Letting your boss know you are looking for a new job

Hello everyone! I was told recently that one of my managers should be told when an employee is seriously looking for a new job. This manager "doesn't care" when someone is looking, but wants to know about it. Is that the norm? Or is that more of the exception?

To me, it seems like that would be bad idea from the employee's perspective. You run the risk of getting cut out of the loop, lose any hope of advancement, and if layoffs come around, you would be the first getting the ax.

Does anyone else have (or had) a manager like this? Other thoughts?