The economy shed another 84,000 jobs in August, and the July and June figures were revised upward dramatically. We’ve now lost 605,000 jobs since the beginning of the year. Never mentioned in this report is the fact that our labor force grows by about 150,000 workers per month, due simply to population growth. Therefore, we’re now 1.8 million jobs short of what’s needed to keep unemployment from rising. A shortfall of 1.8 million jobs represents about 1.2% of the work force.
An unexpectedly steep 84,000 U.S. jobs were lost in August and the unemployment rate hit a five-year high of 6.1 percent, fanning worry ahead of November’s presidential vote that the economy was near recession.
“Unexpectedly?” This isn’t unexpected. It’s totally predictable when you understand how trade with overpopulated nations practically guarantees such results.
Here’s the typical response by our lawmakers:
The speaker of the U.S. House of Representatives, California Democrat Nancy Pelosi, renewed a pledge to seek a second economic stimulus program to pick up from one earlier in the year that has now largely been paid out to consumers.
Another economic stimulus won’t help anything, as the first one demonstrated. How can pumping more money into the economy help when it does nothing to address the underlying root cause, our trade deficit? The money will simply be spent on foreign-made products, helping the economies of our trade parasites, but doing almost nothing for our own.
Analysts said the bleak hiring data likely means that Federal Reserve policy-makers will feel obliged to keep interest rates low for an extended period.
Oh, yeah, that’ll help too. That sky-high 2% interest rate is really holding back the economy! Cutting it to 1.75% will really make a huge difference.
But, hey, not to worry! Economists have been predicting that the lower dollar will cure all our ills. It’ll make our products cheaper for foreign buyers and make their products more expensive here, improving the competitive position of domestic manufacturers. We’ll experience a renaissance in manufacturing! Right. So what’s really happening? Take a look:
Some 61,000 manufacturing jobs were lost, the most for any month since mid 2003, and 8,000 more construction jobs were cut. There were 53,000 jobs eliminated in professional and business services and 4,000 in leisure and hospitality industries.
The falling dollar has had zero impact on domestic manufacturers because the trade deficit has nothing to do with currency valuations. It has everything to do with attempting to trade freely with overpopulated nations, trading away our healthy market for access to markets that are badly stunted by overcrowding and low per capita consumption.
Is it any wonder that wages are declining along with household net worth? Is it any wonder that bankruptcies and home foreclosures are soaring?
Any bets on what the September jobs report will look like next month?