I know the focus today is on the -32% GDP (FYI will probably be revised worse), but the important number of the day is jobless claims. And they continue to climb.
While it may seem 1.43 million isn’t so bad compared to the prior weeks, it is still 1.5 times HIGHER than anytime before COVID. You can see the comparison to Feb as well.
The market is anticipating a quick recovery with +20% GDP in Q3. If the economy continues to weaken again that is in jeopardy.
A very surprising jobs report this morning. The economy added 2.5mm jobs last month!
Why is this so surprising? All the other data says the economy lost jobs last month. This graph shows the number of new jobless claims, the change in continuing claims, and then the change in jobs reported by the employment report.
The May Job’s number looks very odd compared to the rest of the data. It could just be some “rounding error” from the huge numbers last month.
Please note this survey was completed the week of May 12th. That means this was finish BEFORE ANY REOPENING. This is not about a recovery. This is about something else. I have a theory which I’ll discuss on Monday.