More Great Economic News

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"The unemployment rate surged to 5 percent in December as the economy added a meager 18,000 jobs, the smallest monthly increase in four years, the Labor Department reported on Friday.

Economists viewed the report as the most powerful indication to date that the United States could well be falling into a recessionary downturn. Evidence of widening unemployment heightened anticipation that the Federal Reserve would further cut interest rates this month, perhaps by an unusually large half a percentage point, in a bid to prevent the economy from sliding into the muck.

“This is unambiguously negative,” said Mark Zandi, chief economist at Moody’s Economy.com. “The economy is on the edge of recession, if we’re not already engulfed in one.”

A recession is typically defined as an extended period of at least several months during which economic activity shrinks and unemployment rises.

The swift deterioration in the job market resonated as a warning sign that troubles once confined to real estate and construction are spilling into the broader economy, threatening the ability of American consumers to keep spending with customary abandon.

On Wall Street, the report led to a big sell-off that sent the Dow Jones industrial average plunging nearly 2 percent. "

(NY TIMES)
 
sandy said:
I think we're doing pretty well considering there are 50 million criminal aliens here. :(
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We all need something to blame our problems on, don't we? Those illegal aliens are doing all the jobs that most Americans will not do, I would say that they are helping the economy rather than destroying it.
 
No, they're taking away jobs from Americans--especially from blacks. If we didn't have 50 million parasites here stealing jobs, there would be more jobs for Americans.
I'm surprised the rate isn't higher. Many of the parasites come here and start collecting unemployment compensation along with the rest of their handouts as soon as they get here. Ugh.:(
 
sandy said:
I'm surprised the rate isn't higher. Many of the parasites come here and start collecting unemployment compensation along with the rest of their handouts as soon as they get here. (
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One can not collect without showing prior employment. It is not easy to collect unemp compensation....
 
kmguru said:
One can not collect without showing prior employment. It is not easy to collect unemp compensation....
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You really don't get it, do you? They come here and STEAL ID's. They STEAL social security numbers. They get handouts all over the place. Come back when you get it. :rolleyes:
 
kmguru said:
One can not collect without showing prior employment. It is not easy to collect unemp compensation....
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Sorry your wrong, to collect welfare you don't need prior employment, in fact it helps if you never had a job, to use our hospitals you don't need prior employment, to attend our schools you don't need prior employment, the only thing you need prior employment is for Unemployment benefits.
 
In California, you have to meet certain requirements to collect unemployment benefits. If you were fired with justifiable cause, you get nothing. If you quit, and cannot provide a reason that meets their definition of justifiable cause, you get nothing.
 
kmguru said:
"The unemployment rate surged to 5 percent in December as the economy added a meager 18,000 jobs, the smallest monthly increase in four years, the Labor Department reported on Friday.
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5% unemployment is full employment, and as for the surge National Statistics Online

The unemployment rate was 5.3 per cent for November 2007, down 11100 over the previous ...
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There were 680,700 job vacancies for the three months to November 2007. This is the highest figure since comparable records began in 2001 and is up 14,500 over the previous quarter and up 81,100 over the year
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There are jobs wanting employees, so why isn't everybody working?

In economics, full employment has more than one meaning. To most lay-people, it means zero unemployment. The majority of economists believe the unemployment rate is greater than 0% when there is full employment. They correspond this idea to the Non-Accelerating Inflation Rate of Unemployment (NAIRU).

20th century British economist William Beveridge stated that an unemployment rate of 3% was full employment. Other economists have provided estimates between 2% & 7%, depending on the country, time period, and the various economists' political biases.

Some Economists estimate a "range" of possible unemployment rates. For example, in 1999, in the United States, the Organization for Economic Cooperation and Development (OECD) gives an estimate of the "full-employment unemployment rate" of 4 to 6.4%. This is the estimated "structural" unemployment rate, (the unemployment when there is full employment), plus & minus, the standard error of the estimate. (Estimates for other countries are also available from the OECD.) [1]
 
Repo Man said:
In California, you have to meet certain requirements to collect unemployment benefits. If you were fired with justifiable cause, you get nothing. If you quit, and cannot provide a reason that meets their definition of justifiable cause, you get nothing.
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But as a illegal you still can collect welfare, go to the hospital and use the services with out paying, send your kids to our schools with out paying tuition, 1/3 of the prison population is illegal's and we pay for that, screw up our Social Security system by using fraudulent SS numbers, and screw with the SS payments for the SS number holder because the numbers don't add up.
 
That is why you can track those fake social security cards and even birth certificates on line. Give me a real one and a fake one, I will tell you which is which usuing the net. So what is the problem?
 
Buffalo Roam said:
Sorry your wrong, to collect welfare you don't need prior employment, in fact it helps if you never had a job, to use our hospitals you don't need prior employment, to attend our schools you don't need prior employment, the only thing you need prior employment is for Unemployment benefits.
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Sounds like you have free hospitals and education. Is that the case?
 
kmguru said:
I do not think the BLS site is correct. I do not think they have a data set that lists specific products, their sku numbers and price that is tracked monthly. So, they can fudge it really good. The best way to find it is to look for your grocery receipt that is 6 months old and check the prices today.
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I am not suggesting that inflation has not been understated by the Feds for years now, but I pulled some numbers straight off the the BLS website, and you're saying that your old grocery receipts are a better measure of inflation.

Color me unimpressed. This is Sciforums. You might want to come up with something a little more scientific to prove a point. Old grocery receipts just aren't going to cut it as proof that government reported statistics are just wrong.
 
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To echo something mentioned in another post, 4% is considered full employment in most economies, and to say that unemployment surged to 5% from the previous month, without providing the number from said month, is a bit suspect.

Anywho, since the Moderator has already established that the Bureau of Labor Statistics is not a credible source of information regarding the state of the economy in the U.S., I doubt anyone will care about my issue with the lack of details.:shrug:
 
From Sandy's POV, just in:

Corporate Earnings: A 2008 Bright Spot?
After a disappointing 2007, profits are expected to rebound in the coming year. But there's a lot that could go wrong

If you're looking for a prime example of the stress and strain on the economy from a tumultuous year, look at corporate profits.

A year ago, analysts were expecting a great 2007. Earnings for the Standard & Poor's 500-stock index were expected to jump 14.5%, according to Reuters Estimates, after a similar performance in 2006.

Boy, were the forecasters wrong.


Easy Comparisons with 2007
Reuters Estimates, which compiles the predictions of thousands of equity analysts, expects earnings to rise only 2.6% in 2007. That number could be reduced as financial firms prepare to report billions of dollars in writedowns from the year's credit crisis. By the time fourth-quarter earnings are released in the next month or so, Goldman Sachs (GS) predicts, 2007 earnings will rise just 0.7% from 2006 levels. That's a bearish sign for investors, who closely watch the ratio between a stock's price and its earnings, because poor earnings may mean that stocks are overvalued.

However, despite the disappointing 2007, and despite the turmoil in the housing and financial markets and the fears of an economic slowdown, many analysts remain surprisingly optimistic about profits in 2008. S&P 500 earnings are expected to spike 15.7% in 2008, according to Reuters Estimates. A weak 2007 makes the year-over-year comparison that much easier.

The case for rising corporate profits in 2008 rests on a few theories and assumptions:

First, no recession, and a pickup in the second half of the year. Worries about a recession or a significant slowdown may be repeated often in the media, but there are few signs equity analysts are worried long term. Reuters Estimates research analyst Ashwani Kaul says analysts seem to be betting on weak growth in the first half of 2008 and then very strong growth in the second half, when the full effect of the Federal Reserve's recent interest rate cuts take hold.

Second, a strong world economy and a weak dollar. Even if the U.S. slows down, American companies can rely on strong growth overseas, especially in emerging economies like India and China, to pick up the slack. Reuters Fundamentals, another research arm of Reuters (RTRSY), calculates 48% of S&P 500 revenues come from outside the U.S. A weak dollar helps, too, because profits earned in euros or other currency end up worth more U.S. dollars. The favorable currency translation could boost S&P 500 profits 3% to 4%, Kaul calculates. Even if the dollar's value rises a bit, a weak dollar still helps, according to Goldman's Michael Moran. "The dollar is still cheap relative to senior currencies, enhancing the competitiveness and market share of U.S. companies," he wrote recently.

Third, tech stays on a roll. A bright spot is the technology sector, which should earn an extra 15% in profits in 2007 and another 24% in 2008, according to Reuters Estimates. Georges Yared, of Yared Investment Research, expects tech's outperformance to continue because the sector tends to benefit from three- to four-year spending cycles, when companies upgrade outdated equipment and software. So far, tech seems to be less than two years into this cycle, he says. Plus, U.S. tech firms benefit from the weaker dollar and global growth.

Fourth, financial firms report huge credit losses in the fourth quarter of 2007, but profits revive in 2008. After billions of dollars in losses from risky debt, the financial sector is expected to see earnings plummet 19% in 2007. Analysts are expecting most of that pain in the last quarter of 2007, as financial firms write off as much bad debt as possible before the new year.

The effect? A possible bounceback in 2008 as most firms have nowhere to go but up. Yared says some big banks and investment houses may be crippled by the tough conditions in 2007, but others—he cites Bank of America (BAC) and Wells Fargo (WFC) as stronger players—may prosper.
 
Corporate profits are not a decent measure of prosperity, or even economic growth.
 
No, not really. The Stock Exchange might only have a limited number of participants and only a few may control a lot. In order for a people to prosper, the people must all have a decent standard of living, where they can feed themselves and their familes, have shelter and have enough to not worry about the future and without severe hard work. In other words, they must have a certain minimum degree of financial freedom. If everyone in a country is in such a situation, then and only then, the country can be seen as prosperous.
 
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