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U-3 Total unemployed, as a percent of the civilian labor force (official unemployment rate)
Current: 6.5%
2008: 8%
2009: 13% 2010: 20%
That's 13% U3 by the end of 2009, 20% by the end of 2010.
On the low end of the forecast, starting 2009 at 7% plus a 5% rise during the year gets us to 12% by year end. On the high end, 7% plus 10% gets us to 17% by the end of 2009.
20 percent U-3 by the end of 2010?
What you are predicting is Armageddon. Default Credit Crisis. Systemic Banking Breakdown. Currency Collapse. Hoarding of Staples. Hyperinflation. Multiple Civil Unrest Episodes(Rodney King). Martial Law. End Game resulting in a New Global Currency Backed by Gold.
Seems the government needs to address the demand side 1st. By investing in Alt-E and infrastructure for a new transportation and energy transport system, the government would create jobs, and thus demand across the productive economy, while at the same time saving billions in future budgets.
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Isn't it really about maintaining productive capacity that would otherwise be destroyed?
As regards small business - small business create jobs, large business destroys them.
Well, I gave ITulip a plug this past weekend. With my host home ill, I ventured to Cheetah's in San Diego.
One dancer said she was just about to buy an '04 car. I told her to wait until August as the glut of new cars was going to squish the pricing in the used car market. She was quite pleased to hear a cheaper price might be in the offing.
To another, we chewed the fat about the economy for awhile (20 minutes). She said she used to make $700+ a night easy, but that's fallen off to $500 and now she struggles to make $300. I told her economics (er following it) is a hobby of mine and supplied her with Itulip, Barry Ritholtz, Calculated Risk, and Michael Shedlock's (aka MISH), as a bevy of mostly free info. Specifically, I told her about EJ's call to sell the market last December and Ka-Poom theory. (Also told her about BR's Bear Stearns and Lehman calls). She asked whether EJ takes questions and wanted to know about when it would be a good time to buy a particular brand of boots. I told her to come onto the blog and post her picture (head shot only, but you can rest assured the rest of her would make most normal guys howl at the moon...) with her comment and she'd get all kinds of attention (and hopefully get the question answered).
Last, I think this was the perfect place to take the pulse of (questionable???) discretionary spending. Monday night, there were 35 women working and 30 guys. The bulk dance price fell from 5 for $100 to 8 for $100, and this was supposedly the top club in SD. I wonder what it will be by March or April?
This is my first post, but I have to agree.
I went to spearmint rhino in torrance (near los angeles) over the holidays a couple of times with my cousin (who is a regular haha).
He actaully knows a lot of the girls personally at this point and I guess it is "slow". They were running a lot of specials like 4 for $30 etc, free t-shirts , $3 drinks, $1 beers, free cover. Whatever it took.
It definitely is a way to gauge people's discretionary spending. I wish I had discovered this site a lot earlier, I would have just cashed out a year ago and not lost a ton of money. Unfortunately I trusted CNBC... grandma used to watch it with me when I was little...
Dr. Doom and Gloom apparently has turned that frown upside down. He's a downright optimist compared to EJ.
I guess he believes the unemployment numbers of today will fall sharply in the coming months.
WASHINGTON (MarketWatch) -- The U.S. recession will last two full years, with gross domestic product falling a cumulative 5%, said Nouriel Roubini, chairman of RGE Monitor. Roubini was one of the first economists to predict the recession and the credit crunch stemming from the housing bubble. For 2009, Roubini predicts GDP will fall 3.4%, with declines in every quarter of the year. The unemployment rate should peak at about 9% in early 2010, he said. Consumer prices will fall about 2% in 2009. Housing prices will probably overshoot, dropping 44% from the peak through mid-2010. "The U.S. economy cannot avoid a severe contraction that has already started and the policy response will have only a limited and delayed effect that will be felt more in 2010 than 2009," he said.
Dr. Doom and Gloom apparently has turned that frown upside down. He's a downright optimist compared to EJ.
I guess he believes the unemployment numbers of today will fall sharply in the coming months.
How can unemployment peak at 9% in two years when unemployment is already 7.2%, up from 5% a year ago? Doesn't make sense. Roubini needs to sharpen his pencil and run the numbers again.
Later U-3 became the official unemployment rate, the definition of U-3 became more like the old U-5 but the definition of "unemployed" also changed.
"Marginally attached workers are persons who currently are neither working nor looking for work but indicate that they want and are available for a job and have looked for work sometime in the recent past. Discouraged workers, a subset of the marginally attached, have given a job-market related reason for not currently looking for a job. Persons employed part time for economic reasons are those who want and are available for full-time work but have had to settle for a part-time schedule." - BLS
There is no apples-to-apples comparison between unemployment rates reported as standard in the 1970s/1980s and today. If we had to say, the old U-5 is probably between the new U-5 and U-6. We'd tell you what the numbers are but the database is currently down (see Bureau of Labor Statistics). Perhaps 9% to 10%?
How can unemployment peak at 9% in two years when unemployment is already 7.2%, up from 5% a year ago? Doesn't make sense. Roubini needs to sharpen his pencil and run the numbers again.
It's not just Roubini. After the BLS jobs report came out today, how many economists were lined up on financial TV to explain why "it's the bottom"? I don't know about you folks, but after one hour of replays tonight I've already lost count...
The favourite statistic to quote in support of this position is the comparison of 2.6 million "official" job losses in 2008 vs the worst post-WWII experience of 2.8 million in 1945. Nobody, absolutely nobody [Taleb excepted, maybe?] is ready for the level of job losses in 2009 that iTulip is expecting.
It's not just Roubini. After the BLS jobs report came out today, how many economists were lined up on financial TV to explain why "it's the bottom"? I don't know about you folks, but after one hour of replays tonight I've already lost count...
The favourite statistic to quote in support of this position is the comparison of 2.6 million "official" job losses in 2008 vs the worst post-WWII experience of 2.8 million in 1945. Nobody, absolutely nobody [Taleb excepted, maybe?] is ready for the level of job losses in 2009 that iTulip is expecting.
but if they read itulip's analysis it's friggin obvious... inescapable... where's the disconnect? why don't other economists challenge itulip? take on ej mano y mano.
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