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Economy

Jobless Claims Slightly Miss Forecast, Trend Down for 12th Straight Week

Washington, D.C. (PPD) — The U.S. Labor Department (DOL) reported initial jobless claims came in more than expected at 1,480,000 for the week ending June 20, a decrease of 60,000. The previous week was upwardly revised (+32,000) to 1,540,000.

Claims soared due to the mitigation efforts to slow the spread of the coronavirus (COVID-19), though have now declined for the twelfth straight week and of 58,000 from the previous week’s upwardly (+24,000) 1,566,000.

Forecasts ranged from a low of 1,250,000 to a high of 1,400,000. The consensus forecast was 1,380,000. The 4-week moving average was 1,620,750, a decrease of 160,750 from the previous week’s upwardly revised average (+8,000) at 1,781,500.

Nearly 49 million Americans filed initial claims for unemployment benefits as a result of the efforts to slow the spread of coronavirus (COVID-19). However, millions now appear to have returned to work given lagging data.

Lagging Jobless Claims Data

U.S. initial jobless claims graph on a tablet screen. (Photo: AdobeStock)
U.S. initial jobless claims graph on a tablet screen. (Photo: AdobeStock)

The advance seasonally adjusted insured unemployment rate was 13.4% for the week ending June 13, a decrease of 0.5 percentage point. The previous week’s rate was revised down by 0.2 from 14.1 to 13.9%.

The insured unemployment rate hit the first high of the current crisis at 8.2% for the week ending April 4. The all-time high prior to that was 7.0%, recorded in May of 1975. On April 11, it rose to 11.0% and 12.4% on April 25.

Under the Trump Administration, this rate had fallen to an all-time low 1.1% and remained at 1.2% just weeks ago, as recently as March 14. But that was before coronavirus (COVID-19) mitigation efforts.

The advance number for seasonally adjusted insured unemployment during the week ending June 13 was 19,522,000, a decline of 767,000 from the previous week. The previous week’s level was revised down by 255,000 from 20,544,000 to 20,289,000.

The 4-week moving average was 20,421,250, down 329,750 from the previous week. The previous week’s average was downwardly revised by 63,750 from 20,814,750 to 20,751,000.

During the week ending June 6, Extended Benefits were available in the following 44 states: Alabama, Alaska, Arkansas, California, Colorado, Connecticut, the District of Columbia, Delaware, Georgia, Hawaii, Idaho, Illinois, Iowa, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Puerto Rico, Rhode Island, South Carolina, Tennessee, Texas, Vermont, Virginia, Washington, West Virginia, and Wisconsin.

The highest insured unemployment rates in the week ending June 6 were in Nevada (22.6), Puerto Rico (20.6), Hawaii (18.3), New York (17.8), California (17.3), Michigan (16.9), Louisiana (16.2), Massachusetts (16.2), the Virgin Islands (16.2), and Connecticut (15.8).

The largest increases in initial claims for the week ending June 13 were in Oklahoma (+7,254), Texas (+5,047), New Jersey (+3,272), New York (+1,351), and Louisiana (+1,243), while the largest decreases were in Florida (-24,013), Maryland (-18,188), Massachusetts (-14,731), California (-14,412), and Michigan (-6,543).

Initial jobless claims came in more than

Politics

Peter Strzok Notes Reveal ‘Crossfire Razor’ Was ordered By Barack Obama, Joe Biden Suggested Using the Logan Act to Persecute Michael Flynn

National Security Adviser Michael Flynn puts Iran 'on notice' during a press conference in response to a missile launch. (Photo: AP)
National Security Adviser Michael Flynn puts Iran ‘on notice’ during a press conference in response to a missile launch. (Photo: AP)

Washington, D.C. (PPD) — The U.S. Court of Appeals for the District of Columbia (D.C.) ordered District Judge Emmet Sullivan to approve the Justice Department (DOJ) motion to dismiss the case against Michael Flynn. The 2-1 ruling granted a writ of mandamus — an order for a government official to carry out a duty.

In May, the Justice Department revealed it was dropping its case against Lt. General Flynn, the first and former National Security Adviser to President Donald J. Trump. The development came after “newly discovered and disclosed information” that raised serious questions about the nature of the investigation, which led to Special Counsel Robert Mueller.

U.S. Attorney Jeff Jensen recommended dropping the case after review. Of the two trances of documents totaling 15 pages, the first four unsealed pages contained clear evidence the investigation and prosecution — code name “Crossfire Razor” — was a setup for a perjury trap.

The documents — inappropriately withheld from the defense — contained handwritten notes from Bill Priestap, then-Assistant Director of the Counterintelligence Division for the Federal Bureau of Investigation (F.B.I.). The notes state agents aimed “to get him [Flynn] to lie so we can prosecute him or get him fired.”

On January 24, 2017, federal agents interviewed Lt. General Flynn under false pretenses and without counsel about a conversation he had with Russian Ambassador Sergey Kislyak. At the time of the conversation, Lt. General Flynn was the top foreign policy adviser to then-president-elect.

The note-taker wrote that one objective of the interview was to “get [Flynn] to admit breaking the Logan Act,” a 1799 law widely viewed as unconstitutional. It intends to prohibit private citizens from speaking with foreign governments about official U.S. policy, but has never been successfully used in a prosecution against anyone, ever.

But Judge Sullivan refused and took unusual, unprecedented steps to keep the case from being dismissed. He ordered a hold on the motion and instead appointed retired judge John Gleeson to look at whether Lt. General Flynn could be held in criminal contempt for perjury.

The Justice Department disclosed to the court separate handwritten notes from fired FBI Agent Peter Strzok. They detail how “Crossfire Razor” was ordered by then-President Barack Obama and then-Vice President Joe Biden in the Oval Office on January 5, 2017.

In fact, the notes from Mr. Strzok reveal it was Mr. Biden himself who suggested using the Logan Act to persecute Lt. General Flynn. Fired former FBI Director James Comey even acknowledged the calls with Ambassador Kislyak “appear legit”.

Earlier in June, Director of National Intelligence (DNI) John Ratcliffe made public the transcripts from the wiretapped calls between Lt. General Flynn and Ambassador Kislyak. In May, former Acting-DNI Richard Grenell declassified a list of Obama Administration officials who sought to unmask Lt. General Flynn, including Mr. Biden and former White House Chief of Staff Denis McDonough.

Flynn-Kislyak-TranscriptsDownload

“For the foregoing reasons, we grant Flynn’s petition for a writ of mandamus in part and direct the district court to grant the government’s Rule 48(a) motion to dismiss,” the powerful appellate court’s decision stated. “In light of that grant, we vacate the district court’s order appointing an amicus as moot.”

President Trump cheered the decision on Twitter. A White House sources tells People’s Pundit Daily (PPD) the president was “pleased with the court’s decision.”

“Great! Appeals Court Upholds Justice Departments Request To Drop Criminal Case Against General Michael Flynn!”

In May 2019, Attorney General William Barr assigned U.S. Attorney John Durham in Connecticut to investigate the origins of and potential wrongdoings in the probe. The two men enjoyed bipartisan praise and impeccable reputations before they threatened to expose the “Russian Collusion” investigation as corrupt.

Michael-Flynn-DC-Appeals-Court-OpinionDownload

The Court of Appeals for the District

Economy

The Federal Housing Finance Agency (FHFA) House Price Index (HPI) rose 0.2% in April, less than the consensus forecast. House prices rose 5.5% from April 2019 to April 2020. The 0.1% gain previously reported for March 2020 remains unchanged.

Forecasts ranged from a low of -0.4% to a high of +6.0%. The consensus forecast was +0.4%.

Real estate market with price tags above home properties to illustrate house prices in 3D abstract. (Photo: AdobeStock)
Real estate market with price tags above home properties to illustrate house prices in 3D abstract. (Photo: AdobeStock)

“U.S. house prices posted another positive monthly increase in April,” Dr. Lynn Fisher, Deputy Director of the Division of Research and Statistics at FHFA, said. “Regionally, results varied. Two of the usually stronger growth areas, the Mountain and Pacific divisions, were flat over the month but other divisions continued to experience strong price appreciation even with all of the COVID-19 challenges.”

For the nine census divisions, seasonally adjusted monthly house price changes from March 2020 to April 2020 ranged from -0.5% in the South Atlantic division to +0.8% in the West South Central division. The 12-month changes were all positive, ranging from +5.0% in the Middle Atlantic division to +6.8% in the Mountain division.

“Both the New England and South Atlantic regions saw monthly decreases in prices, but all divisions posted positive year over year growth of at least 5 percent,” Dr. Fisher added. “The number of transactions used to estimate the HPI were slightly down from March to April but were still a robust sample.”

“We expect the normal spring bump in sales was pushed off by the COVID-19 shutdowns and may extend into the summer months as states reopen and real estate sales pick back up.”

On Tuesday, the U.S. Census Bureau and the U.S. Department of Housing and Urban Development jointly reported the new residential sales statistics for May 2020. New home sales unexpectedly soared 16.6% (±15.5%) to a seasonally adjusted annual rate of 676,000 in May, easily beating the consensus forecast.

The Federal Housing Finance Agency (FHFA) House

Inside the Numbers

Watch Live 10:00 AM EST (PPD) — On Inside The Numbers, we discuss the primary results in Kentucky and New York, more hoaxes and V-Shaped economic data.

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Theme Song: “Bad Habit” By Grammy Considered Bowen Band

Discussed on the Show

On Inside The Numbers, we discuss the

Economy

New Residential Sales Easily Beat Forecast, Nearly No Effects Due to COVID-19 in April and May

Washington, D.C. (PPD) — The U.S. Census Bureau and the U.S. Department of Housing and Urban Development jointly reported the new residential sales statistics for May 2020. New home sales unexpectedly soared 16.6% (±15.5%) to a seasonally adjusted annual rate of 676,000 in May, easily beating the consensus forecast.

This month of April was revised down to a rate of 580,000, when most businesses and government were operating on a limited capacity or had ceased operations totally. Still, new home sales have shown little impact due to the pandemic and are now 12.7% (±23.5%) above the May 2019 estimate of 600,000.

An exchange showing one hand giving cash to the another for new house and keys, a vector illustration for new home sales. (Photo: AdobeStock)
An exchange showing one hand giving cash to the another for new house and keys, a vector illustration for new home sales. (Photo: AdobeStock)

New home sales were on fire prior to the pandemic and beginning to show the fourth cylinder firing in a strong economy, peaking at 774,000 in January. Forecasts for May ranged from a low of 600,000 to a high of 670,000. The consensus forecast was only 636,000.

The median sales price of new houses sold in May 2020 was $317,900. The average sales price was $368,800. The seasonally-adjusted estimate of new houses for sale at the end of May was 318,000. This represents a supply of 5.6 months at the current sales rate.

New home sales unexpectedly soared 16.6% to

Inside the Numbers

Watch Live 10:00 AM EST (PPD) — On Inside The Numbers, we discuss more economic data indicating a strong recovery for May and June, the Tulsa Rally and John Bolton.

Subscribe on YouTube!

Theme Song: “Bad Habit” By Grammy Considered Bowen Band

Discussed on the Show

On Inside The Numbers, we discuss more

Economy

CFNAI Unexpectedly Rebounds, Led By Production and Employment

The Chicago Fed National Activity Index (CFNAI) rose to 2.61 in May from -17.89 in April, fueled by improvements in production- and employment-related indicators. The better than expected result indicates economic growth rebounded strongly in May.

Forecasts ranged from a low of -10.00 to a high of -4.00. The consensus forecast was -4.00, indicating economists expected continued contraction for the month.

The Chicago Fed National Activity Index (CFNAI) is a weighted average of 85 indicators of growth in national economic activity derived from four broad categories: 1) production and income; 2) employment, unemployment, and hours; 3) personal consumption and housing; and 4) sales, orders, and inventories.

All four broad categories of indicators used to construct the index made positive contributions in May, and all four categories increased from April. The index’s three-month moving average, CFNAI-MA3, moved up to –6.65 in May from –7.50 in April.

The Chicago Fed National Activity Index (CFNAI)

Policy

Cartoon workingman reluctantly paying taxes. (Photo: AdobeStock/PPD/Adiano)
Cartoon workingman reluctantly paying taxes. (Photo: AdobeStock/PPD/Adiano)

Assuming the goal is more prosperity, lawmakers who work on tax issues should be guided by the “Holy Trinity” of good policy.

  1. Low marginal tax rates on productive activity such as work and entrepreneurship.
  2. No tax bias (i.e., extra layers of tax) that penalizes saving and investment.
  3. No complicating preferences and loopholes that encourage inefficient economic choices.

Today, with these three principles as our guide, we’re going to discuss a major problem in how dividends are taxed in the United States.

Simply stated, there’s an unfair and counterproductive double tax. All you really need to know is that if a corporation earns a profit, the corporate income tax takes a chunk of the money. But that money then gets taxed again as dividend income when distributed to shareholders (the people who own the company).

So why is this a bad thing?

From an economic perspective, the extra layer of tax means that the actual tax burden on corporate income is not 21 percent (the corporate tax rate) or 23.8 percent (how dividends are taxed on the 1040 form), but a combination of the two rates. And when you include the average additional tax imposed at the state level, the real tax rate on dividends in the United States can be as high as 47.47 percent according to the Organization for Economic Co-operation and Development (OECD).

You don’t need to be a wild-eyed supply-sider to think that incentives to build businesses and create jobs are adversely affected when the government grabs nearly half of the additional income generated by corporate investment.

Keep in mind, by the way, that workers ultimately bear most of this tax since lower levels of investment translate to lower wages.

So what’s the solution?

If we want a properly designed system for taxing businesses, we know the answer. Just get rid of the extra layer of tax.

A 2015 report from the Tax Foundation explains how various types of “corporate integration” can achieve this goal.

The United States’ tax code treats corporations and their shareholders as separate taxable entities. The result is two layers of taxation on corporate income: one at the corporate level and a second at the shareholder level. This creates a high tax burden on corporate income, increasing the cost of capital. The double taxation of corporate income reduces investment and distorts business decisions. … Many developed countries have integrated their tax systems in order to mitigate or completely eliminate the double taxation of corporate income. …There are several ways to integrate the corporate tax code. Corporate income can be fully taxed at the entity level (a corporate income tax) and then tax exempt when passed to shareholders as dividend income, or corporations could be given a deduction for dividends passed to their shareholders, who pay tax on the dividend income. Alternatively, shareholders and corporations both pay tax on their income, but shareholders can be given a credit to offset taxes the corporation already paid on their behalf.

For what it’s worth, I think it would be best to get rid of the double tax by eliminating the layer of tax that is imposed on individuals.

In other words, modify the above image in this way.

Though the economic benefit would be the same if the corporate income tax was abolished and the income was taxed one time at the individual level.

I’ll close today’s column with a bit of good news.

A few years ago, the United States had a much higher burden of double taxation because the corporate tax rate was so high. Indeed, the combined tax rate on dividends was the fourth-highest in the developed world.

Today, thanks to the 2017 tax reform, the combined tax rate is “only” the tenth-highest in the developed world.

Assuming the goal is more prosperity, lawmakers

Opinion

In Recent Months, the Need for the Second Amendment Has Been on Full Display

A 3D illustration of an American Flag formed out of bullets. (Photo: AdobeStock)
A 3D illustration of an American Flag formed out of bullets. (Photo: AdobeStock)

In recent months, governments released prisoners and announced that some laws wouldn’t be enforced because of the coronavirus. Now, with protests against police misbehavior, we’re seeing governments fail to maintain law and order. As suggested by this excellent video by Reason, these developments bolster the case against gun control.

But does this mean politicians will be more supportive of the Second Amendment? The answer — at least for anyone with an IQ above room temperature — should be yes.

From an economic perspective, one major goal is to change the cost-benefit analysis for criminals. If bad guys have to worry that good guys may be armed, that significantly increases the potential cost of illegal behavior.

A well-functioning system of law enforcement can help, of course, but that’s not a description of how things work in some communities – even in normal times, much less when there’s civil unrest.

But all this evidence and analysis doesn’t seem to matter for Joe Biden. A look at his campaign website shows support for a wide range of gun-control laws from the soon-to-be Democratic nominee.

…gun violence is a public health epidemic. …In 1994, Biden – along with Senator Dianne Feinstein – secured the passage of 10-year bans on assault weapons and high-capacity magazines. As president, Joe Biden will defeat the NRA again. …As president, Biden will: …Ban the manufacture and sale of assault weapons and high-capacity magazines. …Regulate possession of existing assault weapons under the National Firearms Act. …Biden supports legislation restricting the number of firearms an individual may purchase per month to one. …End the online sale of firearms and ammunitions. …Give states incentives to set up gun licensing programs.

What’s especially discouraging is that Biden apparently hasn’t learned anything about so-called assault weapons since 1994.

In a 2019 column for Reason, Jacob Sullum dissected Biden’s incoherent views on the topic.

Joe Biden…is still proud of the ban on “assault weapons”… Biden argues that it made mass shootings less common…, citing a study reported in The Journal of Trauma and Acute Care Surgery last January. But that is not what the researchers, led by New York University epidemiologist Charles DiMaggio, actually found. …The study…looked not at the number of mass shootings, as Biden claims, but the number of mass-shooting deaths as a share of all firearm homicides. The difference in total fatalities during the period when the ban was in effect amounted to 15 fewer deaths over a decade, or 1.5 a year on average, including mass shootings that did not involve weapons covered by the ban. …The causal mechanism imagined by Biden is even harder to figure out. He describes “assault weapons” as “military-style firearms designed to fire rapidly.” But they do not fire any faster than any other semi-automatic. …Under the 1994 ban, removing “military-style” features such as folding stocks, flash suppressors, or bayonet mounts transformed forbidden “assault weapons” into legal firearms, even though the compliant models fired the same ammunition at the same rate with the same muzzle velocity as the ones targeted by the law.

I wonder if Biden understands the policy he’s advocating.

Does he think that “assault weapons” are actual machine guns, capable of firing multiple rounds with one pull on the trigger — a remarkably common misconception among gun-control advocates?

Or, if he understands that a so-called assault weapon is just like any other gun (firing one round each time the trigger is pulled), then why would he think anything would be achieved by banning some guns and leaving others (that work the same way) legal?

Perhaps most relevant, does he even care what the evidence shows?

The bottom line is that people are “voting with their dollars” for gun ownership for the simple reason that they know it’s unwise to trust government (either to protect them from crime or to respect their rights).

But that doesn’t mean their constitutional freedoms will be secure if Biden wins the 2020 election.

Leftwing politicians have bolstered the case against

Politics

Image from the cover of the Defense Space Strategy (DSS) released by the U.S. Department of Defense on June 17, 2020. (Photo: DoD/SS)
Image from the cover of the Defense Space Strategy (DSS) released by the U.S. Department of Defense on June 17, 2020. (Photo: DoD/SS)

Washington, D.C. (PPD) — Last week, the U.S. Defense Department released a Defense Space Strategy (DSS) providing “guidance to DoD for achieving desired conditions in space over the next 10 years.”

“The DoD desires a secure, stable, and accessible space domain, whose use by the United States and our allies and partners is underpinned by comprehensive, sustained military strength,” the summary of the strategy states.

“The strategy includes a phased approach for the defense enterprise to move with purpose and speed across four lines of effort (LOEs): (1) build a comprehensive military advantage in space; (2) integrate space into national, joint, and combined operations; (3) shape the strategic environment; and (4) cooperate with allies, partners, industry, and other U.S. Government departments and agencies.”

The Defense Space Strategy (DSS) lays out three defense objectives and cites Russia and China as the main threat to achieving “desired conditions” in space. North Korea and Iran as growing threats.

The three defense objectives are as follows:

  • Maintain Space Superiority
  • Provide Space Support to National, Joint, and Combined Operations
  • Ensure Space Stability

The DSS also acknowledges several “challenges” and “opportunities” arising from achieving the three defense objectives. The entire report can be read below.

2020_DEFENSE_SPACE_STRATEGY_SUMMARYDownload

The U.S. Defense Department released a Defense

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