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The Perils of the Second Derivative
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One of the alleged "green shoots" perking up the economy was that unemployment was getting worse more slowly. Economic and financial journalists have been calling this the "second derivative" argument: measuring the state of the economy by the rate of change in the rate of change. There's something to this, but not as much as was made out of it--if unemployment continues to grow more slowly for another two years, that's still bad news.
Then, of course, how are you supposed to feel when the initial jobless claims figures start going back up, as they did this week? I'm more inclined to credit jobless students flooding the market than some disastrous turn in our economy's fortunes. But then, I was never that cheered by the second derivative in the first place. I'll feel cheerful when the unemployment figures start going down.
Then, of course, how are you supposed to feel when the initial jobless claims figures start going back up, as they did this week? I'm more inclined to credit jobless students flooding the market than some disastrous turn in our economy's fortunes. But then, I was never that cheered by the second derivative in the first place. I'll feel cheerful when the unemployment figures start going down.
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