Monday, March 07, 2011

ECONOMIC UPDATE

"With a little more money in their wallets and a little less fear in their hearts, American consumers helped pull the economy up by its bootstraps in the final months of last year."
-Catherine Rampell, New York Times

Job Market
There's mixed news in the economy. First, the good news: America's official unemployment has dropped below 9% for the first time since President Obama took office. 8.9% is still awfu8l, but at least its moving slightly in the right direction. In other unemployment news, the initial unemployment claims are down as well, down to 368,000 which is the lowest level we've seen since April 2008. What that means isn't exactly clear; unemployment claims have been steadily dropping for eight months now, but that doesn't mean people are finding jobs necessarily.

There are a lot of reasons people might not be claiming unemployment, such as we're reaching an equilibrium of the maximum number of people who will lose their jobs, or of people who qualify for unemployment (getting scattered part-time and temporary jobs won't qualify you for unemployment when they run out, for instance).

Meanwhile, once again, the Obama administration released growth numbers for the country, then quietly "revised" them a few weeks later... to be less. And get this, the Associated Press claims that its spending cuts by states that caused the sluggish growth. Keynes, much?
The Commerce Department reported Friday that economic growth increased at an annual rate of 2.8 percent in the final quarter of last year. That was down from the initial estimate of 3.2 percent.

The weaker figure was disappointing and prompted some economists to lower their forecasts for economic growth in the current January-March quarter.

State and local governments, wrestling with budget shortfalls, cut spending at a 2.4 percent pace. That was much deeper than the 0.9 percent annualized cut first estimated and was the most since the start of 2010.
The New York Times ran an upbeat article about how people were spending more and getting back on their feet when the 3.2% report was released. The adjusted number? Crickets.

Its been every single quarter in the Obama administration now that they've given us bogus, inflated numbers then quietly reduced them which doesn't get reported as much as the initial claim. Once or twice I could buy as an error but every time?

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