Several months ago many of the economic indicators were showing improvement, albeit very small and insufficient to make up for the depth of our current crisis. The important thing politically was it at least looked like things were moving in the right direction, which is critical for an incumbent President heading into an election. In the past month, though, there are signs that any growth we were experiencing has potentially stalled.
The newest weekly initial unemployment claims was 388,000. The four week average for initial claims has increased for three weeks straight and is now the highest it has been this year. Initial claims had been pretty much trending downward steadily for almost a year but it looks as if that trend may have stopped. In addition, Gallup had found economic confidence had been trending steadily upward since October, but in the past month it has remained basically flat.
Although a few data points do not make a trend, there are some potential worrying signs. Recent statements by the Federal Reserve make it clear they are not going to take action at this time to try to boast unemployment. In addition, with Europe slipping back into recession because of their misguided obsession with austerity, the United States can’t expect them to provide any much needed boost to our own economy.
While the news has been recently flooded with a huge number of horse race polls, seven months out from the election I would recommend paying more attention to the job numbers than the poll numbers. Overwhelmingly, the top issue for Americans is jobs/economy and the voters will judge Obama on how he seems to have handled that issue.