The effects of the collision that I warned of with Five Short Blasts, rising unemployment and poverty, are really starting to be felt now. Friday the Labor Department reported a loss of another 159,000 jobs. Added to the 605,000 already lost this year, the total is now up to 764,000. And, as I’ve pointed out each month, our labor force grows by about 150,000 each month, thanks to rampant population growth fueled primarily by an extremely high rate of legal immigration. So the shortfall of jobs since the beginning of the year now totals 2,114,000 jobs.
Never mind the “official” unemployment rate of 6.1%. On Thursday it was reported that 497,000 workers filed for unemployment last week, and the rate is rising rapidly. Annualized, that’s a rate of nearly 26 million workers losing their jobs every year – about 17% of the work force!
I have been raising alarm about the trade deficit for many years, asking what will happen when the supply of American assets available for sell-off to fund the deficit begins to dwindle. That day will bring the economy to a screeching halt as foreign credit dries up. Well, that day is rapidly approaching. Credit is drying up and it’s shutting down the economy. Forget about the bail-out package. It won’t do a damn thing to rectify this situation. Hunker down, folks. It’s going to get really bad.