21 August 2009

More on Unemployment and its Repercussions

....“it is unlikely we will see meaningful reductions in the foreclosure and delinquency rates until the employment situation improves.” Mr Brinkmann expects the peak in foreclosures to lag the peak in unemployment by around 6 months. _FinancialTimes
Informed analysts are beginning to see unemployment as a leading indicator of things to come, as well as a lagging indicator. This makes their work much more difficult, and casts the US government's so far extravagantly ineffectual interventions in a much more tragicomic light.
The unemployment rate stood at 9.4 percent in July but is expected to peak above 10 percent. That means more foreclosures, which will put a drag on recovery.

"It will definitely slow down the housing market a bit, which will have a corollary effect on the overall economy coming back" to life, Sharga said. _McClatchy
Oh, it will do more than slow down the housing market a bit. The effect of unemployment-caused home foreclosures will reverberate throughout the financial sector and spill over to affect all other sectors dependent upon credit -- including the government.

An interesting article with plenty of accompanying charts to illustrate the problem.

More on housing market woes (via SimoleonSense)

Backers of Obama -- including most of the media and large numbers of big money speculators and investors -- are growing frantic at their Prince's inability to instantly solve economic problems which are increasingly built into the US welfare state. Obama merely promises to enlarge the welfare state, and to integrate even greater self-destruct mechanisms into the works. It is all he knows.

Others who are growing frantic include the oil barons of Russia, Iran, Venezuela, and other dictators who overextended themselves on credit -- based upon spring 2008 oil prices. These blood-on-their-hands gents have to have higher oil prices. But they are stuck between supply and demand. They have many options for cutting oil supply, but how can they crank up demand in a world of economic downturn? It is likely that as supply is artificially cut, oil importing economies will find substitutes for oil, and increase conservation -- as well as cut economic activity even more.

China is beginning to hurt from lack of export markets as well.

So we have all of these unlikely bedfellows who want to jump-start economic activity in the western economies, but don't quite know how to do it.

Well-connected speculators and media barons have been trying to push the market upward using hype and massive denial. Watch the price of oil trying to reach its target of $100 a barrel. Oil supplies have been slowly choked, by dictators and the Obama / Pelosi reich. Pundits have been talking up the price of oil for many weeks now, with very slow progress to show for it.

The US has a government that doesn't understand the very basics of solid economic prosperity. It only understands bubbles and facades. Consequently, bubbles and facades are what the government has in mind, to serve the public. Government enablers, who stand to profit from the grand-scale scam, stand in line to assist in the deception.

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Blogger Bruce Hall said...

From FT.com:

"Bernanke cautiously optimistic on growth

By Krishna Guha in Jackson Hole

Published: August 21 2009 15:32 | Last updated: August 21 2009 21:45

The global economy seems about to start to grow again, Ben Bernanke said on Friday, declaring that vigorous actions by the world’s central banks and governments had succeeded in averting economic catastrophe.

“Prospects for a return to growth in the near term appear good,” the Federal Reserve chairman told told central bankers at their annual retreat in Jackson Hole, Wyoming.

However, European Central Bank president Jean-Claude Trichet said at the same symposium that talk of economic conditions’ returning to normal made him “a little bit uneasy”."

Yes... but...however... maybe....

Saturday, 22 August, 2009  
Blogger al fin said...

This economy is not growing from the bottom up. It is being pushed from the top-down by government stimulus and speculative raids.

Meanwhile true unemployment is above 15% and rising.

Pundits gripe about consumers not spending. But those credit cards are maxed out and new credit can be hard to come by if you are unemployed.

Government policies are choking off new business formation, and killing off previously profitable businesses in multiple sectors.

This is a good time to be alive if you are collecting multiple government pensions and lifetime benefits. Otherwise, you might have to grimace at all the premature pronouncements of the end to the recession.

Monday, 24 August, 2009  
Anonymous Anonymous said...

The US has a government that doesn't understand the very basics of solid economic prosperity. It only understands bubbles and facades.

All peoples get the government they deserve, and therefore we can conclude that this applies to the US population.

Second, my mother worked for one of the useless state regulatory agencies here in AZ and she was paid $10/hour when she topped out, had to pay a really large part of the cost of her benefits and had a retirement program that consisted entirely of voluntary savings. DMV employees make the same wages locally, which might explain why the state allows third party DMV services here in AZ.

Monday, 31 August, 2009  

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“During times of universal deceit, telling the truth becomes a revolutionary act” _George Orwell

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