Unemployment Claims at 352,000, Fewest Since 2008

unemployment claims at 352,000, fewest since 2008WASHINGTON (AP) - The number of people seeking unemployment benefits plummeted last week to 352,000, the fewest since April 2008. The decline added to evidence that the job market is strengthening.

Applications fell 50,000, the biggest drop in the seasonally adjusted figure in more than six years, the Labor Department said Thursday. The four-week average, which smooths out fluctuations, dropped to 379,000. That's the second-lowest such figure in more than three years.

A department spokesman cautioned that volatility at this time of year is common. Applications had jumped two weeks ago, largely because companies laid off thousands of temporary workers hired for the holidays.

Still, when weekly applications fall consistently below 375,000, it usually signals that hiring is strong enough to push down the unemployment rate.

"This continues a clear downshift in claims," said Ian Shepherdson, an economist at High Frequency Economics.

Shepherdson suggested that stronger hiring should follow.

Hiring improved in the second half of 2011. In December, employers added 200,000 jobs. That marked the sixth straight month in which the economy added at least 100,000 jobs. And the unemployment rate fell to 8.5 percent, a three-year low.

For all of 2011, the economy added 1.6 million jobs. That was up sharply from 940,000 in 2010. Economists say they expect roughly 1.9 million more jobs to be added this year, according to a survey by The Associated Press.

Still, the job market has a long way to go before it fully recovers from the damage of the Great Recession, which wiped out 8.7 million jobs. More than 13 million people remain unemployed. Millions more have given up looking for work and so are no longer counted as unemployed.

The overall number of people receiving benefits, which isn't seasonally adjusted, rose. More than 7.8 million people received benefits in the final week of last year. They include about 3.6 million people covered by extended-benefit programs begun during the recession.

The manufacturing sector remains a bright spot. Factory output jumped 0.9 percent in December, the Federal Reserve said this week. That was the sharpest monthly gain in a year. Manufacturing gained 225,000 jobs last year, the most since 1997.

The pickup in hiring reflects stronger economic growth. The economy likely grew at an annual rate of about 3 percent in the final three months of last year, economists estimate.

That would be a sharp improvement over the 1.8 percent annual growth rate in the July-September quarter. Rising consumer spending is thought to be fueling much of the gain in the current quarter.

Even so, economists worry that growth could slow in the first half of 2012. Europe is almost certain to fall into recession because of its financial troubles.

And wages aren't keeping up with inflation. The department said in a separate report that average inflation-adjusted hourly earnings dropped 0.9 percent last year.

Without more jobs and higher pay, consumers might have to cut back on spending. That would weigh down growth next year. Consumer spending accounts for about 70 percent of the economy.

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The Iraq war provides a good example. Until November 2000, no OPEC country had dared to violate the US dollar-pricing rule, and while the US dollar remained the strongest currency in the world there was also little reason to challenge the system. But in late 2000, France and a few other EU members convinced Saddam Hussein to defy the petrodollar process and sell Iraq's oil for food in euros, not dollars. In the time between then and the March 2003 American invasion of Iraq, several other nations hinted at their interest in non-US dollar oil trading, including Russia, Iran, Indonesia, and even Venezuela. In April 2002, Iranian OPEC representative Javad Yarjani was invited to Spain by the EU to deliver a detailed analysis of how OPEC might at some point sell its oil to the EU for euros, not dollars.

This movement, founded in Iraq, was starting to threaten the dominance of the US dollar as the global reserve currency and petro currency. In March 2003, the US invaded Iraq, ending the oil-for-food program and its euro payment program.
There are many other historic examples of the US stepping in to halt a movement away from the petrodollar system, often in covert ways. In February 2011 Dominique Strauss-Kahn, managing director of the International Monetary Fund (IMF), called for a new world currency to challenge the dominance of the US dollar. Three months later a maid at the Sofitel New York Hotel alleged that Strauss-Kahn sexually assaulted her. Strauss-Kahn was forced out of his role at the IMF within weeks; he has since been cleared of any wrongdoing.

War and insidious interventions of this sort may be costly, but the costs of not protecting the petrodollar system would be far higher. If euros, yen, renminbi, rubles, or for that matter straight gold, were generally accepted for oil, the US dollar would quickly become irrelevant, rendering the currency almost worthless. As the rest of the world realizes that there are other options besides the US dollar for global transactions, the US is facing a very significant - and very messy - transition in the global oil machine.

January 29 2012 at 5:59 PM Report abuse rate up rate down Reply

The "petrodollar" system was a brilliant political and economic move. It forced the world's oil money to flow through the US Federal Reserve, creating ever-growing international demand for both US dollars and US debt. The petrodollar system spread beyond oil: the majority of international trade is done in US dollars. That means that from Russia to China, Brazil to South Korea, every country aims to maximize the US-dollar surplus garnered from its export trade to buy oil.

As oil usage increased in the 1980s, demand for the US dollar rose with it, lifting the US economy to new heights. But even without economic success at home the US dollar would have soared, because the petrodollar system created consistent international demand for US dollars, which in turn gained in value. A strong US dollar allowed Americans to buy imported goods at a massive discount - the petrodollar system essentially creating a subsidy for US consumers at the expense of the rest of the world. Here, finally, the US hit on a downside: The availability of cheap imports hit the US manufacturing industry hard, and the disappearance of manufacturing jobs remains one of the biggest challenges in resurrecting the US economy today.

There is another downside, a potential threat now lurking in the shadows. The value of the US dollar is determined in large part by the fact that oil is sold in US dollars. If that trade shifts to a different currency, countries around the world won't need all their US money. The resulting sell-off of US dollars would weaken the currency dramatically.

January 27 2012 at 5:46 PM Report abuse +1 rate up rate down Reply

Tehran Pushes to Ditch the US Dollar

India and Iran are negotiating deal to trade oil for gold. Does this matter, you ask? It strikes at both the value of the US dollar and today's high-tension standoff with Iran.

Officially the US & EU is Tehran must be punished for efforts to develop a nuclear weapon. Sanctions on Iran's oil exports meant to isolate Iran and depress the value of its currency to a point that the country crumbles.

Sanctions will not achieve their goals. Iran is far from isolated and its friends - like India - will stand by the oil-producing nation until the US backs down or acknowledges the real matter the American dollar as the global reserve currency.

In the 1970s a deal cemented the US dollar as the only currency to buy and sell crude oil, and from that monopoly on oil trade with the US dollar as the reserve currency for global trades in most commodities and goods. Massive demand for US dollars ensued, pushing the dollar's value up. Countries stored their excess US dollars savings in US Treasuries, giving the US government a vast pool of credit.

If the US dollar loses its position as the global reserve currency, the consequences for America are dire. The dollar's valuation stems from its lock on the oil industry - if that monopoly fades, so too will the value of the dollar. Global fiat currency relationships will change. Gold will rise. Uncertainty around paper money always bodes well for gold, and these are uncertain days indeed.


January 27 2012 at 10:39 AM Report abuse rate up rate down Reply

**** aol

January 24 2012 at 1:50 PM Report abuse rate up rate down Reply

FEDERALISM HAS BEEN DESTROYED BY LIBTARDS. Let it default and fade away we have 50 state govts to do the job and leave all the fed parasites unemployed. Win win! Got gold?

January 24 2012 at 10:26 AM Report abuse +1 rate up rate down Reply

"WEALTH" and so call American " POVERTY" are like Heat and Cold. Cold is the ABSENCE of heat. Poverty is the absence of wealth. This means like Heat can not make anything cold wealth can NOT make any one poor! Poverty is the lack of input of wealth buy the individual. Life is not fair and can be very hard, get over it. Free market wealth is fair. Wealth goes to those that produce for others directly or indirectly through labor to producers. Non producers ( able bodied) do not deserve wealth. That's as fair as it gets. Quit wining and get a job, or make one. And no you aren't owed a job so start kissing as s and be thankful to those that invite you to share in their production. Got gold?

January 24 2012 at 10:25 AM Report abuse +1 rate up rate down Reply

it just count the one that are getting unemplyedment not the one who not getting it,but that the goverment always wanting to look good in electrion year

January 23 2012 at 11:48 PM Report abuse rate up rate down Reply

they don't count the people who are denied or ran out that why the no is low,where I worked 6 people was let go in one week and so far none of us are getting unemployed we waiting on why our employed will let us get it or not

January 23 2012 at 11:45 PM Report abuse rate up rate down Reply

I hear that Unemployment claim they fall every time.One thing you never hear is" WHAT ABOUT THOSE PEOPLE WHO BENEFIT RUN OUT" how they consider those people who they are not getting any more benefit, and I am sure that each single months they fall by the thousend ,how many people they are getting knock out of the system cause they are out of weekly benefits ??

I am sure if they add those too,and guess what unemployment will be still high

January 23 2012 at 6:05 PM Report abuse rate up rate down Reply

Just stop paying fed taxes! I retired and deal strictly cash and carry! I will not enable libtardism! Got gold?

reply to Mike's comment

Outlaw--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------Yes federalism in the hands of libtards has made almost every one an outlaw. Got gold?

January 23 2012 at 4:01 PM Report abuse +1 rate up rate down Reply