Chin Up in the Downswing

positive economic news during recession

April Economic Numbers Looking Better; Stabilization Equals Optimism

May 08, 2009 07:00 PM
by Anne Szustek
Positive financial news to close out the week: the latest Labor Department data shows fewer first-time applicants for unemployment, retailers posted better-than-expected results for April and more economists are joining the optimism bandwagon.

New Unemployment Filings Drop More than Expected

During the week ending on May 2, the number of first-time filers for unemployment benefits dropped to 601,000; that’s a decrease of a little more than 5 percent from the previous week’s 635,000.

Total unemployment figures did hit a record high 6.35 million this week, according to statistics from the U.S. Department of Labor. But as we told you in Wednesday’s “Chin Up in the Downswing,” Federal Reserve Chief Ben Bernanke cautioned that even as the economy rebounds, unemployment figures might take a while to catch up. 

Teen Threads Help Work Sales Figure Magic

Some 74 percent of chain stores beat April sales projections, according to statistics published by Investor’s Business Daily. April figures got an assist from sales during the Easter holiday. At stores open a year or more, April sales were up 1.5 percent year-on-year, Retail Metrics President Ken Perkins told IBD, which beat analyst estimates of a 0.1 percent bump. Helping to lead the way were teen apparel chains Aeropostale and Buckle, which last month posted y-o-y same-store sales increases of 20 and 18.2 percent, respectively. 
Aeropostale and Buckle have been doing a good job of weathering this recession . The March 11 edition of Chin Up mentioned Buckle’s 18 percent y-o-y increase in fiscal income during the fourth quarter of 2008 and on March 16, Chin Up featured Aeropostale’s 17 percent growth in sales during the fourth quarter of 2008 from the same period a year earlier.

More Economists Agree: Economy is Improving

Bernanke was just one of several economists and financiers profiled in Wednesday’s Chin Up who predict a foreseeable end to the recession: chief among them were San Francisco Fed Chief Janet Yellen and JPMorgan Chase CEO Jamie Dimon, but others were providing backup.

Now, at least two other economists have joined the “No More Recession by the End of 2010” tour. IHS Global Insight chief U.S. economist Nigel Gault wrote in a report released this week and cited by New Mexico Business Journal that “after back-to-back declines in real GDP of more than 6 percent (annual rates), the period of economic free-fall seems over.”

Supporting his hypothesis are better-than-expected consumer spending figures during the first quarter of this year and signs pointing to improvement in the housing sector. He sees GDP increasing by the end of 2010.

Richmond, Va., Fed Chief Jeffrey Lacker had much the same to say to the Washington, D.C. Chamber of Commerce. “If the emerging stability in housing and consumer spending persists, as I expect,” he was quoted as saying by Reuters, “some segments of business investment spending should bottom out by the end of the year and economic growth would then turn positive.”

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