- The Washington Times - Thursday, November 13, 2008


New claims for unemployment benefits soared to a seven-year high last week, reaching their largest total since shortly after the September 11 terrorist attacks and the second-highest since 1992.

New jobless claims totaled 516,000 last week, representing a 32,000 increase over the previous week, the Labor Department reported Thursday morning. The four-week average of claims, which smooths out week-to-week volatility, increased by more than 13,000 to 491,000, reaching it highest level since 1991.

The government reported last week that employers shed 240,000 jobs in October after jettisoning 284,000 jobs in September. Payrolls have declined for 10 consecutive months. The October unemployment rate jumped to 6.5 percent, its highest level in 14 years.

In a separate report, nearly 280,000 U.S. households received a foreclosure filing in October, including a default notice, a warning of a pending auction or a notification of foreclosure, according to RealtyTrac Inc. of California. October foreclosure filings were 25 percent higher than year-earlier levels, but that rate of increase represented a slowdown from the average year-over-year gains of 50 percent that were incurred earlier this year.

Meanwhile, rapidly declining oil prices and a plunge in crude oil imports overcame a nearly $10 billion decrease in exports in September, helping to reduce the U.S. trade deficit by 4.4 percent that month.

The trade deficit declined in September by $2.6 billion as crude oil imports plunged by more than 1.5 million barrels per day, the Commerce Department reported Thursday. The average price for a barrel of crude oil declined from a record $124.66 in July to $107.58 in September.

Oil prices continue to slide, dipping briefly below $55 a barrel Thursday as bad economic news from the world’s largest economies heightened fears that a global downturn will reduce demand for crude.

That prospect did not give Wall Street much to cheer about Thursday. In late-morning trading, the Dow Jones Industrial Average dropped 42 points (0.5 percent) to 8,241; the Standard & Poor’s 500 stock index was down 2 points (0.2 percent) to 850; and the Nasdaq composite fell 18 points (1.2 percent) to 1,481.

The $9.9 billion decline in exports in September reflected the worldwide economic slowdown as U.S. trading partners demanded fewer U.S. goods and services.

“The trade deficit will make the recession longer and deeper, and lessen the positive benefits of a second stimulus package, said Peter Morici, a business professor at the University of Maryland.

“Simply, money spent on Middle East oil, Chinese televisions and coffee markers, Japanese and Korean cars can’t be spent on U.S.-made goods and services, unless offset by a comparable amount of exports,” he said. “Since U.S. imports exceed exports by almost 5 percent of gross domestic product, the trade deficit creates an enormous drag on demand for U.S.-made goods and services. Along with the credit crisis and resulting slowdown in new housing and commercial construction, the trade deficit is driving up unemployment.”

Exports of civilian aircraft, which can vary a lot from month to month, fell by $3.3 billion to $2.2 billion in September. Major U.S. export products included semiconductors, pharmaceutical products, generators, industrial machines, telecommunications equipment, computer accessories and aircraft engines.

Besides crude oil and petroleum products, major U.S. imports included automotive vehicles and parts, telecommunications equipment, pharmaceuticals, clothing, textiles, furniture and other household goods.

Excluding petroleum products, the merchandise trade deficit increased by nearly $2 billion to $35.6 billion. The trade deficit in advanced technology products increased to a record $7.8 billion in September as ATP exports declined $3.6 billion, falling to their lowest level since October 2007.

The merchandise trade deficit with China reached a record $27.8 billion. The United States also recorded big trade deficits with OPEC ($13.4 billion), the European Union ($8.3 billion), Canada ($7.8 billion), Japan ($5.6 billion), Mexico ($4.9 billion) and Venezuela ($3.5 billion).

The United States recorded September trade surpluses with Hong Kong ($1.7 billion), Singapore ($0.9 billion), Australia ($0.8 billion) and Egypt ($0.2 billion).

Sign up for Daily Newsletters

Manage Newsletters

Copyright © 2021 The Washington Times, LLC. Click here for reprint permission.

Please read our comment policy before commenting.


Click to Read More and View Comments

Click to Hide