Projecting (Even) Higher Unemployment

These days it seems  like nobody really understands the state of the economy and government is just throwing random legislation out to see which one sticks. But all they are really doing is spending our future generation into an early grave.

Think about it, our current administration told us that we need to spend spend spend in order to save save save our economy. Of course, nobody in their right mind would spend their own money now that:

1. stocks/401Ks have on average lost more than 40% of their value
2. one in four houses are underwater as prices continue to plummet
3. foreclosures and short sales are on the rise
4. Alt-A and Option ARM loans crisis is escalating
5. unemployment rates have continued to climb
6. credit is significantly harder to obtain

Never mind the fact that spending money we don’t have was exactly what got us into this whole mess. So what does our current administration do instead? Brilliantly they decide that if you don’t spend it then we’ll spend it for you! So they go to their little printing presses and print out hundreds of billions of dollars. Of course that is just figuratively. These days you don’t actually need to print anything; with electronic transfers there really isn’t a difference between $100 and $1,000,000. It’s just a couple of zeros on the end (what is that? less than 3 bytes I think).

So our administration promised us that if they spend, they will come… I mean our economy will be saved, unemployment rate will stay steady, and the stock market will magically rise. Well I don’t know whether the stock market is okay now, but its volatily certainly has not subsided (+100/-200 changes daily cannot be healthy for anybody’s portfolio). What I do know is that our economy is no better off and the unemployment rate definitely has gone to hell.

The administration told the public that if all of their legislation was passed quickly (and with barely any scrutiny), unemployment would not go higher than 8 percent. Well, just a few months down the road the unemployment rate has skyrocketed past 8 percent and is now nearing 10 percent (in California it is already past 10 percent). They need to admit that they were wrong and don’t know what the heck they’re talking about. Though any good that does, the money has already been spent. Hundreds of billions of dollars spent and hardly anything to show for it. Except impending inflation that is.

Even worse, now Mark Zandi, the chief economist for Moody’s Economy.com says “Unemployment won’t peak until this time next year, and then it will remain very high through next year. It won’t get back to full employment until 2013 or 2014.” So you’re saying that we haven’t even hit the peak of unemployment yet? Good to know. I just hope that they got it right this time and won’t be revising the numbers again in another few months. I mean, if these highly educated people don’t even know if they got their numbers right then what hope do we common folk have?

Related posts:

• Will the Real Unemployment Rate Please Stand Up?
• Feds Sure Can Save
• California, You Used to be Cool
• Review of Meltdown