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Initial unemployment claims rose 22k last week to 496k from 474k the week prior (revised up 1k). Consequently, the 4-week rolling claims number rose 6k to 473.8k from 467.8k.

This latest print pushes claims squarely outside our 3 standard deviation channel. For reference, our channel reflects the trajectory that's been in place since the March 2009 peak in claims. While we had been hesitant to call a reversal in the underlying improvement trajectory, the fact is that six weeks of data do make for a trend. On the margin, this is clearly bearish for companies with direct consumer credit exposure.

CLAIMS ARE NOW CLEARLY GOING THE WRONG WAY - 1

Joshua Steiner, CFA

Managing Director, Financials