CHESSNOID

I think we have all seen how bad the recent unemployment rate was.  The media was on that number of national unemployment of  9.4% and was trying to spin a positive on the lower number of jobs lost of only 345,000 which we all know will be adjusted upwards later on.  I do think it is good emotionally to try to stay focused on the positive of everything, but that should be balanced with a dose of reality.  Ignoring the real problems of the economy will not allow us to solve the issues if you refuse there is a problem.

How bad is the unemployment?  There is a good article at CNN.Money that has insightful numbers that is a better reflection of the jobs out there.  CNN.Money:

To get a more comprehensive snapshot of the labor picture you need to focus on the less well-known U-6 data set known as “alternative measures of labor utilization.” The U-6 includes folks counted in U-3 plus “ all marginally attached workers” as well as people who aren’t working full-time but wish they were (i.e., the underemployed.) Marginally employed covers “persons who currently are neither working nor looking for work but indicate that they want and are available for a job and have looked for work sometime in the recent past.”

And when you add up U-3 and all the underutilized workers the official U-6 rate for May 2009 is 16.4%. That’s an official BLS-generated stat that no one really wants to talk about: One out of every six members of the civilian labor force is either out of work or not fully employed. (And that doesn’t even account for the rising ranks of workers coping with furloughs.)

Okay, so exactly how bad is that from a historical perspective? Pretty bad. The BLS began reporting U-6 in 1994; in January 1994 the U-6 rate was 11.8% and then steadily declined before reaching an all-time low in October 2000 of 6.8%. During the ensuing recession/bear market U-6 peaked at 10.4% (Sept 2003) until the credit crisis took hold in 2008. The U-6 rate hit 10.9% in August 2009 August 2008 and has been on a rapid climb ever since; over the past year it has shot from 9.8% to today’s 16.4%. It sure makes it hard to buy into the green shoots theory just yet.

The housing market has not bottomed out nor has the mortgage delinquency issues been resolved. There are more problems with the new wave of foreclosures on the horizon in an already crushed housing market. The bailing out of banks, insurers, and auto companies with trillions of tax payer dollars has been just wasteful spending. We did not see any new jobs created nor has it resolved the housing crisis.

As far as the stimulus bill of $787 billion that was passed earlier this year, it has not worked and the numbers in unemployment have already surpassed the predictions of Obama’s advisers.  These advisers are smart people but simply wrong in their assessments. Unfortunately, it is the population that has to pay for its errors in judgment.

Washington Times:

The Bureau of Labor Statistics announced Friday that May’s unemployment rate soared to 9.4 percent. Once again, Obama administration predictions on the economic impact of the $787 billion stimulus plan have proved wrong.

On Feb. 4, Christina Romer, chairman of the President’s Council of Economic Advisers, warned: “If we fail to act [and don't pass the stimulus], we are likely to lose millions more jobs, and the unemployment rate could reach double digits.” White House economic adviser Lawrence H. Summers told Americans that the stimulus would start improving the economy “within weeks” of passage.

After the stimulus bill was signed into law on Feb. 17, the Obama administration predicted that the unemployment rate this year would average just 8.1 percent. Even as late as May 11, Ms. Romer didn’t think the unemployment rate would reach 9.5 percent until December.

Every speech I now hear from Obama and his administration is about how bad it is and how much worse it will get. The numbers that come out month after month with poor results seem to have the stopped the speeches of change and hope. The numbers seem to emphasize an administration continuing the poor performance of the previous Bush administration.