Unemployment drops? What!??!

Basically I've spent the past could of days stewing over the prospect of a rising unemployment rate and no real relief in sight due to a staggering economy. Then a funny thing happened...

WASHINGTON — A surprising drop in the November unemployment rate and in job losses cheered investors Friday and raised hopes for a sustained economic recovery.

The rate unexpectedly fell to 10 percent last month, from 10.2 percent in October, as employers cut the fewest number of jobs since the recession began. The better-than-expected figures provided a rare dose of good news for a labor market that's lost 7.2 million jobs in two years.

The average work week also rose, along with average earnings. And the Labor Department said 159,000 fewer jobs were lost in September and October than first reported.

How the hell did that happen? At least that's some good news going into the holiday season.

Obama doesn't have very many friends

At this point, I think soap scum is more popular than Barack Obama. Oh to be a President during the worst recession since the Great Depression. Wonderful.

President Obama's approval ratings hit their lowest ranking yet in the Rasmussen Reports daily tracking poll out Tuesday, with 27 percent strongly approving of the president's job performance and 42 percent strongly disapproving, an index rating of -15.

The president's total approval is 45 percent in the latest poll, which matches his lowest approval rating overall, compared to 54 percent disapproval.

Approval is strongly divided by party with 52 percent of Democrats strongly approving and 68 percent of Republicans strongly disapproving. However, Obama appears to be losing the critical independent vote with 16 percent of unaffiliated voters strongly approving and 33 percent of independent voters approving overall. Fifty-one percent of independents strongly disapprove.

Among the concerns for Americans are the war in Afghanistan, financial management and health care reform. Forty-five percent want the U.S. out of Afghanistan in a year, while 43 percent don't want a timetable.

Fifty-three percent of likely voters polled said they are worried the federal government is overmanaging the economy.

What I think are some hampering factors in Obama's administration includes the indecision during two unpopular wars, although the media has failed to report how things have seemingly improved in Iraq. Obama needs to take a stance on either leaving Afghanistan or digging in, not just standing pat. However, once he makes a decision on that, what does the United States do about Iraq? See the quagmire we're facing at the moment?

As far as the economy goes, that's somewhat out of Obama's control as most of the damage was not done on his clock. I don't know why so many Americans are quick to point a finger at him since (1) the president doesn't have a sweeping impact on the economy, he can pass legislation and use stimulus packages but in the end the market has to fix itself and (2) that stimulus package is actually popping up in everyone's life, I can't tell you how many times I've come across something that was funded by stimulus money. Certainly better than sending everyone a $300 check in the mail right?

My main gripe is the healthcare reform, as it hasn't been handled well and the Dems have seemingly taken the approach that "we need to do this, this is the best thing, the American people don't know what they're talking about, lets push this through." This sort of bull-rush that Obama and the Dems have been doing don't look good at all in the public eye.

Overall though, every president's approval ratings drop, so this is just business as usual.

Rocky road for employment

I know that technically we're bouncing back from the Great Recession, but New York Daily News Writer Nouriel Roubini thinks the worst is still to come for the American worker. The job market is always the last to improve when coming out of a recession and there's a good chance a lot of these jobs that were lost may never come back.

The last recession ended in November 2001, but job losses continued for more than a year and half until June of 2003; ditto for the 1990-91 recession.

So we can expect that job losses will continue until the end of 2010 at the earliest. In other words, if you are unemployed and looking for work and just waiting for the economy to turn the corner, you had better hunker down. All the economic numbers suggest this will take a while. The jobs just are not coming back.

There's really just one hope for our leaders to turn things around: a bold prescription that increases the fiscal stimulus with another round of labor-intensive, shovel-ready infrastructure projects, helps fiscally strapped state and local governments and provides a temporary tax credit to the private sector to hire more workers. Helping the unemployed just by extending unemployment benefits is necessary not sufficient; it leads to persistent unemployment rather than job creation.

The long-term picture for workers and families is even worse than current job loss numbers alone would suggest. Now as a way of sharing the pain, many firms are telling their workers to cut hours, take furloughs and accept lower wages. Specifically, that fall in hours worked is equivalent to another 3 million full time jobs lost on top of the 7.5 million jobs formally lost.

This is very bad news but we must face facts. Many of the lost jobs are gone forever, including construction jobs, finance jobs and manufacturing jobs. Recent studies suggest that a quarter of U.S. jobs are fully out-sourceable over time to other countries.

Well that's just swell news. The main thing is that there seems to be change from "be whatever you want" in this country to "get whatever the heck you can and survive." Not exactly the American dream that everyone has grown to love.

Stimulus creating jobs in districts that don't exist

I'm sure this is an honest mistake, but damn, this is embarassing.

Here's a stimulus success story: In Arizona's 15th congressional district, 30 jobs have been saved or created with just $761,420 in federal stimulus spending. At least that's what the Web site set up by the Obama administration to track the $787 billion stimulus says.

There's one problem, though: There is no 15th congressional district in Arizona; the state has only eight districts.

And ABC News has found many more entries for projects like this in places that are incorrectly identified.

Late Monday, officials with the Recovery Board created to track the stimulus spending, said the mistakes in crediting nonexistent congressional districts were caused by human error.

Just a lesson to all you out there that believe the government is the answer to everything. The government screws up just as much as big business, so giving them complete control of certain sectors in life doesn't mean things will be flowers and babies.

Weak dollar wont help the economy right now

The weak US dollar isn't helping the economy anytime soon, while it is allowing our exports to increase, the amount of imports in this country is growing faster. So it's going to take a couple years.

WASHINGTON – A weaker dollar may boost the nation's economy by increasing exports and narrowing the trade gap — but that won't happen anytime soon.

Instead, the nation's trade deficit rose in September by the largest percentage in a decade as U.S. exports grew for the fifth straight month, but imports rose faster, a government report showed Friday. That trend is likely to continue until the middle of next year, economists said.

Rising oil prices and higher purchases of foreign goods by U.S. companies drove imports higher. So did more purchases of foreign parts by U.S. manufacturers, which are ramping up production in the fledgling economic recovery.

Higher exports, spurred by a lower dollar, probably won't reduce the trade gap and boost the U.S. economy until 2011, economists said.

Meanwhile the job market is still in shambles. It will be interesting to see how the US economy starts to recover if it is actually recovering.

The amazing US economy "officially" recovers

Ladies and gentlemen, the recession is over! Well kinda...

Reporting from Washington - The U.S. economy expanded at an annual rate of 3.5% in the third quarter, unofficially marking the end of the worst recession since World War II.

The growth reported today by the Commerce Department for the three months that ended Sept. 30 snapped four straight quarters of economic contraction and was driven largely by a rebound in consumer spending supported by the federal stimulus package and improved business spending that included a revival of home building.

The increase in the gross domestic product, the total value of goods and services produced in the country, is the evidence most economists have said is needed to declare victory against the recession.

But today's preliminary report doesn't mean the economy is in good shape. Its expansion in the third quarter only partly offsets its dramatic 6% decline last fall and winter. A number of forecasters are predicting weaker expansion in the fourth quarter and in the early part of 2010.

I'm not exactly doing cartwheels over the news but this is certainly a better place to be than say last year when the sky was falling. The main thing with these numbers is that they could easily dip back down and we could see a second leg to the recession if certian things aren't done to the economy. It's still weak in several sectors and I would assume that the average American's confidence in it isn't very high.

High unemployment might be normal in the United States

Some cheery news from the AP. Don't get all excited at once.

WASHINGTON – Even with an economic revival, many U.S. jobs lost during the recession may be gone forever and a weak employment market could linger for years.
That could add up to a "new normal" of higher joblessness and lower standards of living for many Americans, some economists are suggesting.

The words "it's different this time" are always suspect. But economists and policy makers say the job-creating dynamics of previous recoveries can't be counted on now.
Here's why:

• The auto and construction industries helped lead the nation out of past recessions. But the carnage among Detroit's automakers and the surplus of new and foreclosed homes and empty commercial properties make it unlikely these two industries will be engines of growth anytime soon.

• The job market is caught in a vicious circle: Without more jobs, U.S. consumers will have a hard time increasing their spending; but without that spending, businesses might see little reason to start hiring.

• Many small and midsize businesses are still struggling to obtain bank loans, impeding their expansion plans and constraining overall economic growth.

• Higher-income households are spending less because of big losses on their homes, retirement plans and other investments. Lower-income households are cutting back because they can't borrow like they once did.

Now obviously we can't make any comparisons to the Great Depression because if memory serves me right, unemployment was somewhere around 25 percent. As gloomy as it may seem, it's not that bad in America right not. It's crummy, but we could bottom out some more.

I think what Americans will have to come to grips with is that the quality of life in this country will drop for the first time rather than get better. Blame whoever you want, but I believe its a collection of issues that have hit us all at once and now we're going to have to figure out a way to make things work again.

Considering the amount of waste in this country, it almost seems as if the economy is fixing itself by cutting some fat. However, that fat is needed in the pocketbooks of many people and it's just not there anymore.

We're in for a long road, but in order for us to get out of this, the US is going to need to figure out how to survive - not just figure out a way to get back to the economic bubble of the 90s. That model just doesn't work anymore.

Dow Jones reaching 10,000 doesn't mean we're out of the woods yet

Some optimistic news about the economy today as the Dow Jones reached 10,000 for the first time since 2008. Despite this being a triumph for an unsure market still trying to figure out how to weather these tough times, people are being cautious.

Lately, there has been a growing consensus among both investors and economists that the battered U.S. economy hit bottom and turned around earlier this year, and is now in a recovery.

The Federal Reserve said economic activity has "picked up" in its statement after its Sept. 23 meeting, and about 80% of leading economists surveyed by the National Association for Business Economics agreed in a survey earlier this month that the recovery has begun.

But even economists who agree the economy is in recovery say that growth will be slow and difficult, with continued job losses, tight credit and further declines in home prices. And even some who believe that the current Dow 10,000 level is justified say there's still a significant risk that the economy will take a step backward.

"One of the great challenges is whether consumers and small businesses come along with this recovery," said John Silvia, chief economist with Wells Fargo. "If they don't, you either sit at 10,000 or slip back to 9,500. To sustain another double-digit (percentage) gain to Dow 11,000 is asking too much from this economy and the risks we still see out there."

So are we recovering? Tough to tell since unemployment is still high and sales are full of mixed results. The reason for the stock market hitting 10,000 could also be that companies have been cutting costs and therefore their revenue earnings are higher. However no organic growth in the economy is happening. It's essentially another bubble that could burst.

Another reason for the spike is the sweeping away of some "dirty laundry"

Another reason that comparisons to Dow levels of a year ago are risky is that two of the more troubled components -- General Motors and Citigroup (C, Fortune 500) -- were dropped and replaced by stronger companies such as Cisco Systems (CSCO, Fortune 500) and Travelers Cos. (TRV, Fortune 500) in June.

Without those changes the Dow would be almost 100 points lower now than it is with the stronger companies, although precise comparisons are difficult since GM shares are no longer traded on the New York Stock Exchange.

So don't jump the gun yet.

Things are going swell in the state of Illinois

The state of Illinois has a bit of a money problem...

CHICAGO (CBS) ― The State of Illinois' pile of unpaid bills has grown to a record-breaking $3 billion. Comptroller Dan Hynes said Tuesday it's never before been this bad at this point in any previous fiscal year. CBS 2 Political Editor Mike Flannery reports that some social service agencies that rely heavily on state reimbursement warn they will soon be forced out of business.

Hynes said that things are likely to get worse before the state's bleak revenue picture begins to improve.

The comptroller reported corporate income tax receipts down $77 million for July through September; sales tax receipts, down $244 million; personal income tax receipts, down $251 million.

One result: the typical creditor must now wait three months to be paid by the state, compared to a two-month wait at this time last year.

Another sign that the recession is far from over. The simple fact that states can't pay their bills will have huge ramifications for the normal people of America. Much more than the federal government, local and state governments are essential for everyday life expenditures in America. If they tighten up all the doors and stop providing business and basic services, we're going to be in a whole world of hurt.

Perhaps Illinois should get a credit card?