New unemployment claims were down last week to one of the lowest numbers we’ve seen in three years and businesses added 64,000 new jobs in September. Unfortunately these new claims are still double what we should be seeing to indicate growth as firms continue to fire full-time people to convert to low paid contract labor. And the new jobs total is half what we need to keep up just with population growth to say nothing of recovery.
The third quarter GDP grew by 2% which is anemic when you again consider population growth and the need to put millions of people back to work. This number is also subject to two revisions and maybe worse in the end. The growth is based largely on increased inventory and some added consumer spending as people rush to use the energy tax credit before it expires.
Inventory buildup is not a good thing by any measure since all the growth in the past year has been based on this and any significant downturn would be multiplied as businesses will layoff an even bigger number of employees than they would have ordinarily in order to shed inventory. This also sets the economy up for a deflation death spiral as inventory dumping drives down prices on top of skyrocketing unemployment.
The lack luster economic numbers have increased calls for the Federal Reserve to start printing money in order to inflate the markets. Those already holding trillions in cash from the last Fed printing are crying foul since they were banking on deflation to make asset prices fall to pennies on the dollar. Their plan is to capture the last of the middle class wealth and put it in the hands of those who truly deserve it, you know the people who are already obscenely rich.
Japan and China are still going at it hammer and tongs over rare earth metals or rather it’s hammer and sickle and China has both. Japan can do little but pray for a miracle. China has 97% of the supply and Japan has only what they’ve stockpiled and there is no other source. The US of course has none but we don’t make anything anymore so that’s not such a big problem for us, except that we don’t make anything anymore so we were already sunk.
In England it’s the Sheriff of Nottingham 1, Robin’s merry men 0 with
Britain selling off half its forests by 2020. Maggie Thatcher invented privatization and of course before the Democrats took back Congress there were plans to sell off all of ours too. The commons isn’t for the commoners anymore. If the corporate media can create its desired reality, by Wednesday Speaker Boner will making plans to sell off our commons too. He will also be only two heart beats away from being President Boner, just saying accidents happen.