Just trying to post some positive news in the world of economics. I'm surprised no one has posted this stuff yet. This may end up getting political, I couldn't tell whether or not I should post it over there. Check out the following articles. If we're in a recession I sure can't see it.

Economy grows 0.6%
It's not much but according to the article it's been steady through the end of '07 to the first quarter of '08 and does not fit the definition of a recession. (ie. loss)

Jobless rate falls
I don't get this one. They keep talking about the 20,000 job cuts but say that overall the unemployment rate fell by 0.1%, basically more people found work than were fired. Oh, that's right, the fear monger thing. How silly of me.

Dollar gains against the Euro
Several small gains recently has prompted futures traders to bet on the dollar. There is another article showing that the Euro has fallen to a five week low against the dollar and British pound.

For all you caffeine junkies. Starbucks plans on opening fewer stores due to losses. However, the important factor here is that a $6 a cup coffee place is still doing well enough to open 400 new stores. That's good news for people in the construction industry. Also, they still expect revenues to increase 13 - 14% over '07. Not bad for a recession.

I'm an optimist.

Carlos

The jobless rate, or unemployment rate is based on the number of people actually getting an unemployment check. Since you tend to only get a check for 6-12 weeks(IIRC, and except for seasonal workers), when you are no longer eligible to receive the check you are counted as one of the employed, even if you are not working. So as long as less people are applying than those that are leaving the gov.'s unemployment records you have a fall in the jobless rate.

Also if I remember correctly, a healthy economy should/needs to have about a 5-7% unemployment rate. This seems counter intuitive to most, i.e., no one being unemployed would seem like a better economy, but it isn't. A healthy economy needs to have about a 5-7% unemployment rate, so that you don't have to import labor, and it also prevents having to over pay your employees. I remember about 8yrs ago McD's was starting employees out at about $7.30 an hour here in NCA, well above the state's or Fed minimum wage, because they couldn't get people to work there. Of course that all ended once they started hiring illegals.

There's a recession? <img src="/forums/images/graemlins/confused.gif" alt="" />

Doesn't seem like it. $25 an hour jobs for skilled labor are everywhere. Iron workers, Longshormen and concrete unions are heavily recruiting.
Construction industry is booming, Boeing is hiring, National Forest is hiring for summer and road repair season just started. Gas went down 10 cents this weekend.

If anything there's a surplus of blue collar jobs.

Of course those idiots at Yahoo blew thier stockholders chance to get rich this weekend so as thier stock plummets from $32 to $15 a share there will definitly be some layoffs.
Not the fault of the ecomnomy, just greedy executives with fat severance packages already drawn up.

I remember as a kid.

I loved recess. Moreso than lunch time. If you can believe it. <img src="/forums/images/graemlins/oink.gif" alt="" />

Not in my opinion, which was the point of my post and the articles I have linked.

Rich,
I like recess too. Teatherball is the best!

Carlos

'Pollyanna Creep' distorts the reality

Pertaining to the current reality:





The proof is in the real measures in real markets. Gold would be a good start - up 300% since 2000.

Everything is relative.

Take Boeing for example. A place I know well. Sure, Boeing is hiring. Are they hiring back the 40,000 jobs it lost in Washington after 9-11? No. And by the way, I wouldn't be expecting any major additional expansions or hiring sprees at the lazy B in the near future either as they are about to be hit just as hard as everyone else.

Remember, airplanes take gas, just like your car and airliners are paying double or triple what they were a few years ago, yet can't raise ticket prices....you do the math. Then there's the 787 problems, but that's another topic.

This economic cycle we just went through was largely superficial and debt based and its now starting to collasp under its own weight. We are in the very earliest stages of this recession and the reason things are happening relatively slow is because there is a major effort by government and private banking forces, including international central banks, to use every power within their means to stave off what I think they believe could end up being a major U.S. depression, if not world depression. But those efforts are not without a price. We're trading the value of our dollar, our savings, and the cost of critical commodities such a fuel and food, for little more than the "hope" that we can reignite the financial markets and continue to borrow our way through another economic cycle.

This economic up cycle is ending far differently than any other. The end of this cycle is not predominated by a stock market collasp or collasp of the consumer market or job market. Its predominated by a collasp of the financial markets. One cannot underestimate just how critical the financial markets have become to our national and world economies, which are now entirely debt driven and debt based. And that goes from our Federal government, which must borrow half of every dollar it spends right down the average working American stiff who canÆt even so much as buy a TV or a stereo or in many cases, even gas, without putting it on a credit card.

Take away credit and the entire economy comes to a screeching halt and no more so, than this economic cycle, which has been largely driven by a national and regional housing bubbles, which have fuel millions of jobs and pumped trillions of dollars into the economy, via new forms of debt and a massive consumer spending spree, which gave us the false impression that we completely recovered from the last economic cycle of 2001.

Now that all that is gone and there is no foreseeable recovery in the financial markets, its not hard to predict whatÆs going to happen to the rest of the economy. WeÆre already seeing the complete collapse of the housing market in regions where it boomed beyond reasonable values and the job market that it was based on. But those collapses are just beginning.

In these early stages, different areas could be affected differently. Texas, for example, along with much of the South is very anti-union and business friendly and has very low cost of living. They are very attractive to industrial and manufacturing businesses and many are relocating there. The job market could be fairly decent or at least stabilized there and low wage earners will find it easier living than other parts of the country for the foreseeable future.

By contrast, the housing market is very overvalued and set for a major collapse on the West Coast and industry and businesses are leaving, while taxes, which are already very high are likely to go higher to continue to support the many social programs and recent government subsidized overbuilding and over development in that region. The same could be said of the east coast.

The mid-west probably has it the worst of the entire country as they suffer the most immediate loss of industry and jobs. But its hard to say how they will be affected as this gets worse as they're already well into their own recession and are working through it. It will be less of shock to that region, compared to the west coast, which is full of over extended, but otherwise relatively well to do poeple who can't imagine recession, much less personal economic disaster.

But as this thing progresses, no one will probably be immune. Ironicly, I'm starting to consider that Texas and the south could be what California was in the 1930s. The place where all the remaining jobs are where everyone migrats too. And California, Oregon and Washington could be the Oklahoma of the 1930s. But that's getting a little ahead of things.

In the end, its hard to say exactly where we are headed. A common sense look at our economy clearly shows that we are anything but stable and secure and the economic numbers point to a looming total collasp of epic purportions at some point in our future. However, what appeared to be decades away is starting to rear its ugly head much sooner than expected.

I know a weak US dollar cuts both ways. It costs more dollars to purchase foreign goods and services (i.e. oil). It also helps US manufactured goods and services compete with foreign companies. If transportation costs don't get too high, it seems that some export industries could grow.

Higher oil costs translate into higher transportation costs. It seems that this would benefit local producers of consumer goods and produce. Wouldn't this be good for US companies and small businesses?

Of course my crystal ball stopped working years ago. I'm just holding on for the ride! <img src="/forums/images/graemlins/scared.gif" alt="" />

The housing finance market is a prime example of what happens when the GOV tries to "fix" things - a classic case of unintended consequences. The GOV mandated that "redlining" was "unfair", and mortgage lenders had to make riskier loans, so they did, and the loans went sour, and the mortgage backed securities they went into turned brown and started smelling bad. Nobody buys MBS, nobody gets to buy and finance a house, and the housing market collapses. This is somewhat simplistic, and there are other factors, like crazy real estate speculation in some markets, but even that was fueled by risky mortgage loans.

The real reason for any boom-bust cycle is insufficient money supply. They let the banks control the money supply, and they have no incentive to supply enough for the economy to carry out all desired transactions. This leads inevitably to unsold inventories and business bankruptcy as a result.

If we would have kept the regulations from the Great Depression era in place, we probably wouldn't be in this mess. It's one thing to deregulate our banking and financial system, but we've allowed the inmates of the asylum to do something many times worse.

Deregulate, take as much risk as they want, with the complete backing of the American tax payer.

IMO, every single one of these banks, financial institutions, investors, mortgage brokers and right down to the small investor and home owner, that took risk and lost, should lose absolutely everything and fail.

If we're gonna play "free ecomomics" then it damn well better be fair economics. Unfortunately, its been perverted to something that is beyond insanity. If you're rich and powerful, you can take all the risk you want and the little American tax payer will gladly cover your losses through direct tax backed payments and the absorbtion of your losses via the devaluation of his earnings and savings under the color of the declining dollar. <img src="/forums/images/graemlins/angry.gif" alt="" />

I just wonder if all those who voted in the people who advocated for this supposedly free and deregulated system, are now proud of their accomplishments as what little money they had now evaporates out of their savings and wallets.

As far as the economic indicators in the first post in this thread, this article is worth a read. Just a taste of how the economic indicators we rely on are all but worthless.

http://www.onthemedia.org/transcripts/2008/04/25/02