recession

by

How Many Americans Are Truly Unemployed?


During the years 1929 to 1935 as many of 25% of America’s able working public was unemployed.  How did they get that number?  Simple, if you did not have a regular full-time job, you were unemployed.

That, however, is not how we do it today.  Today’s figures are gathered entirely from America’s who are receiving an unemployment check.  It does not include the homeless, who were counted in 1933; the chronically unemployed, who also were counted in 1933; or farm workers, who were counted in 1933.  Why then, you ask, are we not counting those people now?  The simple, and most truthful answer, it is not convenient.  You see, if we did count those people we would have to acknowledge an unemployment rate of well about 15% and that, regardless of what they say, is something neither political party is prepared to cope with.

When John Glenn went into space the first time, the heat shield of his capsule malfunctioned and there was worry that he would burn-up upon re-entry into the atmosphere.  NASA leadership haggled over what to do when one of Glenn’s fellow astronauts told them that they had an obligation to inform Glenn of the condition of his ship, and that Glenn, being the outstanding pilot his was, would assist in the decisions that needed to be made.

The United States is owned by the people, not but 535 congressmen and senators.  The people have a guaranteed right to assist in decisions made for them.  That, however, is difficult to do when complete information is denied them.  The American people do not know the condition of their ship, although Congress probably does, or should.  They forget, it seems, that they are servants and not masters, although it seems they believe they are the latter.

The good ship United States is mired in a recession, the stubbornness of which is confounding, but the magnitude of which is being kept from the general public by those in whom is held the public trust.  A person who is chronically unemployed or who has quit looking is not necessarily unemployable.  But when their own government stops counting them then they are right to feel neglected by their own government.  Those people have not given up a single right to which they are entitled and which the Constitution gives them guarantee.  But their government, our government, through statistical trickery, has rendered them unworthy of its time.  Who, I ask, gave them permission to do so?

I recommend, and I know this will be wildly unpopular with my more conservative friends, that any person who is unemployed be given an unemployment check for however long that unemployment lasts.  Then we will be forced as a country to look at all our citizens, without exception, and deal with the entire problem and not just that portion of it that suits us.

by

America’s Next Recession Starts March 1


The Dow-Jones today topped the 13,000 mark for the first time since 2008.  That is a fact.   How, then, can I possibly be predicting a recession starting in a little over a week?  The stock market is one of the worst indicators of the future.  On March 9, 1929 the Dow Jones average was 381.70 but by the end of October in 1929 it had fallen to 198.69.  The market lost 48% of its total value, most of that happening in October 1929.  President Hoover looked at the economy he presided over in March 1929 and said that the warnings of upcoming trouble were worthless.

People are going to look at today’s stock closing optimistically.  But they need to look at a single indicator that directly feeds into imminent economic trouble.  Crude oil prices have risen over 30% since September 2011 and show no signs of retreating.  To the contrary, they show every sign of rising to historic levels.  The average person thinks of such a rise only with regard to what they pay for gasoline at the pump.  But all forms of transportation are equally affected.  This means the price of food, durable goods, clothing, and everything else goes up as well if only because they too have to be transported and that cost is reflected in the price of the item being sold.

But have you ever considered how much of everything in your life is petroleum-based?  Consider that everything that is made from plastic is petroleum-based.  That alone should give one pause to consider what rising crude prices mean.  Petroleum is also used in medicines, clothing, and construction.

I believe crude oil prices are going to keep going up because of the continued unrest in the middle east.  Lybia, Egypt, Syria, Iran, and Iraq are all in a more or less unstable condition.  And all are oil-producing countries.  Adding to this unrest are both Afghanistan and Pakistan, neither oil producers, but both home to radical Islamists who have every intention of continuing or raising the level of unrest in all the countries mentioned.

In today’s world economy energy drives those economies.  Whatever is happening to the price and distribution of oil affects all economies to one degree or another.  It is like throwing a rock in the middle of a calm pond.  The waves that rock creates moves outward in all directions, and the bigger the rock, the bigger the waves.  Right now we are feeling the waves of uncertainty in the market.  Consider that most countries in the world produce no oil at all, and two that do, the United States and China, both in the top 20 oil producers, export none of the oil they produce and import even more.  China will benefit from Iran’s decision to stop sending oil to England but of course England will suffer.  And so the rock Iran threw in England’s water will send its waves throughout Europe.

The unrest in the middle east is unlikely to settle down any time soon.  That means the market jitters are likely to continue as well.  That of course means oil prices will remain high with a high likelihood of their going ever higher.  I think it likely that the average price per gallon of gasoline will be at or close to $5 by summer’s end.  People will, of course, cut back on their purchases and with that the economy takes a hit, probably a big on.