Daily Commentary by Larry Baer: The number of Americans standing in line last week to file first-time claims for government unemployment benefits fell 5,000 to a seasonally adjusted 348,000, the lowest mark since February 2008. The previous week's data was revised higher by 2,000.
The Labor Department's initial weekly jobless claims data had little impact on the credit markets. Investors are becoming increasingly concerned about the global economy after reports showed Chinese manufacturing slumped for a fifth month in March. Factory activity in France and Germany also declined sharply this month, suggesting the euro zone is teetering on the edge of another recession.
The "so what" factor here is pretty straightforward - if the global economy continues to slide back into recession - the budding economic recovery here in the states will soon begin to run into stiffening growth headwinds. Should such a scenario develop -- look for strong selling in the stock markets to create a "flight-to-quality" flow of capital back into the relative safe-haven of Treasury debt obligations and agency eligible mortgage-backed securities - a process that almost always proves to be very supportive of the prospects for steady to perhaps fractionally lower mortgage interest rates.
THE MARKET IS ALWAYS RIGHT! . YOU AND I ARE SOME OF THE TIME
