“We tolerate no dissent. That part of the Constitution is gone, along with the rest of it.”
Over the last several years I have watched the rise of an important new intellect on the American scene. Ron Unz, publisher of The American Conservative, has demonstrated time and again the extraordinary ability to reexamine settled issues and show that the accepted conclusion was incorrect.
One of his early achievements was to dispose of the myth of immigrant crime by demonstrating that “Hispanics have approximately the same crime rates as whites of the same age and gender.” You can imagine the uproar, but Unz won the debate. Read more
In America Everything is Hype for a Buck
Dave Kranzler of Golden Returns Capital declares the April payroll jobs report that was released on May 3 by the Bureau of Labor Statistics to be “fictitious.”
Statistician John Williams (shadowstats.com) says both the jobs report and unemployment rate are “nonsense.”
I agree with both. But don’t expect the financial press to report the facts.
Let’s take a walk through the BLS report and you can arrive at your own conclusion.
The BLS report says that the private sector created 185,000 service jobs in April. Even if this report were true, it would have negligible effect on the unemployment rate as about 127,000 new jobs are needed each month just to stay even with population growth and current unemployment rate. Read more
“The corrupt corporations, the corrupt media, and the corrupt US government have insulated the country from truth”
Over a decade during which the US economy was decimated by jobs offshoring, economists and other PR shills for offshoring corporations said that the US did not need the millions of lost manufacturing jobs and should be glad that the “dirty fingernail” jobs were gone.
America, we were told, was moving upscale. Our new role in the world economy was to innovate and develop the new products that the dirty fingernail economies would produce. The money was in the innovation, they said, not in the simple task of production.
As I consistently warned, the “high-wage service economy based on imagination and ingenuity” that Harvard professor and offshoring advocate Michael Porter promised us as our reward for giving up dirty fingernail jobs was a figment of Porter’s imagination. Read more
“The Fed has produced a perfect storm that could consume the US and perhaps the entire Western world”
According to the Bureau of Labor Statistics, the US economy created 236,000 new jobs in February. If you believe that, I have a bridge in Brooklyn that I’ll let you have at a good price.
Where are these alleged jobs? The BLS says 48,000 were created in construction. That is possible, considering that revenue-starved real estate developers are misreading the housing situation.
Then there are 23,700 new jobs in retail trade, which is hard to believe considering the absence of consumer income growth and the empty parking lots at shopping malls. Read more
“Sooner or later something will pop these bubbles … and the consequences will be horrendous.”
Officially, since June 2009 the US economy has been undergoing an economic recovery from the December 2007 recession. But where is this recovery? I cannot find it, and neither can millions of unemployed Americans.
The recovery exists only in the official measure of real GDP, which is deflated by an understated measure of inflation, and in the U.3 measure of the unemployment rate, which is declining because it does not count discouraged job seekers who have given up looking for a job.
No other data series indicates an economic recovery. Neither real retail sales nor housing starts, consumer confidence, payroll employment, or average weekly earnings indicate economic recovery. Read more
“Americans were told a packet of lies designed to win their gullible acceptance to an economy that produces high returns for Wall Street, shareholders, and corporate executives at the expense of everyone else in the country.”
In November the largest chunk of new jobs came from retail and wholesale trade. Businesses gearing up for Christmas sales added 65,700 jobs or 45% of November’s 146,000 jobs gain. With December sales a disappointment, these jobs are likely to reverse when the January payroll jobs report comes out in February. Family Dollar Stores CEO Howard Levine told analysts that his company’s customers were unable to afford toys this holiday season and focused instead on basic needs such as food. Levine said that his customers “clearly don’t have as much for discretionary purchases as they once did.”
For December’s new jobs we return to the old standbys: health care and social assistance and waitresses and bartenders. These four classifications accounted for 93,000 of December’s new jobs, 60% of the 155,000 jobs. Read more
If the “free and democratic” Americans cannot even find out what the unemployment rate is, how do they expect to find out about anything?
Statistician John Williams (shadowstats.com) calls the government’s latest jobs and unemployment reports “nonsense numbers.”
There are a number of ongoing problems with the released numbers. For example, the concurrent-seasonal factor adjustments are unstable. The birth-death model adds non-existent jobs each month that are then taken out in the annual downward benchmark revisions. Williams calculates that the job overstatement through November averages 45,000 monthly. In other words, employment gains during 2012 have been overstated by about 500,000 jobs. Another problem is that each month’s jobs number is boosted by downside revision of the previous month’s jobs number. Williams reports that the 146,000 new jobs reported for November “was after a significant downside revision to October’s reporting. Net of prior-period revisions, November’s seasonally-adjusted monthly gain was 97,000.”
Even if we believe the government that 146,000 new jobs materialized during November, that is the amount necessary to stay even with population growth and therefore could not be responsible for reducing the unemployment rate from 7.9% to 7.7%. The reduction is due to how the unemployed are counted. Read more
“A country so poorly led can do nothing but decline.”
During the second half of the 20th century the United States was an opportunity society. The ladders of upward mobility were plentiful, and the middle class expanded. Incomes rose, and ordinary people were able to achieve old-age security.
In the 21st century the opportunity society has disappeared. Middle class jobs are scarce. Indeed, jobs of any kind are scarce. To stay even with population growth from 2002 through 2011, the economy needed about 14 million new jobs. However, at the end of 2011 there were only 1 million more jobs than in 2002. http://www.bls.gov/webapps/legacy/cesbtab1.htm
Only 426,000 of these jobs are in the private sector. The bulk of the net new jobs consist of waitresses and bartenders and health care and social assistance. According to the Bureau of Labor Statistics, over the 9 years, employment for waitresses and bartenders increased by 1,188,000. Employment in health care and social assistance increased 3,087,000. These two categories accounted for 1,000% of the net private sector job growth.
As for manufacturing jobs, they not only did not grow with the population but declined absolutely. During these nine years, 3.5 million middle class manufacturing jobs were lost.
Over the entire nine years, only 48,000 new jobs were created for architects and engineers.
In the 21st century the US economy has been able to create only a few new jobs and these are in lowly paid domestic services that cannot be offshored, such as waitresses and bartenders. Read more
Where to Blame the Crack-up in Jobs Growth?
Last week, Edward Lazear wrote an op-ed in the Wall Street Journal with the uplifting title “The Worst Economic Recovery in History.” Lazear noted that many people have referred to our latest recession as the worst recession since the Great Depression. He then proceeded to make the case that, while we may technically be in an economic recovery, our current recovery is not only the worst since World War II, it is even worse than the recovery in the Great Depression.
That’s a tough one to beat. According to Federal Reserve data, it took 88 months (about 7 years) for industrial production in the United States to muddle through the Great Depression and get back to its previous peak level in August 1929. We’ve only had 51 months since the December 2007 peak in industrial production before our latest recession, and we still aren’t back to that December 2007 peak yet. This is bad, to be sure, but on this basis it’s hard to say our latest recovery is “even worse” than the slow one after the Great Depression, because we just haven’t had the time yet.
But Lazear was making his case in terms of growth rates during the recovery. On that basis, in the 32 months since the latest economic “trough,” industrial production growth has averaged 0.4% per month. This is about one-third the average growth rate in the 32 months following the March 1933 trough at the bottom of the Great Depression. Read more
The Audit of Federal Reserve Governance: Wiggle Room for the GAO?
We’ve recently endured the worst financial and economic crisis since the Great Depression, and for many people, it isn’t over yet. We’ve had 11 recessions since World War II, and our latest included the largest decline in employment of all of them. It has also been by far the worst jobs ‘recovery’ despite that fact that it was also the worst recession. Hard recessions are typically followed by relatively rapid recoveries, but that hasn’t been the case this time. Total nonfarm payroll employment in the U.S. remains 7 million jobs below where it was at the time the recession started – over 40 months ago.
During the latest downturn, the national unemployment rate went from about 4.5% to 10%, and remains above 9% at the latest reading. A recovery has been underway over the last year and a half, led, until recently anyway, by the manufacturing sector. But the jobs picture has remained very bleak. Since 1960, we never had a three-year interval where U.S. private sector employment fell at an average annual rate over 1%. In 2009, that happened for the first time since the Great Depression, and again in 2010.
As the financial crisis was gathering steam in 2008, and as millions of people were losing their jobs, the Federal Reserve lent extraordinarily large amounts of money to large financial institutions. The assistance was provided to banks as well as other parties not normally able to access central bank credit directly, including American International Group (AIG), one of the largest insurance enterprises in the world. Loans to nonbanks arose under provisions in Section 13(3) of the Federal Reserve Act that allow the Fed to lend to ‘individuals, partnerships, and corporations,’ e.g., not just banks, in ‘unusual and exigent circumstances.’ The Fed’s emergency lending also included huge loans for foreign financial institutions. The Fed extended over $1 trillion in emergency credit, at peak levels. And the Fed’s balance sheet also mushroomed as it embarked on a buying spree of ‘mortgage-backed’ and other securities. Read more
