Initial jobless claims dropped by 4,000 to 621,000 in the week ended May 30th from a revised 625,000 the prior week. The number of people collecting unemployment actually fell, yes fell, for the first time in five months to 6.735 million from 6.75 million. Admittedly, this is an improvement, but it is what I would call a slight improvement, hence the headline above. What it does not warrant is the headline Bloomberg has stating the decline followed by the phrase “signal worst of slump ending.” This seems to be Bloomberg’s new phrase that they must be required to tack on to the end of every single economic data point released since the March low. Although in a strange oversight, they forgot to change the headline about Latvia to: “Latvia Central Bank Vows to Defend Currency Peg As Investors Flee, Signaling Worst of the Eastern European Crisis is Over.” Since I’ve pointed it out, they’ll probably change it.
I don’t know who gave the directive (Mr. Geithner doesn’t seem to be as much of a heavy as his predecessor, so I can’t point the finger at him), but it’s become somewhat comical how much the mainstream press has been cheerleading the latest rally by pumping the somewhat anemic economic data as definitive that we’ve seen the worst, and are moving on to a V-shaped recovery. I’m still skeptical of a recovery that will be anything more than a flatline, as I have no idea where the next spurt of growth is going to come from. We’re still wringing out the excesses from a ridiculous boom, and all of the government intervention so far has done nothing more than stabilize the downward spiral. Retail sales numbers are still to come, as is tomorrow’s payroll report. Both will provide further clarity about the economic outlook.