Despite the stock market’s recent optimism there is nothing to celebrate! No industries are in a growth mode now.
New claims for unemployment benefits declined from 574,000 to 570,000 for the week ending August 29. It most likely is no change because the weekly report is a preliminary number. In the previous week the preliminary number was 570,000 and was adjusted up to 574,000. The September 4 report of 9.7% unemployment rate for August supports this column. Retail sales are down for most national chains.
The very worst layoffs are probably over but the rate is still astonishingly high. When there is no recession the weekly layoffs amount to about 350,000 people. The lay off rate in excess of 600,000 people per week lasted for 14 weeks. So now everyone is celebrating nine weeks of layoffs in the 500,000 to 600,000 range. Even as I write this commentary the AP headlines a story Improving economy not likely to lower jobless rate. This does support my contention that we won’t see job growth any time soon.
The stimulus package has not done its job. Those opposing it were correct. The government posted distribution confirms the argument that too little of the stimulus money would not be put into the economy quickly enough to create any short term benefit.
Recessions are frequently the time for new business ideas. I believe that will be the source of our next boom.
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