The only good news in the September unemployment numbers was that the market had sold off 203 points the day before on worries over these figures. So the drop Friday morning hasn’t been very steep so far.
But the numbers were bad, no doubt about it. How bad?
Let me count the ways.
1. The number of people collecting a paycheck fell by 263,000 for September.
2. That was much worse than the projected decline of just 175,000.
3. That quashes hopes, rising recently, that the economy would stop shedding jobs soon and might even start producing them by the end of 2009.
4. The unemployment rate declined 0.1 percentage points to 9.8%. Why is that bad news? Because the drop was caused by a big contraction in the workforce. With discouraged workers giving up the job hunt, the work force declined by571,000 in September.
5. If the work force had held steady in September, the unemployment rate would have increased to 10.2%, Briefing.com calculates.
6. Weekly hours worked fell by 0.1 hours to 33.0 hours. Companies are not hiring and they’re not giving those still working more hours. The hourly work week number has to go up before jobs can start to increase.
7. Government payrolls declined 53,000 largely on a decline in the number of state and local workers. Blame state budget cuts for that and those cuts are likely to keep on coming in the next few months as states and cities struggle to balance their budgets in the face of plunging tax revenues.
I simply don’t see anything good in this data.
terryw, I think we already have lost a decade, IMHO. Certainly in terms of stock gains, but in terms of jobs – I don’t know if we’ve got more jobs at this very moment than we did 10 years ago…
…..
Ugh, I can feel myself getting impatient with this market. It’s got to fall again… I think (I sold a pretty sizable percentage of my portfolio a couple months ago). Surprisingly, it just keeps going UP. But I’m not falling for that one again…
We’re fairly overvalued and we’re going to have a pretty long time till we climb out of this hole we’ve dug for ourselves.
I am just curious … Was it really a surprise?
We just tried to convince ourselves that the worst is over and did not look at the big picture. But, in reality, nothing has changed to make things better.
P.S. However, here is a bit of good news. Chicago lost its bid to host Olympic Games. Someone else has to go through the process of unnecessary spending for the honor of hosting those games.
(1) The equivalent of IT will be GT, GREEN TECH.
(2) China is catching up very fast even in IT and GT. China is already taking a quite lead in the GREEN TECH area both as producer and as user. While western countries are bashing China’s human rights and ridicles China’s cheap copy, China is making a real stride in their life and society. Pretty soon (it’s actually already happened) western countries have to learn how to PLEASE Chinese customers.
(3) Stimulus is a good idea if it’s handled by a competent and less corrupted government. When a government is swamped by lobbysts, you know where the money will go. Do I want to pay for those well corrected in term high tax and high inflation? No. The only way US can get out this this mess and regain its dominant power is GROWTH and LOW TAXES. Of course, “traffic cop and road signals” are need to ensure everyone follows rules and no piled ons.
(4) I have posted couple of times that “forget BRIC” and “India is over-rated”. Well, it seems some smart people began saying just that. One of them is Duetch Bank according to article I saw yesterday.
Have good day, everyone!
I honestly wouldn’t mind 10% inflation for a while if it helps us pay down our national debt. As much as BRIC would complain about it, it might be good for the job market and getting the economy rolling. Mr. Buffet has on several occasions suggested that we need another stimulus package. I just hope some new innovations on the horizon usher another age of progress like the IT boom in the late 1990s. As much as the US is on the path toward relative permanent decline in the next decades, we do still have the best innovations and entrepreneurial spirit. As great as China is doing right now, they are still mostly copying rather than innovating.
I think a lost decade might actually turnout to be an optimistic description of what’s still going on in Japan. The great fear of bankers like Greenspan and Bernanke is that a deflationary mindset will take hold with consumers and they’ll put off purchases today because they know stuff will be cheaper tomorrow. (Think of how that changes the game for the credit card industry. Why go into debt to make a purchase now when saving now and buying later means you’ll get it cheaper.) They believe that it’s extremely hard to break deflationary expectations once they’r in effect. Well, all the data says that they are in effect in Japan. Prices aren’t falling in most quarters but that’s deceptive since Japanese consumers are trading down. Buying a Coach bag instead of a Louis Vitton. Some of this is definitely demographic–Japan is the most rapidly aging economy in the world and people don’t have enough put away to pay for retirement. I’d agree. I’d sure like to avoid that slow slide downward.
I know I spend waaaaay to much time on this blog when I hit refresh every 3 min 😀
outch 🙁 I hope this does not turn into a replay of the lost decade in Japan