The rise in unemployment claim and fall in equipment sales confirms the alleged economic growth of 5.7 percent in the fourth quarter was only a replenishment of inventory and nothing else, showing we're still battling through a recession, and are in no way in the midst of a recovery.
Every time one of these types of reports come out from the Labor Department or Commerce Department, the mainstream media continues to include comments like "unexpected" in attachment with them. There's nothing unexpected about this at all. Anyone that's honest in their reporting and does their homework knows we're far from any type of economic recovery in the U.S., no matter how someone wants to spin the data to say what they want. This data just released supports that again, as the reality sets in we're still in the middle of a recession that's far from over.
Let's look at unemployment first. Claims for first-time jobless benefits in the United States increased by 22,000 for the week ending on February 20, to bring the total to 496,000, according to figures released by the Labor Department. That was 36,000 more than economists were looking for, who had projected jobless claims to stand at 460,000 for the week.
Equipment orders fell off the cliff in January, dropping by 9.7 percent, the biggest decline in about a year. Again, this confirms the so-called economic growth in the fourth quarter wasn't growth at all but replenishment. Growth must be measured by new business and demand and not by replacing stuff that's wearing out or inventory that had been sold down (unless it's demand that caused the inventory to be sold, which it wasn't in this case).
Durable goods orders also fell in January, with that dumb word "unexpectedly" placed beside it by many financial writers. Orders dropped by 0.6 percent, the biggest decline since August.
Spending for capital goods also experienced a decline, falling by 2.9 percent in January, the worst performance since April 2009. This is particularly disturbing because this is one of the metrics used to gauge future spending by businesses. Shipments of capital goods fell by 1.5 percent during the same month said the Commerce Department.
It's no wonder that consumer confidence is taking a big hit, as the numbers and data aren't adding up to the rhetoric thrown around by the government and the increasingly incompetent mainstream media.
Incredibly, some economists are even spinning this to dizzying heights of fantasy, as Chris Low, chief economist at FTN Financial in New York, said this in an e-mail to his clients: economist at FTN Financial in New York, said in an e-mail to clients, “Rising jobless claims, weaker orders and falling consumer confidence suggest the economy is retrenching in the first half of the first quarter.”
Now economists are calling the ongoing recession a "retrenching." No wonder people are confused and frustrated when reporting and assertions like this refuse to communicate the truth that we're still in an economic disaster, and government spending has done nothing to alleviate the problem other than to have future generations pay for their folly.
The views expressed are the subjective opinion of the article's author and not of FinancialAdvisory.com