Just when the headline news about the economy was beginning to look good and the talking heads were beginning to sound good, along came a barrage of bad news that was so bad that it couldn’t be covered up. Gallup began with the news that in January nearly 20 percent of the U.S. workforce “lacked adequate employment”, which was worse than the numbers reported by the Labor Department. According to Reuters, these “findings appear to paint a darker employment picture than official U.S. data,” with about 30 million Americans “underemployed.” And Gallup misses the mark by at least 2 percent, according to John Williams of ShadowStats.com.
“Core consumer prices” fell by a monthly 0.1 percent in January, reported the Wall Street Journal on February 19, noting that the last time core consumer prices fell was in December 1982. However, noted the Journal, citing the U.S. Department of Labor’s statement, the seasonally adjusted consumer price index rose 0.2 percent during the same month, the increase caused mainly by higher energy prices.
"The art of economics," economist Henry Hazlitt wrote nearly seven decades ago, "consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups."
January’s unemployment numbers were released late last week. According to the official report, unemployment fell from 10.0 to 9.7 percent last month. Employment fell in such areas as construction and transportation, while we saw the now-familiar gains in such areas as services and retail.
Claims that cabals of “banksters” control much of the world’s economy from behind closed doors have, for years now, been mainstays of those usually dismissed as “conspiracy theorists.” But since Fall 2008, which saw billions funneled into banking and other institutions deemed “too big to fail,” and since hundreds of billions remain unaccounted for; and especially since the Federal Reserve has successfully resisted efforts to make its activities more transparent — especially its dealings with foreign banks — such claims have gained both visibility and at least some credibility.
According to Newsweek, the dollar isn’t weakening, and even if it is, it isn’t Obama’s fault. On Tuesday, Daniel Gross iterated all the reasons that, according to conservatives, the American dollar should weaken. Conservatives, he said, blame the actions of the Federal Reserve with the lowering of interest rates to zero, printing money, and expanding the monetary base. They also blame the Obama administration for running up huge deficits in its efforts to restart the faltering economy.
The evidence is mounting that the American economy is very far from being out of the woods. For one thing, the latest job reports show that 85,000 more jobs were lost during the month of December, leaving the shattered American economy with 7.2 million jobs fewer than in December 2007.
U.S. Treasury Secretary Timothy Geithner has some explaining to do. Both the New York Times and the British Telegraph have reported that e-mails going back to January 2009 show that the troubled insurance firm American International Group (AIG) received instructions from the New York branch of the Federal Reserve not to reveal certain details of bailout payments the company received courtesy of longsuffering American taxpayers.
The 60 percent gain in stocks since March was largely caused by secret government purchases of stock-index futures, the CEO of TrimTabs claims.
Where do the kinds of jobs that will grow the economy come from? Can the federal government simply create them through more spending? We are about to find out — yet again.