We Only Lost 250,000 Jobs in June!!!!!

Good times, Good times. Today's June unemployment report came out today and it was a "beat" at -250k jobs. This means that we were expected to lose way more than 250,000 jobs. I'm reasonably sure the Federal Government played with the numbers to make them look less bad but they can only do so much messing.

The funny thing is we lost 250k jobs but the unemployment rate went down from 9.5% to 9.4%. How is this possible? Easy they don't count people who have used up their unemployment benefits which are currently at 19 months after several Federal extensions. People who can't find a job are no longer unemployed after 19 months, I'm not sure what they are but they aren't unemployed that's for sure. See things are getting better.




Just to put it in perspective unemployment was 8.7% in 1930, the year after the crash, in 1931 it raises to 15.9, 23.6% in 1932 and peaks at 25% in 1932. That was the last credit induced "correction", I'm sure we've learned from our mistakes and that could never happen again.....

Too Big to Fail my ass

We are closing in on a year since Bernanke and Paulson came on TV declaring that there was an emergency and that the only way to solve it was to cut them a 700 billion dollar blank check to buy up toxic assets. Of course they didn't use a dime of that money to buy toxic assets, they thought it would be more prudent to just give the money to Goldman Sachs and large banks both American and International. It came down to that the banks were just too big to fail and that to do otherwise would result in a complete disaster. The disaster wasn't prevented, just delayed and we got fleeced for 700 billion. Them's the facts.

So in the year following this "crisis" we reduced the size of the banks and re instituted Glass/Siegel (you know the act that makes a clear distinction between banks and investment houses, sort of like Bank of America and Merrill Lynch) like we should have. Well at least it's all transparent, I'm sure they're just waiting for....ummmm....not sure what they're waiting for.

June Retail Sales: Crappy is the new black

The June retail sales report came out this morning... Down 5% across the board from July 2008. I don't recall last year being spectacular but in comparison I guess it is. Now down 5% is the average, if you were the uber hip A&F down 5% would be awesome because the actual number for them was close to 25%. I guess the demand for $120 jeans and $40 t-shirts is drying up.

Don't worry we'll soon be comparing shitty months to shitty months soon enough. I'm thinking we do just a tad bit less crappy in the coming months, it's amazing what several trillion dollars can buy you. Maybe Nike should worry a little bit.....

Quanitative Easing Explained

The Federal Government needs a couple of two or three trillion dollars, they've got a certain lifestyle to maintain between Social Security, Medicaid, Fighting (2) wars, Debt repayments from previously borrowed money, and backstopping the biggest, worst businesses in America (maybe even the world). Taxes are a wee bit down due to 10% unemployment and they have a pretty big shortfall.

What to do, what to do..... issue IOU's of course!!!! Uncle Sam's version of " I will gladly pay you Tuesday for a hamburger today" is the T-bill. So they set up their T-bill stand and start counting noses.... They can count on institutions they bailed out to put some of that Tarp money to work and we shouldn't neglect other central banks who will trade their crappy paper for our crappy paper (sort of a currency circle jerk) but past that the pickings are slim. So we have a short fall.

No worries! We will collect the money from the large institutions who support us (also known as "marks" or "johns") and then we will fire up the printing presses. To make it as simple as possible we are selling IOU's to ourselves. I'm sure that this will work out really well, I can't see how anything could possibly go wrong, after all this guy is in charge.....

Don't Worry... We're Good for it

From marketwatch:

WASHINGTON (MarketWatch) -- The government's voracious appetite for capital was on display Wednesday as the Treasury Department announced plans to auction a record $75 billion in notes and bonds next week in its quarterly refunding auctions.

The department will auction $37 billion in 3-year notes, $23 billion in 10-year notes and $15 billion in 30-year bonds to refund $60.9 billion in maturing securities and raise $14.1 billion, the department said.

So let me see if I understand this. $60.9 billion of our debt is coming due, perhaps this was for an new aircraft carrier fleet, Part of the AIG bailout, or one of the multitude of stupid ways our government wastes money. Time to put this sad chapter of waste behind us right, clean living from now on right? Wrong!

Uncle Sam doing it's best Amy Winehouse impersonation it isn't paying back the payday cash advance, no it's borrowing more money. You see with all this unemployment the tax coffers are a bit thin and raising taxes now would be political suicide, right? I'm sure when this matures in the reasonably near future raising taxes will be the responsible thing to do, we wouldn't kick the can down the road again would we?

Insurance: Epic Fail

I am not a socialist or even anything even close to it. The idea of going to "the" (as in there are no others) People's Grocery Store and picking up a 6 pack of "People's Beer" sickens me. Beer is a market that's work pretty gosh darn good. There is room for the big and small players in a variety of sizes, styles, tastes and prices. Each beer competes in a daily bloody combat to win my hard earned dollars. Way to go Capitalism!!!!!!

Where it fails badly is in the area of insurance. There are only giant publicly held corporations with a demanding cadre of stockholders to answer to on a quarterly basis. Let's face it I wouldn't go with a boutique or start up insurance company because I feel that in the end it may not be much insurance at all.

These giant companies have to generate profit every 12 weeks or heads will roll, that and fat cats may not get their multi-million dollar bonuses. Screw that, if the financial crisis has taught me anything it's that fat cats will always get their money, come hell or high water. The only way that these companies can make money is when there top line is bigger than their bottom line. This provides (2) incentives: raise rates or reduce costs. They have raised rates so much that less and less people can afford the price tag associated with the insurance and they are just plain not affordable if you have any risk in your life. This makes sure that the people who need insurance most are least able to get it.

The above while bad isn't immoral. This is. Thinking you have insurance, filing a claim and get either denied or a pittance of what you were expecting. Let's think about this. You have just had a major catastrophe in your life and somebody sitting on fat stacks of cash wants to fuck you over. That is just wrong. In all fairness it's not their fault. If you were Mr/Mz big fat cat CEO you would do the same damn thing. It is capitalism that fails here, we provide incentive to decline coverage when needed most to maximize profits.

Let's do away with the greedy, cherry picking, drains on our economy....comrade.

Why????

It is time. I look forward into the future and come to the stark realization that I am about to get screwed again. I wouldn't expect anything less really. My generation realized awhile ago that although things seem to be going swimmingly we would be left with the bill and an apology. I'm not sure we are going to get that apology.

GenX is incapable of producing a hero or heroine, if you prefer. We do what we do not because we want to rise to the occasion but because we are obligated to do it. I will do my best to speak the truth and let the chips fall where they may.

We have become a society of consumers with an entitlement complex. We think it is our God given right to drive a BMW 7 series and live in a McMansion in the suburbs. The time to pay the tab is coming quickly and we have no room left on our collective credit cards.

I am afraid of what the future brings and that the United States will bear no semblance of what it once was. This is why I write.