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Traders woke up Thursday morning thinking 8:30 a.m. was going to set the mood for the day. That's when the Department of Labor was scheduled to release its weekly number of new unemployment claims made the previous week.
As it happens, the numbers were awful, at 6.6 million new applicants. That's in addition to the 6.9 million the week before, and 3.3 million two weeks prior.
In other words, an astonishing 16.8 million Americans have lost their jobs in just three weeks. That beats the records set during the Great Depression by several times over (of course, the U.S. has a much larger population now – but still…)
This weekly number was also way worse than expected, with analysts estimating something between 3 million and 5 million new claims.
But instead of dropping, markets opened up more than 1.5%. It's as if 6.6 million people losing their jobs in a single week won't affect companies negatively.
Well, in the short term, that may be the case. Because at almost the same time that the Department of Labor released its data, U.S. Federal Reserve Chair Jerome Powell went on air.
What he announced sent pre-market trading skywards. It was yet another stimulus plan, for another $2.3 trillion.
This time, the Fed will be guaranteeing loans made to states and municipalities, and also to households.
But the most important piece of the announcement has the Fed doing something it has never done before…
And it sent one part of the market up three times more than the Dow.
Should you jump on the bandwagon? Here's what I think… Full Story