It's Thursday ¯\_(ツ)_/¯

And initial and continuing claims fell, but there are some other indicators of trouble ahead.

Applications for US unemployment benefits fell last week, suggesting the labor market remains stable.

Initial claims decreased by 8,000 to 208,000 in the week ended July 11, according to Labor Department Data released Thursday. The median forecast in a Bloomberg survey of economists called for 217,000 applications.

Continuing claims, a proxy for the number of people receiving benefits, dropped to 1.81 million in the previous week, also lower than expected.

New filings have fallen back to historically subdued levels after spiking in May and early June. Meanwhile the jobless rate declined last month, adding to evidence that employers are generally holding onto their workers even though some sectors such as technology are shedding jobs

Meanwhile long term unemployment has become increasingly problematic.

By most key metrics, the U.S. labor market is in fine shape: the economy has added jobs for four straight months, much improved from late last year, and the unemployment rate has drifted down to 4.2%.

Yet nearly two million Americans have been locked out of the job market for at least half a year.

The long-term unemployed—people without work for 27 weeks or more, the longest period the Labor Department reports in each monthly jobs report—accounted for 27.3% of all unemployed people in June, up 4 percentage points from a year earlier.

That is hovering near the highest level since late 2021, when the labor market was recovering from the Covid-19 shock. This can be perilous, since the six-month mark is when many job seekers lose severance or unemployment benefits.

Also, we are seeing increasing signs of trouble in the housing market.

Pending home sales plunged by 5.4% in June from May, seasonally adjusted, to the lowest level for any June on record, down 0.3% from the abysmally low levels in June last year, down 36% from June 2021, 37% from June 2020, 34% from June 2019, 32% from June 2018, and down 20% from June 2011, during the Housing Bust, according to data from the National Association of Realtors. Its data only goes back to mid-2010.

This is now the fourth year that demand has been in the deep-freeze, amid the highest supply of existing single-family homes in 10 years and of existing condos in 14 years.

Pending home sales fell in all regions, with the index plunging by the most in the Midwest, plunging to record lows in the West, and plunging in the South to the lowest level for any June and the sixth-lowest for any month in the data’s history going back to mid-2010 (historic data via YCharts):

 I think that we are in for a world of hurt.