The stock market’s calmer, but the jury’s still out on what the mortgage mayhem means for the economy. So far, however, there’s scant sign of trouble in the numbers.
Yesterday’s report on initial jobless claims, for instance, offered more of the same of late, which is to say that a middling performance remains the status quo. For the week through August 18, new filings for unemployment insurance actually slipped by 2,000 to 322,000, which is virtually unchanged from a year ago. There may be great drama unfolding in the capital markets, but yawns still dominate analysis of employment’s leading indicators.
Of course, this may be the calm before the storm for the economy. Morgan Stanley’s chief U.S. economist, Richard Berner, told The Wall Street Journal in a story published today that economic trouble is brewing, even if it’s not yet obvious. He predicted that “the housing downturn is going to be more prolonged and deeper than people might have imagined.”