The Blame Game: How Officials Explain Poor Data
Economic conditions. Unemployment. Retail sales. When it comes to these and other issues, will officials blame poor results on bad weather or worsening economies?
That's the question the "Fast Money" traders debated Thursday morning — the day ahead of the release U.S. GDP data for the fourth-quarter, and the day after U.K. officials blamed a cold December for their shrinking economy.
“People are going to point to the weather,” Tim Seymour, founder of EmergingMoney.com. “You can blame anything on the weather, apparently.”
U.S. officials already appeared to be following the U.K. in attributing economic weakness to the weather. On Wednesday, U.K. officials blamed frigid conditions for the 0.5 percent contraction in its GDP. The past December was Britain’s coldest month in more than a century.
On Thursday, U.S. officials suggested Mother Nature had a hand in a jump in unemployment filings. Initial jobless claims climbed a greater-than-expected 51,000 last week. The increase was the most in about three months. A Labor Department analyst told CNBC that snow-related shutdowns kept some from working in industries such as transportation, construction and education.
Seymour characterized the data as “obviously weak.”
How much of the jobless jump can truly be attributed to winter weather is unclear. A Labor Department analyst cautioned that, though snowstorms in the South and Northeast kept some from work, it's likely others were kept from filing for unemployment benefits. Closures at local government offices due to snowstorms have created backlogs.
Bad weather clouds economic conditions in other ways, as well. It keeps consumers from visiting retailers, potentially slowing sales in that sector and making consumer spending appear softer than it would otherwise be.
Any in-store weakness this December could be eclipsed by online strength if consumers simply shifted their purchases to online outlets. Traders were looking to Amazon’s earnings results, due out after Thursday's close, to shed more light on consumer behavior.
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CNBC.com with wires.