Taken out of context, statistics that seem to show improvement in some aspect of the economy may actually simply mask the fact that things are getting worse. In this regard consider the number released today showing new claims for unemployment insurance last week. It was 601,000, a huge number certainly, but the lowest weekly number in several months, indicating that companies may be laying off workers at a slower pace.

By itself this statistic seems like good news. In fact, it’s virtually meaningless.

The really important figure that came out today is that the total number of Americans collecting unemployment insurance is the highest in 25 years. This is because while layoffs may indeed be slowing, the number of people being hired is growing even more slowly. Thus, the total number of people out of work grows even as layoffs slow.

More people out of work means more foreclosures, more credit card defaults, more trouble for already troubled banks, less revenues for governments.

A stock market that focuses on fewer layoffs and ignores the fire-rehire ratio is missing the point. But then, for our currently overly exuberant stock market, that might be the real point.