Unemployment Applications Surge to 429,000, GDP Growth Falls.

Today I filled up my car at $4.099 a gallon in Upstate New York. And as if we didn't need any more bad economic news, we now have some new figures coming out.

For the second time in three weeks, the number of people applying for unemployment benefits has jumped yet again-- well over the bellwether of 400,000 applicants. Now it has come to 429,000-- a bad sign for next week's April unemployment numbers.

Applications near 375,000 are consistent with sustained job creation. Applications peaked during the recession at 659,000.

Some economists predicted that auto factory shutdowns, stemming from supply disruptions in Japan, would cause applications to rise. But a Labor Department analyst said only one state reported auto-related layoffs and the increase was modest.

To make matters worse-- much worse, the GDP numbers have come in "unexpectedly" low. Economists the last few weeks were predicting about a 3.0% increase in the economy. Last quarter it was well below.

Part of the reason for the anemic 1.8% growth rate-- inflation! But expect it to continue:

The Federal Reserve on Wednesday acknowledged the slowdown in first-quarter growth, describing the recovery as proceeding at a "moderate pace"—a slight step back from a statement in March when it said the economy was on a "firmer footing."

It trimmed its growth estimate for 2011 to between 3.1 and 3.3 percent from a 3.4 to 3.9 percent January projection.

The U.S. central bank signaled it was in no rush to start withdrawing the massive monetary stimulus it has lent the economy. It confirmed plans to complete its $600 billion bond buying program in June.

Great... let's not drill for oil, throw another $500,000,000,000 into the inflation pool, et cetera, et cetera.

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