Ouch. Most people had hoped that last week’s rise in new unemployment claims would prove to be a short spike. That turned out not to be the case when the number continued to rise. This week’s Unemployment Insurance Weekly Claims Report disappointed nearly everyone with new claims coming in at 484k. This is the worst number in about 5 months. Last week’s bad number was revised up 3k. This was outside of the Bloomberg consensus range of 460k to 470k. From the report:

In the week ending Aug. 7, the advance figure for seasonally adjusted initial claims was 484,000, an increase of 2,000 from the previous week’s revised figure of 482,000. The 4-week moving average was 473,500, an increase of 14,250 from the previous week’s revised average of 459,250.

The advance seasonally adjusted insured unemployment rate was 3.5 percent for the week ending July 31, a decrease of 0.1 percentage point from the prior week’s unrevised rate of 3.6 percent.

The advance number for seasonally adjusted insured unemployment during the week ending July 31 was 4,452,000, a decrease of 118,000 from the preceding week’s revised level of 4,570,000. The 4-week moving average was 4,518,500, a decrease of 64,500 from the preceding week’s revised average of 4,583,000.

The adjusted data is signaling that the trend is nobody’s friend. The unadjusted data gives us the actual number of people claiming unemployment insurance. This week, it too moved in the bad direction:

The advance number of actual initial claims under state programs, unadjusted, totaled 420,997 in the week ending Aug. 7, an increase of 18,862 from the previous week. There were 482,590 initial claims in the comparable week in 2009.

The advance unadjusted insured unemployment rate was 3.4 percent during the week ending July 31, a decrease of 0.1 percentage point from the prior week. The advance unadjusted number for persons claiming UI benefits in state programs totaled 4,296,612, a decrease of 154,102 from the preceding week. A year earlier, the rate was 4.4 percent and the volume was 5,896,062.

This report shows considerable weakness in both the adjusted and unadjusted numbers. There’s not much left that can be positively spun. Even the good/bad lists, which lag by one week, look pretty poor compared to last week’s stellar outcome:

The good list (-1000 or more): IN, FL, TN, IL, KY, MO, CA, PR

The bad list (+1000 or more): NJ, NY, OH, PA, GA, WI

WI (the worst) was +1,901 vs IN (the best) at -4,377. The sectors responsible were pretty well balanced between the good and bad lists, with construction taking the lead in both lists.

In other news, some mortgage relief may be working its way to some unemployed borrowers. This was part of the financial reform bill. I’m still not seeing significant reports on Tier V extensions to cover those exhausting the maximum 99 weeks of unemployment insurance (less in some states). It is equally significant that I’m not seeing much coverage of the numbers of people exhausting said benefits.

No matter how you slice it, this was a terrible report. There is very little to indicate that we’ll make a significant challenge of the elusive 400k mark any time soon. I’m still on my honeymoon and about to surprise my sleeping wife with breakfast in bed (it’s room service, no heroics involved), so I’m reminding everyone to look for (or cast yourself) one ray of sunshine in the dark and dreariness of today’s headlines.

-By crazynutjob