On The Money — Jobless claims creep higher

by Sylvan Lane, Aris Folley and Karl Evers-Hillstrom - 07/21/22 7:00 PM ET

Layoffs are still fairly low, but the steady rise in jobless claims may be a sign of a slowing economy. We’ll also look at the introduction of a cannabis legalization bill and daunting news about the housing market.

But first, Kylie Jenner is in trouble over her private jet.

Welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. For The Hill, we’re Sylvan Lane, Aris Folley and Karl Evers-Hillstrom. Subscribe here.

Jobless claims rise to highest level since November

New applications for jobless benefits rose to the highest weekly level since November last week, according to data released Thursday by the Labor Department.

In the week ending Saturday, initial claims for unemployment insurance rose to 251,000 after seasonal adjustments, up by 7,000 from the previous week’s total of 244,000.
The average weekly number of claims over the past four weeks rose by 4,500 to 240,500.

“The labor market is softening but the change is so far gradual. The U.S. economy is cooling but is probably not in recession in July,” said Bill Adams, chief economist for Comerica Bank, in a Thursday analysis.

“Between economic data and news reports, it’s clear that job losses are underway in the tech, mortgage finance, real estate brokerage, and big box retail sectors.”

The context: While the increase in jobless claims was relatively small, it marked yet another week of rising layoffs amid deepening concerns about the strength of the economy. Weekly claims have jumped from a low of roughly 160,000 in mid-March by nearly 100,000 new applications per week.

Sylvan breaks it down here.

LEADING THE DAY

Senate Democrats roll out long-awaited bill to legalize marijuana

Senate Democrats on Thursday unveiled long-awaited legislation to end the federal prohibition of marijuana, but opposition from Republicans and some Democrats is expected to pose a challenge to passing the measure.

Senate Majority Leader Charles Schumer (D-N.Y.) announced the bill, dubbed the Cannabis Administration and Opportunity Act, in floor remarks on early Thursday, lauding the legislation’s introduction as “historic.”

Schumer worked alongside Sens. Cory Booker (D-N.J.) and Ron Wyden (D-Ore.) to craft the legislation after the three released a draft plan last year for public feedback. Schumer said the senators have received more than 1,800 public comments and worked with “numerous Senate committees to improve the bill.”
Schumer said the bill would legalize cannabis by removing the drug from the Controlled Substances Act and “empowering states to create their own cannabis laws instead.” He said the bill also includes measures aimed at expunging federal criminal records of those “with convictions for non-violent cannabis offenses,” allows “those in federal prison for nonviolent cannabis offenses to appeal their sentences” and sets up a fund “to reinvest in communities that have been devastated by the war on drugs.”
But the newly introduced bill faces tough opposition from many Republicans in the evenly split Senate, as well as resistance from some Democrats, threatening its chances of passage in the upper chamber.

Aris has more here.

Homeownership slipping out of reach for many

New data is showing that homeownership is slipping out of reach for many Americans.

Rising home prices and mortgage rates above 5 percent are making houses less affordable in nearly every county in the country, according to real estate data company ATTOM.

“Median-priced single-family homes and condos are less affordable in the second quarter of 2022 compared to historical averages in 97 percent of counties across the nation with enough data to analyze. That was up from 69 percent of counties that were historically less affordable in 2021,” the company said in a Thursday statement summarizing their latest report.

The last time affordability metrics were this low was in 2007, just prior to the crash of the housing market in 2008, according to the report.
Home-ownership expenses now constitute 31.5 percent of wages and are rising at the fastest rate since at least 2000.

Tobias Burns has more here.

BUDGET REQUEST

President Biden will request $37 billion in the annual budget to go toward supporting law enforcement and for crime prevention, the White House announced on Thursday.

The Safer America Plan would invest nearly $13 billion over five years to hire and train 100,000 additional police officers, invest $3 billion to clear court backlogs and solve murders and establish a $15 billion grant program aimed at justice system reform.

Good to Know

Most Americans do not believe their current paycheck is enough to live on amid price hikes caused by inflation, a new poll found.

A recent Harris Poll conducted on behalf of the American Staffing Association found that around 58 percent of U.S. adults are concerned their paycheck won’t cover their own or their family’s needs — 20 percent plan to ask for a raise.

Here’s what else we have our eye on:

Tesla has sold off 75 percent of its holdings in Bitcoin, which was worth about $2 billion at the end of 2021, after making a huge investment in the cryptocurrency in 2021.
YouTube on Thursday said it will begin removing content that spreads misinformation about abortion safety or gives instructions for unsafe abortion procedures.
Sens. Elizabeth Warren (D-Mass.) and Ed Markey (D-Mass.) sent letters to four student surveillance programs Thursday asking if they flag search terms related to reproductive health, over concerns the data could be used to punish the students for seeking information about abortion access.

That’s it for today. Thanks for reading and check out The Hill’s Finance page for the latest news and coverage. We’ll see you tomorrow.

VIEW FULL VERSION HERE