An analyst in the investment racket once told me “Things don’t usually move as fast as you think they will, but when they start moving they often keep going longer and further than you think they will.” The year was 1994, at the end of a long recession, and boy was he right. Hopefully, last week’s unemployment stats together with this one bode well too:
(BB) — Jobless claims dropped by 23,000 to 381,000 in the week ended Dec. 3, the fewest since February, Labor Department figures showed today in Washington. The median forecast of 47 economists in a Bloomberg News survey called for a drop to 395,000. The number of people on unemployment benefit rolls and those getting extended payments also decreased. Companies are firing fewer workers yet may be reluctant to ramp up staff until demand picks up and there’s more clarity on tax breaks due to expire at year-end. While the jobless rate last month unexpectedly fell to 8.6 percent, the lowest in more than two years, faster job growth is needed to push the rate lower and spur consumer spending.
Yes, consumer spending is what drives our mass market economy, for better or for worse, not billionaires buying Maybachs and vacation homes. Apparently everyone knows this, even Bloomberg’s digital rag, except for Republicans and blue-dawg dems in congress.