Gloom Everywhere Except the Stock Market
November 7, 2008, 3:05 pm
Gloom Everywhere Except the Stock Market
I spent a lot of time looking for the silver lining in today’s employment report. I did not find it.
You have heard by now that the unemployment rate leaped to 6.5 percent, and that the number of people with jobs fell sharply.
But one thing you may not have noticed is that the number of officially unemployed people went above 10 million for the first time since June 1992, and is the highest since September 1983. The economy is much larger than it was then, of course, and the unemployment rate is down from 9.2 percent in 1983 and 7.8 percent in 1992.
Compared to one year earlier, the number of unemployed people was up 38 percent. To make it worse, the number of people who were unemployed because they had lost their job — as opposed to quit or decided to join the labor force — was up 53 percent.
The rest of the day’s news was worse. General Motors and Ford are in deep trouble. Government employment is still rising, but layoffs are starting in some cities. The hope for both cities and automakers is a federal government bailout.
Meanwhile, stocks are up, evidently on expectations of more Fed rate cuts. It is good to see that there still is faith that the government can do something to save this situation, but the rate cuts so far have not accomplished much because lenders remain afraid to lend.
http://norris.blogs.nytimes.com/2008/11/07/gloom-everywhere-except-the-stock-market/