Grim Jobs Report: Welcome to the Recession

[onedomino]

I wonder what economic conditions we would have now, if Bush and Congress not blown $3 trillion in money we did not have over the past seven years? We should have been forced to actually pay for the Iraq War, which has been my position from the first ridiculous Bush deficit budget. Those times in these pages that I mentioned we either had to reduce spending or increase taxes to pay for the Iraq War, my position was derided. Even a cursory reading of US contemporary economic history reveals that our worst post WW2 economic slump was caused by Johnson's and Nixon's failure to pay for the Viet Nam War, combined with an oil price shock (exactly the conditions that pertain now). Instead the Viet Nam War was billed to my generation and the result was "stagflation" at first, and then raging inflation under Carter, which obviously was not his fault even though he took the rap (Carter was an amazingly bad President, and he could have tried spending cuts to curb inflation, but the principle cause of his Presidential term's near 20 percent inflation came from Johnson and Nixon). Not only do we forget history, we cannot even remember just a few years ago.

Last Pillar of Denial Is Gone

complete article: http://www.marketwatch.com/news/sto...9A-581C-4599-9406-1995ABE56A70}&dist=hplatest

Only a slim reed of hope remains that recession can be avoided.

WASHINGTON (MarketWatch) - The last pillar to hide behind has fallen. Jobs are being lost in the U.S. economy.

The 17,000 jobs destroyed in January add to the evidence that a recession has begun, but they do not prove the point. One month of hiring cutbacks does not make a recession, but it is a necessary condition. See full story on January employment report.

As noted on Thursday, the employment data in December and January are hard to read. Economist Ray Stone calls them the "dirtiest of the entire year," because weather and the usual swings in employment can cloud the underlying reality.

But most economists believed weather and the seasonal factors would work in favor of January data that looked better it really was. Uh oh.

The figures released Friday by the Labor Department were grim, relieved only by a decline in the jobless rate. It's a slim reed to hold on to.

Employment is falling in almost every sector of the economy. Only the health-care sector, which is immune to the business cycle, was spared completely.

 

[BaronVonBigmeat]

Yeah, it seems like everything I read, it sounds more and more like a replay of the 1970's. For the elections in 2010 and 2012, I'm going to hazard a guess and say that the word "stagflation" will be making a big comeback.

And economically speaking, we'd be a lot better off if it hadn't been for the war. Wars don't produce prosperity, that is a total myth. Think about it: you're basically taking giant stacks of money, and blowing them up. What would that money have bought if it had stayed in the private sector? New factories? Increased R&D so that american industries can stay competitive? The trouble is, you can't make an explicit list of what would have been funded, so people therefore assume that we'd be the same as we are today. Sometimes wars are necessary, but let's not fool ourselves into thinking that it's good for the economy, or that we aren't paying for it even though taxes stayed low. We shifted the burden into the hidden/delayed tax of inflation, that's all.

 

[BaronVonBigmeat]

whoops double post