The Line: Initial Jobless Claims Fall Less Than Expected

While initial unemployment claims fell slightly from the week before, they were higher than the 825,000 that were expected. This seems to be a common theme recently, where even when this number falls, it doesn’t fall enough to satisfy the economists.

In fairness, the improvement in initial claims has basically stalled since September, as this chart shows.

Continuing claims, which trail initial claims by a week, have shown much more improvement recently. They fell by over 1 million in the week ending September 26, to just under 11 million.

This data continues to point out the following:

Weekly data can be volatile
We’ve come a long way from the 6.87 million claims filed the week ending March 28
The pace of economic recovery is slowing, but by no remains are we reversing course
We shouldn’t expect the economic recovery to be smooth

There is renewed optimism about a stimulus deal, let’s hope it happens soon.

Did I really just make a Heroes reference? Since I never watched that show, I guess their marketing was pretty good as I’ve yet to forget about it.

The savings rate in the U.S. has reached a record level during the pandemic, which may be enough to keep the economy OK as we wait for a stimulus. Morgan Stanley estimates households have saved an extra $1.1 trillion as of August than they would have before the pandemic.

This jump in savings is attributed to the CARES Act, which sent checks directly to Americans at a time when lockdowns made it hard to spend money.

Since consumer spending makes up about two-thirds of GDP, this could provide a significant boost to economic growth as we wait for Washington.

McDonald’s same-store sales in the U.S. rose 4.6% in the third quarter, helped by successful promotions such as the one on Travis Scott’s favorite meal. For those of you over 30, Travis is a very popular rapper who likes quarter pounders with cheese and bacon. McDonald’s has also seen a pickup in dinner and group orders.

Wait a minute, why didn’t anyone tell me I could get bacon on a quarter pounder? That sounds like the best thing ever, especially since I’m writing this right before lunch.

Looks like the rest of the world isn’t as hooked on those “two all-beef patties, special sauce, lettuce, cheese, pickles, onions – on a sesame seed bun,” as global sales fell 2.2%.

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