The expansion is, however, still heavily dependent on the strong performance of the US economy." The Global All-Industry Output Index has been greater than 50, indicating the global economy is expanding, since August 2009, for 32 consecutive months. An index reading greater than 50 indicates expansion.

JPMorgan Global All-Industry Output Index The current reading of 54.6 (-0.8) indicates expansion at a slower rate and below February's 12-month high. That was the highest since the Index peaked at 59.1 in February 2011, which was a post-recession high. The post-recession low was 51.3 in October 2011. Historical back data has been revised, only the latest 4 months of revisions are reflected on chart. The general trend is not affected by the revisions.




JPMorgan Global Manufacturing PMI The current reading of 51.1 (-0.1) indicates expansion at a slightly slower rate. The PMI recent peak was 57.4 in February 2011. The post-recession high has been 57.7 in April 2010. The post-recession low was 49.7 in November 2011. Historical back data has been revised, only the latest 4 months of revisions are reflected on chart. The general trend is not affected by the revisions.




JPMorgan Global Services PMI The current reading of 55.2 (-1.1) indicates expansion at a slower rate. The Index peaked at 59.2 in February 2011, which was a post-recession high. The post-recession low was 50.3 in November 2009. Historical back data has been revised, only the latest 4 months of revisions are reflected on chart. The general trend is not affected by the revisions.