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January 6, 2022 By Peter Boockvar

It was Bernanke who started this/Claims

Before I get to the claims data I want to quote here what former Fed Chair Ben ‘arsonist turned firefighter’ Bernanke said in a November 4th, 2010 editorial he wrote in the Washington Post defending QE1 and the onset of QE2 in terms of its impact on stocks. With respect to QE1 and at the time the newly implemented QE2, “This approach eased financial conditions in the past and, so far, looks to be effective again. Stock prices rose and long term interest rates fell when investors began to anticipate this additional action. Easier financial conditions will promote economic growth…And higher stock prices will boost consumer wealth and help increase confidence, which can also spur spending. Increased spending will lead to higher incomes and profits that, in a virtuous circle, will further support economic expansion.”

Thus, rather than relying on savings, investment, and quicker income to driver economic growth, QE was specifically meant to lift stock prices in order to so instead. It is not a symptom of QE, it was a direct intended effect. In reverse, the response in stocks should not be a surprise.

Initial jobless claims rose to 207k from 198k. That was 12k more than expected but it’s important to smooth out the influence of the holidays. The 4 week average was 205k vs 200k last week and vs 207k in the week prior. Continuing claims totaled 1.754mm which was above expectations and up from 1.72mm in the week before but again, the holidays messes around with the seasonal calculations and thus let’s wait until next week before making any conclusions here. Either way though, we know the pace of firing’s, in the context of high demand for labor, is back to where it was pre Covid.

INITIAL CLAIMS

CONTINUING CLAIMS

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About Peter

Peter is the Chief Investment Officer at Bleakley Advisory Group and is a CNBC contributor. Each day The Boock Report provides summaries and commentary on the macro data and news that matter, with analysis of what it all means and how it fits together.

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Disclaimer - Peter Boockvar is an independent economist and market strategist. The Boock Report is independently produced by Peter Boockvar. Peter Boockvar is also the Chief Investment Officer of Bleakley Financial Group, LLC a Registered Investment Adviser. The Boock Report and Bleakley Financial Group, LLC are separate entities. Content contained in The Boock Report newsletters should not be construed as investment advice offered by Bleakley Financial Group, LLC or Peter Boockvar. This market commentary is for informational purposes only and is not meant to constitute a recommendation of any particular investment, security, portfolio of securities, transaction or investment strategy. The views expressed in this commentary should not be taken as advice to buy, sell or hold any security. To the extent any of the content published as part of this commentary may be deemed to be investment advice, such information is impersonal and not tailored to the investment needs of any specific person. No chart, graph, or other figure provided should be used to determine which securities to buy or sell. Consult your advisor about what is best for you.

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