Friday, August 2, 2013

The Big Myth: The Economic Recovery

Report: The Economy Is Just One Speech Away From Recovery...The Onion

  • "Anyone over the age of 14, knows this. If you want to look tall, stand next to a short person." John Crudele, NY Post
  • The unemployment rate fell to 7.4% last month. When low information voters reads those headlines today, they might think the economy---regarding employment---is improving. But then there's the rest of the story, the story the administration and democrats don't want you to know.
  • Let's put it in perspective. The economy only added 162,000 jobs last month, the lowest month since last March. It gets worse. The reason the unemployment number fell, as it has for some months now, is because people are dropping out of the labor force. In fact, 37,000 dropped out last month. Most of the jobs created last month were in low wage jobs as in retail and restaurants. Those two sectors accounted for approximately 85,000 jobs. None of this should be encouraging.  The fact is we need to create double this number of jobs for many, many months to proclaim the jobs environment is really improving.
  • Let's put this in historical perspective. Ronald Reagan created more jobs in one month than Obama has all year. In September of 1983, the Reagan administration created 1.1 million jobs. In fact, in the following 15 months job creation under Reagan ranged from 275,000 per month to 479,000 (Breitbart). That's real job growth.
  • Zero Hedge also placed Obama's jobs economy in perspective. Of the 953,000 jobs the Obama administration created, 77% were part-time jobs.
  • And let's look at the overall economy. It grew by a "whopping" 1.8% in the first quarter. Many in the presstitute media were spinning that as a "brisk" economy. In fact, most of the growth as been in the 2.4% range. I refer you to Crudele's quote above. If you want to look tall, stand next to a short person. Even Tom Cruise knows that. Most economists will tell you that we need an economic growth rate of at least 3% annualized to get out of this hole.
  • How is this economy affecting young people. We've known that 1 in 2 college grads cannot find work or at least work commiserate with their degrees. Pew Research reported this week that a record 21 million young adults are now living with their parents (and many of their parents are not doing well either). In addition to being unable to find a decent paying job, they can't afford to pay rent and their college loans at the same time.

  • But with all of this bad news, where is the economy doing well? There appears to be growth in inventories, residential investment and personal consumption expenditures. These are largely due to the Stock Market and the rise in housing prices in addition to the American consumer spending more. Bureau of Economic Analysis.
  • The bottom line: don't believe the claims of an improving economy just yet. It has a way to go.