Archive for December, 2009

Hmmmm……read it here.

Not really sure what is really mean by this headline, because it is the truth in some ways, and in some ways it is not.

In 2007 the unemployment rate started at 4.6% and ended at 4.9% in December.  So far for 2009 we started at 7.6% and are at 10.0% in November.  As far as yearly rate changes in one year, if I use November’s number as the end of year number then 2009 ranked as the highest change since 1948.

Between 1948 and 2009 the highest change from December to January was an increase of 2.3 percent in the unemployment rate, once in 1948, the other in 2008.  In 2009 we saw a 2.4 percent change.  So in that regard it is the best news since 2007, since 2008 was at 2.3 percent.

Bad news is there has not been one occurrence since 1948 of the unemployment rate increase by this much two years running. 

From October 2009 to November 2009 our unemployment rate dropped by .2%.  Now if we compare numbers from October to November since 1948 here is what we come up with.

• 45% of the time the Unemployment Rate dropped from October to November
• 39% of the time the Unemployment Rate increased from October to November
• 16% of the time there was no change.
• On the years that the Unemployment rate dropped it dropped on average of .23%.
• On the years that the Unemployment rate increased it increased by .25%

So really, the reduction in job loss from October to November is less of an achievement, but more of a statistical thing.  In essence there was a 45% chance that the unemployment rate would drop by .23% between October and November.

In the defense of the numbers, this is only the second month this year that the unemployment rate decreased, so that is good news.

So though there is some decrease in unemployment, the jury is still out on if the policies in place had a play in it or not.  We do still have a long hard road ahead of us, that is for sure.

So in conclusion, this was the best report since 2007, however it is not a sign that we have entered a turning point.  The months to come will be proof if this is good or not.

So now we need to put people back to work, but we do not have the money to do that.  So they are after the bail out money that is left.  This article on The Huffington Post describes what is being attempted now.

This is plan on the surface has merit, at least it is not an additional cost and the attempt is to use existing monies that I assume are not going to be used to help fund this.  Or will we see another initiative in four to six months needed more cash for the bailout fund because they ran out of money?  Even Obama stated, “It is not going to be possible for us to have a huge second stimulus, because frankly, we just don’t have the money."  So do we have the money for health care reform?  I bet we do, I bet the Obama Administration is making sure we can still secure funds for that.

Many critics have accused the Economic Stimulus Package of being weak on job growth, which I agree with, though the Obama administration was just a month ago claiming it was a great success and they are on track to stimulate more jobs.  So why this sudden change of focus?  Could it be because the unemployment numbers are about ready to come out.

Obama spoke a day before the Labor Department was to report unemployment figures for November. The October jobless level soared into double digits to 10.2 percent, and forecasters don’t expect the November figures to be any better – and they could even be worse.

Maybe if President Obama had not spent the last few months consuming so much energy on Health Care we would be in a better position.  He went from economic stimulus, to health care, to Afghanistan, and the whole time claiming the Economic Stimulus was working.  Now that it is apparent it is not, or at least at a pace to stave off the fears of the American public, now we go back to fixing the economy.

President Franklin Roosevelt during the Great Depression of the 1930’s kept his focus on bringing our country back together.  His plan was simple, get people back to work.  He stayed focused on that plan.  He did not wonder off spending more money some where else, he was not that fiscally irresponsible.  Even with all his efforts the Great Depression held its grip until the start of World War II.   That was over 10 years.  World War II created more jobs than Roosevelt or Obama could ever create.

So my question is, if we needed World War II to bring us out of the Great Depression with FOCUS on jobs growth, then how do we expect to get out this problem easily when it took close to a year from the point we recognized the problem to focusing on job growth.  In the meantime we spent more and more money, so much so, that we really don’t have the cash to fix the problem any more.  We have to rob Peter to pay Paul, kind of like a Ponzi scheme.

Crusing the web today, I saw an article about a White House summit on ideas to aid in job growth.  The first thought that entered my head was, “Wasn’t that what the economic stimulus was about?”  After all, there were article after article a few weeks back about the number of jobs it created.

One of first lines in the article spoke about the health care bill, and then it struck me.

Between bail outs, the Economic Stimulus, and the proposed health care, how much money are we potentially spending here?

Then I found this article located here, with the graph below.

If this graph is even partially right, we are in some serious trouble.  The record deficit that happened during President Bush’s office in 2008 will be nothing compared to the future.

It is unclear if this includes health care or not, the article does not specifically mention it, so likely not.  And of course things have likely changed some since this article was posted, but something tells me it is not much better.