It wasn't good news by any means, but it also wasn't the end of the world.
The Bureau of Labor Statistics of the U.S. Department of Labor reported January 4 the unemployment rate rose to 5 percent in December, but if you're paying attention to the media coverage, you would think it's time to whip up some shoe leather stew and play "Brother Can You Spare a Dime."
A January 4 Associated Press story by Jeannine Aversa pointed to the job data as one of the "problems in the economy" that has "elevated fears about a recession." But even with all these "problems" - housing woes, the credit crunch, high oil prices, weak job numbers - the criteria of the economy being in a recession still haven't been close to being met.
A recession is a period of general economic decline; specifically, a decline in GDP [gross domestic product] for two or more consecutive quarters.
For the last two quarters, GDP (as reported by the U.S. Commerce Department) has grown at a rate of 3.8 percent in the second quarter of 2007 and 4.9 percent in the third quarter - not a sign of a recessionary trend.
Although fourth-quarter GDP numbers for 2007 won't be released until March, they're not necessarily looking to be negative. Economist and "Kudlow & Company" host Larry Kudlow told viewers of CNBC's January 4 "The Call" that GDP will come in at least at 2 percent.
"Our economy can grow at three-and-a-half percent," Kudlow said. "That is its potential. Right now, in the fourth quarter, it's going to grow one percentage point less."
Although the unemployment report wasn't good, it wasn't nearly as bad as it has been during times of a recession, Aversa pointed out:
"The 5 percent rate for December is relatively low by historical standards. In the recession of the early 1980s, for example, the jobless rate reached double-digit levels."
Unfounded fears about the U.S. economy being in recession, fueled by the media both domestically and abroad, have caused investors to lose faith in the U.S. dollar.
Paul Ashworth, U.S. economist for Capital Economics, an "economic research consultancy" in the United Kingdom, told the January 4 Guardian (U.K.) "if the [U.S.] economy isn't already in recession it must be pretty close by now."
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Comments Policy
Partisan politics is the
January 4, 2008 - 17:03 ET by rbosquePartisan politics is the name of the game. Must have been a mandatory class in journalism school. Perhaps they need to take macro-economics.
10 years ago
January 4, 2008 - 17:28 ET by FAQsTen years ago unemployment was 5.6% and reported as "still low overall." Today's AP headline is "Unemployment Up, Stoking Recession Fears."
http://gatewaypundit.blogspot.com/2008/01/bush-unemployment-at-50-bad-clinton.html#comments
weak dollar?
January 4, 2008 - 17:35 ET by johnGi don't think the media controls the value of the dollar. i would content it has more to do with interest rates, exchange rates, and gov't debt.
also, "unfounded fears?????" really? so current housing trends, consumer confidence, or credit availability aren't good indicators? i agree that no one can state that we're in a recession currently, but to call the fear "unfounded" isn't correct.
let's hope a few more rate cuts come...
i don't think the media
January 4, 2008 - 17:56 ET by Evil Capitalisti don't think the media controls the value of the dollar. i would content it has more to do with interest rates, exchange rates, and gov't debt.
What do you measure value of dollar in?
Also, the last thing you want is another rate cut if you dont like dollar dropping.
answer
January 8, 2008 - 15:37 ET by johnGwhat do i value the dollar in? exchange rates??? i dont't get your question...but honestly im not to worried about FX or inflation right now. weak dollar doesn't worry me as much as weak economy.
Downtalking the economy is
January 4, 2008 - 17:42 ET by robert108Downtalking the economy is part of the BDS of the MSM. They must preach this BS, otherwise they would have to admit that the President's economic policies, specifically his tax rate cuts, have had a positive effect on the economy. They simply can't do that, so they must lie about the state of the economy.
Imagine how we would be doing without this relentless negative propaganda!
Pray tell, if the GDP growth
January 4, 2008 - 17:54 ET by Evil CapitalistPray tell, if the GDP growth is annualized 4%, inflation rate is 2% and dollar has a yearly decline of 5%, what's the GDP equivalent GDP growth with inflation at zero and dollar change at zero?
first of all, this reporter
January 4, 2008 - 18:35 ET by crsheddfirst of all, this reporter didn't say we are IN a recession. in your 3rd paragraph you quoted her as stating ..."elevated fears about a recession." (my emphasis)
i constantly read this site's arguments that we are NOT in a recession. yet, the articles you pan usually say we are headed toward a recession, not IN one.
also in your 3rd paragraph, you mention the "problems", '...But even with all these "problems" - housing woes, the credit crunch, high oil prices, weak job numbers...'
i'm not an economist, but i have noticed a couple things. things like the 'problems' you mentioned. also, in one of my businessess, i use to get 5-6 $50 bills, and 2-3 $100 bills every friday and saturday. now, it takes a month to get that many.
other things pointing toward a recession (note: does not mean we WILL go into a recession) is:
http://blogs.wsj.com/economics/2007/12/13/greenspan-recession-odds-are-rising/ this is from the wall street journal and greenspan, not your usual liberal whinners.
you mention the unemployment rate during the 1980's recession. that was atypically high. http://www.bls.gov/opub/mlr/1983/02/art1exc.htm '...The unemployment rate, already high by historical standards...'
so, are we in a recession? no. are we headed into one? maybe. here are some things i am keeping my eye on:
http://www.forbes.com/2007/12/26/croesus-chronicles-recession-oped-cz_rl_1227croesus.html
all here should stop looking at the definition of recession, and look at the warning signs. if the signs are there, are there things you can do to lessen the impact on you and your family?
maybe, just maybe, the '...elevated fears about a recession." are real.
Elevating fear is one way
January 4, 2008 - 18:44 ET by robert108Elevating fear is one way the MSM tries to create a recession, for partisan political purposes. One possiblity to your question about big bills: debit cards.
possible
January 4, 2008 - 18:46 ET by crsheddyet, i don't think the wall street journal, alan greenspan, or forbes magazine listen all that closely to the msm.
The public does, and public
January 4, 2008 - 23:33 ET by robert108The public does, and public perception of economic bad news leads to caution in buying, which slows things down.
wage hike
January 4, 2008 - 18:35 ET by JimmybobSo, reading the economic numbers.......When did the minimum wage hike begin? Can the connection be made?
not likely
January 4, 2008 - 18:45 ET by crsheddthe minimum wage increased this past summer by 70 cents. according to this site:
http://www.washingtonpost.com/wp-dyn/content/article/2007/07/23/AR2007072301427.html
'Government figures show about 1.7 million people earned $5.15 or less in 2006.' (4th paragraph)
i doubt that 1.7 million, nation wide) getting a 70 cent per hour raise would cause a recession, or even a ripple.
When the minimum wage is
January 4, 2008 - 18:45 ET by robert108When the minimum wage is increased, all other wages move up. Most union wages are pegged to the minimum wage.
good point
January 4, 2008 - 18:54 ET by crsheddit will be hard to tell. when the first increase (70 cents this past summer) '...About 30 states and the District of Columbia have established higher minimum wages that automatically prevail over the federal standard.' from this web-site: http://career-advice.monster.com/salary-trends/How-Will-the-Minimum-Wage-Hike-Affe/home.aspx
therefore, until the federal minimum wage meets or surpasses the state's minimum wage, probably little effect on overall wages.
They want a recession
January 4, 2008 - 18:51 ET by goldboughSeems like they're just itching for a recession to immediately blame Bush and catapult the Dem nominee to the presidency. The MSM will keep trying to manufacture a recession until it happens. Hopefully the country can disprove them.
US Economy has been in recession since we became a debtor
January 4, 2008 - 20:33 ET by Lame CherryI have been blogging on this since the postings here have been battling the MSM attempts to panic the public to elect a Democrat as Iraq is going to be a Republican win issue.
The US economy has been in recession since we became a debtor nation which was about a decade after the gold standard was tanked so the Rothschild and Rockefeller Federal Reserve could start printing money backed by nothing in order to use inflation to create wealth to milk nation states dealing with the United States.
One can expand economies by printing tons of money but without production of product all that is left to sop up money is turning 1970 LTD's costing $1200 to 2007 Ford crap costing $28,000.
Same car, same metal, same production, but now over 20 grand increase DUE TO A WEAK DOLLAR.
The world economy has been in absolute recession since before 9 11 and George Bush saved America can the world from depression by opening up the printing presses and soaking money up in the housing market......which has no run it's trend.
What the US economy is faced with is not "recession" but hyper inflation as the world economy is being geared for. American enemies are using oil. George Bush has countered with grain as the checkmate.
I dislike President Bush's border buster policy, but he has started drilling for oil in Alaska again, he has Mexico tapping massive reserves in the gulf, is going bio fuel TO GENERATE A FARM EXPANSIVE WEALTH CREATING ECONOMY which will trickle up to the entire nation and he has now set the stage for America to withdraw from the Middle East so a world Eurasian war will develop and America might be spared from it.
GW deserve full credit for this.
There are though forces in this world in cartels who want to implode the farm and business economy in order to make America a complete welfare state.........that is communist state. That would be Hillary and that clack on the DNC and their soon to appear savior of Al Gore.
I do not always get the plans of the cartel right as they screw up things too as even the New York Times is now trying to sink Al Gore........but the fact remains just like NAFTA turned into a cartel raping South American nations and now America just as Ronald Reagan was setting it up to be a massive free Republic trading zone.....the same best measures of George Bush can be moulded into enslavement.
I have typed enough here to explain the way to fix this. I have shared this with Newsbusters and shared it with Romney........Romney is silent on it and no GOP'er has attempted to bring about an Franklin economic policy.
The entire structure of the United States should be that EVERY citizen who works without inflation to have the chance to be a millionaire in order to care for themselves and live responsibly.
Government can foster this environment in directing certain capital wealth producing arenas to benefit all Americans who do not have the ability to build it themselves.
Perfect examples were the railroad, the turning of land to wealth in developing it and mining. The same paths are available to this day and America can have Ronald Reagan boom times with the 1950's lender status America held.
The only thing which needs to be done is to inform the cartels which direction things are going and they can gain more wealth and power having productive world citizens adoring them than enslaved sheep being sheared.
*HIC IACET ARTORIVS REX QVONDAM REXQVE FVTVRVS
" Same car, same metal,
January 4, 2008 - 23:36 ET by robert108"
Same car, same metal, same production, but now over 20 grand increase DUE TO A WEAK DOLLAR."
Mostly due to federal smog and safety regulations, as well as CAFE standards.
I am sure that the unions
January 5, 2008 - 08:30 ET by Roger the ShrubberI am sure that the unions have a teensy-weensy bit to do with the high prices, not to mention swell management decisions in the past.
"The Democrat Effect"
January 5, 2008 - 11:13 ET by Joe C.The tiny tax rate cuts of 2001-3 have run their course, and since they are not being made permanent, and expecting that a Democrat will win the presidency, businesses have been preparing for raised taxes and increased regulation in '09 since the increased minimum wage kicked in - The Democrat Effect - hence the slowing we are seeing. A recession is a real possibility this year because of this fear. A new round of real and permanent tax rate cuts are needed ASAP. Plus a conservative president and Congress - something we have rarely had (1 president; 2-4 years of the House in the 90's) and never had together.
I agree, Joe C. Perhaps
January 5, 2008 - 13:25 ET by fitzfongI agree, Joe C. Perhaps the Republicans should also make the case that if we're trending towards a recession, it's only due to the Democrats taking over Congress with their regressive policies. The solution: fiscally Conservative President and a return to a Republican majority in Congress (sans the useless Chafee/DeWine/McCain/Hagel/Spector types)...make the tax cuts permanent!
or...
January 8, 2008 - 15:42 ET by johnGor it could be the tighting of credit, fallout from subprime and a horrible housing market. (all those democrats running wild on wall st, wait they're not...)
but you're right definitely the democrats fault.