Nearly 1.5 million additional Americans filed new, initial claims for unemployment last week according to the latest report from the Labor Department.
The Bureau of Labor Statistics tell us unemployment claims barely budged after dropping by just 60,000.
“All is not well in this economy,” said Chris Rupkey, chief economist at MUFG in New York. “While it counts as good news that businesses are ordering more equipment in May as the states reopened, the second wave of the pandemic may keep companies cautious in the months ahead when it comes to making new investments in the country’s future.”
Initial claims for state unemployment benefits fell 60,000 to a seasonally adjusted 1.480 million for the week ended June 20, the Labor Department said. Economists polled by Reuters had forecast 1.3 million claims in the latest week.
Claims have dropped from a record 6.867 million in late March, but progress has slowed and they are more than double their peak during the 2007-2009 Great Recession.
Speaking of that "second wave" -- if you want to call it that -- Trump's top economic adviser Larry Kudlow conceded today that some areas may have go back into lockdown to stop the spread of the virus.
"There will be some shutdowns individually ... in individual places and certain stores. We are keeping a very close eye on this," Kudlow said in an interview on Fox Business Network.
"We're going to have hot spots. No question," he later told reporters at the White House. "We just have to live with that."
You know, the economic case for shutting down to begin with was to get control of the virus and prevent future shutdowns or a resurgence that would sap consumer demand. And when the pandemic began, most economists warned that the consequences of a second wave could be worse than the initial wave because businesses have already been weakened.
I don't like to be alarmist, but I don't see things going very well for us through the rest of this year. The lack of leadership from Trump and the federal government means we'll never have a national strategy for containing the virus and hot spots, as Larry Kudlow says, will keep popping up.
Texas Governor Greg Abbott has hit the pause button on the state's reopening plans, but I'm not sure what that's suppose to accomplish. The state's current status quo for reopening the economy is what enabled the current outbreak and Abbott is not willing to order anything closed again.
I'm glad I don't manage a business because I have no idea how anyone is suppose to plan for the next month much less the next six months.