I've been thinking about omens/precursors, our nation's situation, the global situation, and the coming holiday season. (A Merry Pre-Christmas to one and all). We find ourselves in a strange state of affairs. We need a recovery. We need it soon. There is more than a temptation to look at minuscule changes as signs of how things are getting better. These fluff our hopes and keep our spirits up for a recovery.
Will what we experience (or perceive) to foster a sense of progress to that desired end? This is a question for me, the nation as a whole and even our wider planet as well. Central to "any recovery" is the feeling that the cutbacks (or shortfalls) will recede -- and what we had accomplished at our prime will return. We need to be stronger, do more, consume more, sell more, and have more real purchasing power.
More is definitely better. More tells us we are in recovery. More is the solution.
Last Friday's unemployment numbers were not a good sign. They are probably not even close to being a correct evaluation. The net October decline of 190,000 jobs lost were more than the loss of 171,000 jobs which had been expected; but were less than the 219,000 jobs lost in September. These numbers will be revised with little fanfare over the coming weeks. Still the October additions brought unemployment to just over 10.2 % -- THE HIGHEST SINCE 1982!
We should see a continued spiking of the unemployment figures. When a person looses his/her unemployment benefits, they fall out of the count and our un-employment mess looks "better." By extending the eligibility for benefits across the nation, we shall see a rise in the reported unemployed. Such a bigger and downward "sign" in the employment levels will NOT be a sign of recovery.
There's no such thing as a jobless recovery! Trust me.
Our Gross Domestic Product has morphed from categorizing what we make, to categorizing what we consume. The consumption no longer has to be goods made in the USA. When the US consumer stops (or at least cuts back on) purchasing -- the world hurts big time. While the US has cut back somewhat on its debt financed spending, in August we still bought $20.231 billion more from China, $4.337 billion more from Japan, $3.949 billion more from Mexico, $2.148 billion more from Germany, and $1.886 billion more from Venezuela than we sold to them respectively. Note that Venezuela was our fifth largest trade deficit and our third largest energy supplier.
Energy makes up our largest group of imports. This includes both crude oil imported and petroleum distillates. Our August exports of capital goods ($30.9 billion) were the lowest since October 2005 ($30.7 billion). Our August imports of automotive vehicles and parts ($14.6 billion) were the highest since December 2008 ($15.2 billion). Selling less abroad, while buying more from abroad; is NOT a sign of recovery. Just like the continued growth of unemployment by roughly a quarter million in net lost jobs every month, these are not good things.
Health care makes up about one/seventh of our total economy. This is a huge segment of what makes the US what it is. There is a big push now to nationalize the health care services sector. While our elected officials would categorically deny any connection between an Uncle $ugar led take over of this industry to fix our ailing economy, THAT appears to be exactly what Uncle is doing. Saturday night saw passage of the 1990 page omnibus (everything including the kitchen sink) by the US House of Representative. The 220 to 215 vote was hardly a mandate. The Democrats mustered 219 Dems and one Republican to the AYE side: the Repubes garnered 176 Repubes and 39 Democrats to the NAY side. The outcome was hardly a bipartisan victory.
Besides, the forthcoming battle for passage of "The Affordable Health Care for America Act" in the US Senate is a far cry from being a given at this point.
The week ahead should yield an Obama administration decision on increasing the deployment of US troops in Afghanistan. More young men and women will be sent; but will the increase by 10,000, 20,000, 30,000, 40,000, or more.
Last week's wanton shooting at Fort Hood by an Army Doctor at the largest military base in the Continental US was clearly a pre-response to the President's decision.
The next day's killings at an Orlando office tower (by a laid off engineer) reflects the public's edginess as well.
Will the coming holiday selling season be a sign of a coming turnaround, or will it foretell more trouble?