Unemployment Falls to 9.4% from Declining Labor Force
The December seasonally adjusted U-3 unemployment rate fell by 0.34% to 9.43% from 9.77% in November. Including short-term discouraged workers, the December seasonally adjusted U-6 unemployment fell to 16.7% from 17%, with unadjusted U-6 rising to 16.6% from 16.3%. Once you include long-term discouraged workers, the real unemployment rate is now 22.4%, down from 22.6% in November.
Only 103,000 jobs were added in December, which came in less than expectations of 150,000. The sole reason for the decline in the unemployment rate is a shrinking labor force. The civilian participation rate shows that only 64.3% of the U.S. population is now either employed or actively looking for work, a new low for the current recession. The average work week now stands at only 34.3 hours, which is up slightly from the year ago level of 33.8 hours.
The current U.S. level of total non-farm payroll employment now stands at 131.5 million compared to 131.3 million ten years ago in December of 2001. However, the population in December of 2001 was only 285,669,915 compared to a population of 311,853,211 today. To have kept up with population growth, we would need to have 143.3 million non-farm payrolls today, but we are currently 11.8 million jobs short!
http://inflation.us/blog/2011/01/unemployment-falls-to-9-4-from-declining-labor-force/
Only 103,000 jobs were added in December, which came in less than expectations of 150,000. The sole reason for the decline in the unemployment rate is a shrinking labor force. The civilian participation rate shows that only 64.3% of the U.S. population is now either employed or actively looking for work, a new low for the current recession. The average work week now stands at only 34.3 hours, which is up slightly from the year ago level of 33.8 hours.
The current U.S. level of total non-farm payroll employment now stands at 131.5 million compared to 131.3 million ten years ago in December of 2001. However, the population in December of 2001 was only 285,669,915 compared to a population of 311,853,211 today. To have kept up with population growth, we would need to have 143.3 million non-farm payrolls today, but we are currently 11.8 million jobs short!
http://inflation.us/blog/2011/01/unemployment-falls-to-9-4-from-declining-labor-force/
U.S. National Debt Surpasses $14 Trillion
The U.S. national debt has now surpassed $14 trillion. Once you combine our $1.15 trillion in state and $1.7 trillion in local debts, total U.S. government debt now equals $16.85 trillion. Remember, cities and states don’t have printing presses. Therefore, we will likely see a huge surge in municipal debt defaults beginning in the second half of 2011. Of course, if the Federal Reserve creates enough inflation to monetize the federal debt, the depreciation of the U.S. dollar will also allow citizens to more affordably pay off other types of government debt, as well as personal debts.
The upcoming municipal debt defaults could help create a run on the dollar, similar to how individual defaults of euro-zone nations are threatening the existence of the Euro. NIA believes the Euro will be fine because euro-zone nations are implementing tough austerity measures. With the U.S. Presidential election coming up in 2012, there will be no such austerity measures in the U.S. Obama is likely to promise as many giveaways as possible leading up to the 2012 election.
While the mainstream media continues to promote the fact that the U.S. cash budget deficit in 2010 was down 8.7% to $1.294 trillion, the U.S. government just released their 2010 financial report, which showed a GAAP based budget deficit in 2010 of $2.08 trillion, up 66% from one year ago. According to the U.S. treasury, the 66% increase in the GAAP based budget deficit was, “due in large part to increased estimated costs for federal employee and veteran benefits”.
Even this number doesn’t tell the whole story. You see, total U.S. government federal obligations once you include Social Security, Medicare, and Medicaid, now equal about $76 trillion. Our total obligations are up over $5 trillion from one year ago. Therefore, our nation’s real budget deficit is not the $1.294 trillion reported by the media or even the $2.08 trillion admitted to in the government’s brand new 2010 financial report. Our real budget deficit is over $5 trillion!
Sure, these aren’t cash expenses, but if the U.S. government was a publicly traded company, the SEC would require them to report the whole $5 trillion as a loss. Most Americans are depending on Social Security, Medicare, and Medicaid when they retire. If the government decided to wipe out these obligations with the stroke of a pen, you can bet that there will be massive rioting, looting, and civil unrest in Washington, DC, that our nation will never be able to recover from.
Americans are lucky that the U.S. dollar is still the world’s reserve currency. Because the Chinese, Saudis, and other foreigners trade their manufactured products and produced commodities in U.S. dollars, they have the need to hold on to large U.S. dollar reserves. It has been easy for the U.S. to borrow about $1 trillion per year from foreigners, but soon our real annual budget deficit of $5 trillion will turn into actual necessary cash expenditures of $5 trillion per year. There is no chance in hell of the U.S. receiving this from foreigners. When the Federal Reserve becomes the U.S. treasury buyer of last resort and is forced to monetize $5 trillion per year in deficit spending, the velocity of money will explode with the world playing hot potatoes with U.S. dollars. Before long, not a single person on earth will recognize the U.S. dollar as a safe haven. Everybody’s goal will be to get rid of their U.S. dollars as soon as they receive them.
The price of a pumpkin pie may rise from $55,000 when you enter the bakery, to $60,000 by the time you check out, if you are lucky enough for them to have any left. If you spend $200,000 for a bottle of wine and drink it, the empty glass bottle might be worth $200,000 the next morning. Your car that you bought a year ago for $50,000, might cost $50,000 just to refuel with gas.
The upcoming municipal debt defaults could help create a run on the dollar, similar to how individual defaults of euro-zone nations are threatening the existence of the Euro. NIA believes the Euro will be fine because euro-zone nations are implementing tough austerity measures. With the U.S. Presidential election coming up in 2012, there will be no such austerity measures in the U.S. Obama is likely to promise as many giveaways as possible leading up to the 2012 election.
While the mainstream media continues to promote the fact that the U.S. cash budget deficit in 2010 was down 8.7% to $1.294 trillion, the U.S. government just released their 2010 financial report, which showed a GAAP based budget deficit in 2010 of $2.08 trillion, up 66% from one year ago. According to the U.S. treasury, the 66% increase in the GAAP based budget deficit was, “due in large part to increased estimated costs for federal employee and veteran benefits”.
Even this number doesn’t tell the whole story. You see, total U.S. government federal obligations once you include Social Security, Medicare, and Medicaid, now equal about $76 trillion. Our total obligations are up over $5 trillion from one year ago. Therefore, our nation’s real budget deficit is not the $1.294 trillion reported by the media or even the $2.08 trillion admitted to in the government’s brand new 2010 financial report. Our real budget deficit is over $5 trillion!
Sure, these aren’t cash expenses, but if the U.S. government was a publicly traded company, the SEC would require them to report the whole $5 trillion as a loss. Most Americans are depending on Social Security, Medicare, and Medicaid when they retire. If the government decided to wipe out these obligations with the stroke of a pen, you can bet that there will be massive rioting, looting, and civil unrest in Washington, DC, that our nation will never be able to recover from.
Americans are lucky that the U.S. dollar is still the world’s reserve currency. Because the Chinese, Saudis, and other foreigners trade their manufactured products and produced commodities in U.S. dollars, they have the need to hold on to large U.S. dollar reserves. It has been easy for the U.S. to borrow about $1 trillion per year from foreigners, but soon our real annual budget deficit of $5 trillion will turn into actual necessary cash expenditures of $5 trillion per year. There is no chance in hell of the U.S. receiving this from foreigners. When the Federal Reserve becomes the U.S. treasury buyer of last resort and is forced to monetize $5 trillion per year in deficit spending, the velocity of money will explode with the world playing hot potatoes with U.S. dollars. Before long, not a single person on earth will recognize the U.S. dollar as a safe haven. Everybody’s goal will be to get rid of their U.S. dollars as soon as they receive them.
The price of a pumpkin pie may rise from $55,000 when you enter the bakery, to $60,000 by the time you check out, if you are lucky enough for them to have any left. If you spend $200,000 for a bottle of wine and drink it, the empty glass bottle might be worth $200,000 the next morning. Your car that you bought a year ago for $50,000, might cost $50,000 just to refuel with gas.
No comments:
Post a Comment