Jobless claims surge; Filings at highest since March 2002

In the other major piece of economic data out today, initial jobless claims filings surged to 455,000 in the week ended August 2 from 448,000 in the prior week. That was well above the 425,000 forecast of economists polled by Bloomberg ... the highest in any week since March 2002 ... and one of the highest readings going back a couple of decades (as you can see in the chart above).

This is yet another indicator that the economy is either already in recession or on the verge of one, in my view. The weakening labor market is also a potential threat to the housing and credit markets. After all, when you lose your job, you have less money available to service debt and you become less willing to commit to the purchase of big-ticket items, including homes and cars.