Surging U.S. Unemployment Rate Puts Pressure on Obama (Update2)

Email | Print | A A A



By Bob Willis



March 7 (Bloomberg) – The jump in the U.S. unemployment rate to the highest level in a quarter century last month suggests the recession is deeper than the Obama administration forecasts and additional measures may be needed to restart growth.



The jobless rate rose to 8.1 percent in February as employers reduced payrolls by 651,000, the Labor Department said yesterday in Washington. Losses have now exceeded 600,000 for three straight months, the first time that’s happened since collection of the data began in 1939.



Unemployment has already reached the average rate the White House projected for the whole year. The administration needs to keep its focus on repairing the banking system and implementing the stimulus rather than get diverted by other goals such as healthcare changes, said John Ryding, chief economist at RDQ Economics LLC in New York.



“They should be focused on stabilization” of financial firms “and stimulus – and that should not only be ‘Job one,’ that should be the only job right now,” Ryding said in an interview with Bloomberg Television. “The question is, is it recession or is it something worse than recession?”



U.S. stocks posted the biggest weekly decline in three months after American International Group Inc. reported a $61.7 billion loss and billionaire investor Warren Buffett said the economy is in “shambles.”



Debt Concerns



The Standard & Poor’s 500 Stock Index slumped 7 percent this week, bringing the drop since President Barack Obama took office on Jan. 20 to 20 percent. Benchmark 10-year Treasury yields rose to 2.88 percent yesterday from 2.81 percent the previous day amid concern the government will need to sell more debt.



While the president’s $787 billion stimulus plan aims to create or save 3.5 million jobs, the U.S. has already lost 4.4 million since the recession began in December 2007, with more declines coming. Tumbling global demand is prompting companies from General Motors Corp. to Sears Holdings Corp. to step up firings.



“Without any engines of growth, the labor market and the economy are likely to remain depressed for some time,” Joseph LaVorgna, chief U.S. economist at Deutsche Bank Securities Inc. in New York, wrote in a note. LaVorgna now sees the jobless rate reaching 10 percent by year-end, and he abandoned his call for economic growth to emerge in the second half of 2009.



‘All That’s Necessary’



Obama said today that he’s “committed to doing all that’s necessary to address this crisis,” citing the already-passed stimulus package and measures to slow the tide of home foreclosures and to unlock credit.



“These aren’t just statistics, but hardships experienced personally by millions of Americans who no longer know how they’ll pay their bills, or make their mortgage, or raise their families,” Obama said in his weekly address.



Revisions to January and December statistics lopped an additional 161,000 jobs from previous estimates, the Labor Department’s figures showed.



Payrolls were forecast to drop by 650,000, according to the median of 80 economists surveyed by Bloomberg News. The jobless rate was projected to jump to 7.9 percent.



“We’re going to have to have a lot more jobs than 3.5 million” generated to get a “serious recovery” in the economy, Harvard University professor Robert Barro said in a Bloomberg Television interview. Barro calculated a 30 percent chance the U.S. will slide into a depression, which he characterized as at least a 10 percent drop in gross domestic product.



Factory Payrolls



Factory payrolls fell by 168,000 after declining 257,000 in the prior month. Economists forecast a drop of 200,000. The decrease included 25,300 jobs in producers of machinery and 27,500 in makers of fabricated metal products.



Automakers, at the heart of the manufacturing slump, continued to slash jobs and trim costs to stay in business. General Motors last month said it would cut 47,000 more positions globally while Chrysler LLC announced 3,000 more layoffs.



Auto-parts makers are also suffering. Canton, Ohio-based Timken Co., the supplier of bearings to the world’s top five carmakers, said March 2 it would eliminate as many as 400 salaried jobs this year.



Service industries, which include banks, insurance companies, restaurants and retailers, subtracted 375,000 workers after cutting 276,000. Financial firms cut 44,000 positions after a 52,000 decline the prior month. Retail payrolls decreased by 39,500 after a 38,500 drop.



Sears Shuts Stores



Sears last week said it would shutter 24 stores, on top of eight closings announced earlier.



Government payrolls increased by 9,000 after a gain of 31,000 the prior month, one of the few areas still hiring. Another 26,000 jobs were added by education and health-care providers.



Employers are holding the line on hours. The average work week held at 33.3 hours in February. Average weekly hours worked by factory workers dropped to 39.6 hours from 39.8 hours, while overtime also decreased to 2.6 hours from 2.8 hours. That brought average weekly earnings up by $1 to $615.05.



Slumping sales have caused recent Chapter 11 filings by retailers such as Everything But Water LLC, the largest U.S. retailer of women’s swimwear, and Ritz Camera Centers Inc., the largest chain of camera stores.



Economists polled by Bloomberg last month forecast consumer spending will contract through the first six months of this year after sliding in the last half of 2008. Purchases have not contracted for four consecutive quarters since records began in 1947.



If the recession persists through the first half of this year, it would the longest since the Great Depression. The economy shrank at a 6.2 percent pace in the fourth quarter of 2008, the weakest performance since 1982.













This will start rally



Obama-nation gonna re-evaluate ASAP. they will bag all that healthcare,tax increases, saves the whales, bio fuels, pell grant crap. They not stupid. Timmy (the dumb ass) Geitner will get a phone call from Jesus Obama. At this pace he will be Obama Hoover by June if they dont do something.

Why don’t you two pu$$ies go back to sharing “feel good” poems? And then you can cuddle with each other afterwards.

me?    



have I been acting gay?

wow   interesting



ur name is moodyisapunk? and ur dissing people about being gay



blwo me asswiep

“Yes, Mr. and Mrs. client, the information I have is rock solid. I read it on a web forum. And the best part  is that if it’s bad information,which it can’t be because it’s ‘guaranteed’, they will pay pal the money back into your account! So let’s go all in with everything, OK?”

One day, i predict, in the pretty near future, Barak is going to wake
up and realize he cant f*** over Wall Street, and the business
community in general, without f***ing up America worse than it is. He
is going to start feeling the real heat.

And then finally him and his boys will hit the media and start talking
about helping the banks, and the investment community. Then the market
will give us that monster rally

You guys are dreaming if you think Obama is, at any point, going to spin a 180 and suddenly become market friendly. He doesn’t care a lick about investors. He cares about political power. The worse shape Wall Street is in, the more he can claim that the free market has failed and the more government needs to control. He will continue to play the wealth envy card and there are plenty of Americans stupid enough to believe him. The minute he gets 100% of all federal income taxes being paid by 49% of the electorate, it’s all over. Sure, the economy will be in shambles and America as we’ve known it will be history, but Democrats will control Washington until there’s a revolution (which I will not be holding my breath for).

[quote=YHWY] You guys are dreaming if you think Obama is, at any point, going to spin a 180 and suddenly become market friendly. He doesn’t care a lick about investors. He cares about political power. The worse shape Wall Street is in, the more he can claim that the free market has failed and the more government needs to control. He will continue to play the wealth envy card and there are plenty of Americans stupid enough to believe him. The minute he gets 100% of all federal income taxes being paid by 49% of the electorate, it’s all over. Sure, the economy will be in shambles and America as we’ve known it will be history, but Democrats will control Washington until there’s a revolution (which I will not be holding my breath for).

[/quote]



We are in a death spiral.   He will be jimmy carter when unemployment hits 10 plus %.     

[quote=YHWY] You guys are dreaming if you think Obama is, at any point, going to spin a 180 and suddenly become market friendly. He doesn’t care a lick about investors. He cares about political power. The worse shape Wall Street is in, the more he can claim that the free market has failed and the more government needs to control. He will continue to play the wealth envy card and there are plenty of Americans stupid enough to believe him. The minute he gets 100% of all federal income taxes being paid by 49% of the electorate, it’s all over. Sure, the economy will be in shambles and America as we’ve known it will be history, but Democrats will control Washington until there’s a revolution (which I will not be holding my breath for).

[/quote]



Obama is political scum like the rest of government. He’ll do whatever the money tells him to do.

Guys, I fear that Obama, Pelosi, Reed and their crew want the slide to continue.  If they destroy all the middle class wealth and middle class self-sufficiency, then they have also created a broader need for government programs.   Their government becomes the solution to the problems their government exascerbated. 

Why don’t you two pu$$ies go back to sharing “feel good” poems? And then you can cuddle with each other afterwards.

Guys, I fear that Obama, Pelosi, Reed and their crew want the slide to continue. If they destroy all the middle class wealth and middle class self-sufficiency, then they have also created a broader need for government programs.   Their government becomes the solution to the problems their government exascerbated.

OBAMA=One Big American Made Atrocity

Obama’s political career was launched in Bill Ayers living room.



Bill Ayers 1995:

I am a radical, Leftist, small ‘c’ communist … [Laughs] Maybe I’m the last communist who is willing to admit it. [Laughs] We have always been small ‘c’ communists in the sense that we were never in the Communist party and never Stalinists. The ethics of communism still appeal to me. I don’t like Lenin as much as the early Marx

[quote=go_huskies]OBAMA=One Big American Made Atrocity

The democracy will cease to exist when you take away from those who are willing to work and give to those who would not. -- Thomas Jefferson

[quote=go_huskies]OBAMA=One Big American Made Atrocity

Why is this all of a sudden Obama’s fault? He’s been in office for like two months. 

[quote=etj4588]Why is this all of a sudden Obama’s fault? He’s been in office for like two months.