Thursday, August 19, 2010

Initial claims for state unemployment benefits increased by 12,000 to a seasonally adjusted 500,000 during the week ended August 14^th, the highest mark for this metric since mid-November. Today's data covered the survey week for the government's much more closely watched August nonfarm payroll report scheduled for release on Friday, September 3^rd. Once this morning's disappointing numbers from the labor sector hit the newswires mortgage investors quickly priced-in expectations that the August headline nonfarm figure will show the loss of more than 130,000 jobs as a cooling economy discourages employers from adding staff and prompts some companies to step-up more dismissals.

The developing story from the labor sector will undoubtedly ratchet up pressure on the Fed and the Obama administration to introduce more stimulus measures to prevent the U.S. economy from spiraling deeper into the depths of the recession. There are as many options of what form a stimulus package may take as there are people who will want to provide input into its creation.