10.2% unemployment – what more proof do …

5 Responses to 10.2% unemployment – what more proof do …

1. jmyrlefuller says:

   November 6, 2009 at 1:36 pm

   It’s not 10.8% (end sarcasm)… read an interesting article this morning:

   The last time unemployment was this high was during Reagan’s first term, but two factors make it a lot different: 1) before Reagan and Volcker implemented their plans, unemployment was already in the 7% range because of Carter’s stagflation policies. It was 4.9% when the mass layoffs started (conveniently, right about the time I graduated college). In other words, we lost twice as many jobs as a percentage of the population in this recession than we did in that one. 2) That was a V-shaped recession, which quickly rebounded… GDP started growing about 8%. Not only that, that growth came without any stimulus whatsoever. The deflationary policies made things less expensive, which spurred people to buy. Funny how the market works like that, and when we try to pump money into the system to create short-term gains, it short-circuits that. The result? Carteresque stagflation.
   • jmyrlefuller says:

     November 6, 2009 at 1:37 pm

     (clarify: the 4.9% thing was last year)
   • Art Stone says:

     November 6, 2009 at 6:16 pm

     Volker is in theory Obama’s advisor, but there was a story about a month ago that Volker hasn’t had any substantive meetings with the administration and he doesn’t know why he is even involved.

     Another thing which is different is the leading edge of the baby boomers is hitting retirement age, going from being producers to being consumers. As the retirees start living off their 401(k) and pensions, money starts to flow out of the capital markets instead of into it. The # of people working will start going down even though unemployment is not going up… unless President Obama decides that forcing retiress to keep working is a way to “save jobs”
2. phistar says:

   November 7, 2009 at 12:02 am

   I wonder if Volcker’s presence last year was little more than campaign window-dressing. Is he still Chair of the Economic Recovery Advisory Board? Perhaps he’s not agreeing with the economic practices of this administration. Times have changed since the early 80’s, when interest rates went through the roof, bringing about the end of stagflation. As a nation, our leaders must not think we can handle taking the pain over the immediate return in exchange for true recovery over the intermediate/long term. Perhaps they’re right. How things have changed in less than thirty years! Or maybe not? Perhaps if we just sit tight and wait for Obama’s “malaise speech,” then we’ll know that everything old is new again.
   • Art Stone says:

     November 7, 2009 at 3:06 pm

     Or when college students are rounded up to go move to the country to work on communal farms instead of the useless college stuff

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