Jim Clifton, the Chairman and CEO of Gallup, says that the percentage of Americans that are employed full-time has been hovering near record lows since the end of the last recession. But most Americans don’t realize this because the official unemployment numbers are extremely misleading. In fact, Clifton says that the official 5.6 percent unemployment rate is a “big lie”. Gallup regularly tracks the percentage of U.S. adults that are employed for 30 or more hours per week, and it is currently at 44.2 percent. It has been hovering between 42 percent and 45 percent since the end of 2009. This is extremely low. As I discussed the other day, there are 8.69 million Americans that are considered to be “officially unemployed” at this point. But there are another 92.90 million Americans that are considered to be “not in the labor force”. Millions upon millions of those Americans would work if they could. Overall, there are 101 million U.S. adults that do not have a job right now. But you won’t hear that number being discussed by the mainstream media, because it would make Barack Obama look really bad.
Most Americans just assume that the economic numbers that we are being given accurately reflect reality. That is why it is so refreshing to have men like Jim Clifton step forward and tell the truth. His recent article entitled “The Big Lie: 5.6% Unemployment” is making headlines all over America. The following is an extended excerpt from that article…
There’s another reason why the official rate is misleading. Say you’re an out-of-work engineer or healthcare worker or construction worker or retail manager: If you perform a minimum of one hour of work in a week and are paid at least $20 — maybe someone pays you to mow their lawn — you’re not officially counted as unemployed in the much-reported 5.6%. Few Americans know this.
Yet another figure of importance that doesn’t get much press: those working part time but wanting full-time work. If you have a degree in chemistry or math and are working 10 hours part time because it is all you can find — in other words, you are severely underemployed — the government doesn’t count you in the 5.6%. Few Americans know this.
There’s no other way to say this. The official unemployment rate, which cruelly overlooks the suffering of the long-term and often permanently unemployed as well as the depressingly underemployed, amounts to a Big Lie.
And it’s a lie that has consequences, because the great American dream is to have a good job, and in recent years, America has failed to deliver that dream more than it has at any time in recent memory. A good job is an individual’s primary identity, their very self-worth, their dignity — it establishes the relationship they have with their friends, community and country. When we fail to deliver a good job that fits a citizen’s talents, training and experience, we are failing the great American dream.
Gallup defines a good job as 30+ hours per week for an organization that provides a regular paycheck. Right now, the U.S. is delivering at a staggeringly low rate of 44%, which is the number of full-time jobs as a percent of the adult population, 18 years and older.
And Gallup is being extremely generous.
I certainly would not define a 30 hour a week job at minimum wage as a “good job”, but Gallup does.
So the truth is that the percentage of U.S. adults that do have “good jobs” is actually far lower than 44 percent.
In the video that I have posted below, there is much more from Clifton about our current employment crisis…
Pretty strong stuff.
But Clifton also understands that there is danger in speaking out like this.
For example, just check out what he told CNBC during one recent interview…
“I think that the number that comes out of BLS [Bureau of Labor Statistics] and the Department of Labor is very, very accurate. I need to make that very, very clear so that I don’t suddenly disappear. I need to make it home tonight.”
So why are there so few good jobs for Americans?
Well, for one thing, our control freak politicians have absolutely murdered job creation in the United States.
Traditionally, small businesses have been the primary engine of job growth for the U.S. economy. But for each of the past six years, the number of new businesses being created has been lower than the number of businesses that have died.
Prior to 2008, we had never seen this happen before in all of U.S. history.
A confluence of factors are coming together to create a perfect storm that is going to be extremely bitter for American workers.
Spending our wealth is not a path to prosperity. We have got to create wealth in order to be a prosperous nation.
But instead, we continue to buy far, far more from the rest of the world than they buy from us. We just learned that the trade deficit increased to 46.6 billion dollars in December, and the total trade deficit for the year was more than half a trillion dollars.
This is complete and utter insanity, but at this point the trade deficit is not even a political issue for either major political party anymore.
And the really bad news is that this is about as good as things are going to get for the U.S. economy. The next major economic downturn is right around the corner, and our employment crisis is going to get much, much worse once that strikes.
Already, layoffs in January were 17.6 percent higher than they were in January a year ago and businesses all over the country are shutting down following a very disappointing holiday season.
In addition, the Baltic Dry Index has dropped to stunningly low levels. In fact, it is already lower than it was at any point during the last recession. The following is an excerpt from a recent article by Mac Slavo…
The Baltic Dry Index (BDI) is used by economists and stock traders alike as a leading economic indicator because it predicts future economic activity. The index tracks in US dollars and measures global supply and demand for commodity shipments among bulk carriers including raw materials like lumber, coal, metallic ores, and grains. What makes this particular measurement so distinct from others, according to economic Howard Simmons, is that the BDI “is totally devoid of speculative content” because “people don’t book freighters unless they have cargo to move.”
On Thursday, the Baltic Dry Index was sitting at 564, That is not too far above the record low level of 554 that was established in July 1986.
So don’t be fooled by all the happy talk from the mainstream media and from politicians like Barack Obama.
They are lying to you, and their lies will soon be evident for all the world to see.
The gravy train is over for oil workers. All over North America, people that felt very secure about their jobs just a few weeks ago are now getting pink slips. There are even some people that I know personally that this has happened to. The economy is really starting to bleed oil patch jobs, and as long as the price of oil stays down at this level the job losses are going to continue. But this is what happens when a “boom” turns into a “bust”. Since 2003, drilling and extraction jobs in the United States have doubled. And these jobs typically pay very well. It is not uncommon for oil patch workers to make well over $100,000 a year, and these are precisely the types of jobs that we cannot afford to be losing. The middle class is struggling mightily as it is. And just like we witnessed in 2008, oil industry layoffs usually come before a downturn in employment for the overall economy. So if you think that it is tough to find a good job in America right now, you definitely will not like what comes next.
At one time, I encouraged those that were desperate for employment to check out states like North Dakota and Texas that were experiencing an oil boom. Unfortunately, the tremendous expansion that we witnessed is now reversing…
In states like North Dakota, Oklahoma and Texas, which have reaped the benefits of a domestic oil boom, the retrenchment is beginning.
“Drilling budgets are being slashed across the board,” said Ron Ness, president of the North Dakota Petroleum Council, which represents more than 500 companies working in the state’s Bakken oil patch.
Smaller budgets and less extraction activity means less jobs.
Often, the loss of a job in this industry can come without any warning whatsoever. Just check out the following example from a recent Bloomberg article…
The first thing oilfield geophysicist Emmanuel Osakwe noticed when he arrived back at work before 8 a.m. last month after a short vacation was all the darkened offices.
By that time of morning, the West Houston building of his oilfield services company was usually bustling with workers. A couple hours later, after a surprise call from Human Resources, Osakwe was adding to the emptiness: one of thousands of energy industry workers getting their pink slips as crude prices have plunged to less than $50 a barrel.
These jobs are not easy to replace. If oil industry veterans go down to the local Wal-Mart to get jobs, they will end up making only a very small fraction of what they once did. Every one of these jobs that gets lost is really going to hurt.
And at this point, the job losses in the oil industry are threatening to become an avalanche. The following are 12 signs that the economy is really starting to bleed oil patch jobs…
#1 It is being projected that the U.S. oil rig count will decline by 15 percent in the first quarter of 2015 alone. And when there are less rigs operating, less workers are needed so people get fired.
#3 Oilfield services provider Baker Hughes has announced that it plans to lay off 7,000 workers.
#4 Schlumberger, a big player in the energy industry, has announced plans to get rid of 9,000 workers.
#5 Suncor Energy is eliminating 1,000 workers from their oil projects up in Canada.
#6 Halliburton’s energy industry operations have slowed down dramatically, so they gave pink slips to 1,000 workers last month.
#7 Diamondback Energy just slashed their capital expenditure budget 40 percent to just $450 million.
#8 Elevation Resources plans to cut their capital expenditure budget from $227 million to $100 million.
#9 Concho Resources says that it plans to reduce the number of rigs that it is operating from 35 to 25.
#10 Tullow Oil has reduced their exploration budget from approximately a billion dollars to about 200 million dollars.
#11 Henry Resources President Danny Campbell has announced that his company is reducing activity “by up to 40 percent“.
#12 The Federal Reserve Bank of Dallas is projecting that 140,000 jobs related to the energy industry will be lost in the state of Texas alone during 2015.
And of course it isn’t just workers that are going to suffer.
Some states are extremely dependent on oil revenues. Just take the state of Alaska for instance. According to one recent news report, 90 percent of the budget of Alaska comes from oil revenue…
But oil is also a revenue source in more than two dozen states, especially for about a third of them. In Alaska, where up to 90 percent of the budget is funded by oil, new Gov. Bill Walker has ordered agency heads to start identifying spending cuts.
Sadly, it looks like oil is not going to rebound any time soon.
China, the biggest user of oil in the world, just reported that economic growth expanded at the slowest pace in 24 years. And concerns about oversupply drove the price of U.S. crude down another couple of dollars on Monday…
Oil declined about 5 percent on Tuesday after the International Monetary Fund cut its 2015 global economic forecast on lower fuel demand and key producer Iran hinted prices could drop to $25 a barrel without supportive OPEC action.
U.S. crude, also known as West Texas Intermediate or WTI, settled 4.7 percent lower at $46.39 a barrel, near its intraday bottom of $46.23.
There is only one other time in history when we have seen an oil price crash of this magnitude.
That was in 2008, just before the greatest financial crisis since the Great Depression.
Many believe that we are now on the verge of the next great financial crisis.
The level of employment in the United States has been declining since the year 2000. There have been moments when things have appeared to have been getting better for a short period of time, and then the decline has resumed. Thanks to the offshoring of millions of jobs, the replacement of millions of workers with technology and the overall weakness of the U.S. economy, the percentage of Americans that are actually working is significantly lower than it was when this century began. And even though things have stabilized at a reduced level over the past few years, it is only a matter of time until the next major wave of the economic collapse strikes and the employment level goes even lower. And the truth is that more good jobs are being lost every single day in America. For example, as you will read about below, Warren Buffett is shutting down a Fruit of the Loom factory in Kentucky and moving it to Honduras just so that he can make a little bit more money. We see this kind of betrayal over and over again, and it is absolutely ripping the middle class of America to shreds.
Below I have posted a chart that you never hear any of our politicians talk about. It is a chart that shows how the percentage of working age Americans with a job has steadily declined since the turn of the century. Just before the last recession, we were sitting at about 63 percent, but now we have been below 59 percent since the end of 2009…
We should be thankful that things have stabilized at this lower level for the past few years.
At least things have not been getting worse.
But anyone that believes that “things have returned to normal” is just being delusional.
And nothing is being done about the long-term trends that are absolutely crippling our economy. One of those trends is the offshoring of middle class jobs. As I mentioned above, Fruit of the Loom (which is essentially owned by Warren Buffett) has made the decision to close their factory in Jamestown, Kentucky and lay off all the workers at that factory by the end of 2014…
Clothing company Fruit of the Loom announced Thursday that it will permanently close its plant in Jamestown and lay off all 600 employees by the end of the year.
The Jamestown plant is the last Fruit of the Loom plant in a state where the company had once been a manufacturing titan second only to General Electric.
This isn’t being done because Fruit of the Loom is going out of business. They are still going to be making t-shirts and underwear. They are just going to be making them in Honduras from now on…
The company, owned by Warren Buffett’s Berkshire Hathaway but headquartered in Bowling Green, said the move is “part of the company’s ongoing efforts to align its global supply chain” and will allow the company to better use its existing investments to provide products cheaper and faster.
The company said it is moving the plant’s textile operations to Honduras to save money.
So what are those workers supposed to do?
Go on welfare?
The number of Americans that are dependent on the government is already at an all-time record high.
And doesn’t Warren Buffett already have enough money?
In business school, they teach you that the sole responsibility of a corporation is to maximize wealth for the shareholders.
And so when business students get out into “the real world”, that is how they behave.
But the truth is that corporations have a responsibility to treat their workers, their customers and the communities in which they operate well. This responsibility exists whether corporate executives want to admit it or not.
And we all have a responsibility to our fellow citizens. When we stand aside and do nothing as millions of good paying American jobs are shipped overseas so that the “one world economic agenda” can be advanced and so that men like Warren Buffett can stuff their pockets just a little bit more, we are failing our fellow countrymen.
Because so many of us have fallen for the lie that “globalism is good”, we have allowed our once great manufacturing cities to crumble and die. Just consider what is happening to Detroit. It was once the greatest manufacturing city in the history of the planet, but now foreign newspapers publish stories about what a horror show that it has become…
Khalil Ligon couldn’t tell if the robbers were in her house. She had just returned home to find her front window smashed and a brick lying among shattered glass on the floor. Ligon, an urban planner who lives alone on Detroit’s east side, stepped out and called the police.
It wasn’t the first time Ligon’s home had been broken into, she told me. And when Detroit police officers finally arrived the next day, surveying an area marred by abandoned structures and overgrown vegetation, they asked Ligon a question she often ponders herself: why is she still in Detroit?
Of course this kind of thing is not just happening to Detroit. The truth is that it is happening all over the nation. For example, this article contains an incredible graphic which shows how the middle class of Chicago has steadily disappeared over the past several decades.
Once again, even though we have never had a “recovery”, it is a good thing that things have at least stabilized at a lower level for the past few years.
But now there are all sorts of indications that we are rapidly heading toward yet another economic downturn. The tsunami of retail store closings that is now upon us is just one sign of this. The following is a partial list of retail store closings from a recent article by Daniel Jennings…
Quiznos has filed for bankruptcy, USA Today reported, and could close many of its 2,100 stores.
Sbarro which operates pizza and Italian restaurants in malls, is planning to close 155 locations in the United States and Canada. That means nearly 20 percent of Sbarro’s will close. The chain operates around 800 outlets.
Ruby Tuesday announced plans to close 30 restaurants in January after its sales fell by 7.8 percent. The chain currently operates around 775 steakhouses across the US.
An unknown number of Red Lobster stores will be sold. The chain is in such bad shape that the parent company, Darden Restaurants Inc., had to issue a press release stating that the chain would not close. Instead Darden is planning to spin Red Lobster off into another company and sell some of its stores.
Ralph’s, a subsidiary of Kroger, has announced plans to close 15 supermarkets in Southern California within 60 days.
Safeway closed 72 Dominick’s grocery stores in the Chicago area last year.
But it isn’t just the retail industry that is deeply troubled.
All over America we are seeing economic weakness.
In this economic environment, it doesn’t matter how smart, how educated or how experienced you are. If you are out of work, it can be extremely difficult to find a new job. Just consider the case of Abe Gorelick…
Abe Gorelick has decades of marketing experience, an extensive contact list, an Ivy League undergraduate degree, a master’s in business from the University of Chicago, ideas about how to reach consumers young and old, experience working with businesses from start-ups to huge financial firms and an upbeat, effervescent way about him. What he does not have — and has not had for the last year — is a full-time job.
Five years since the recession ended, it is a story still shared by millions. Mr. Gorelick, 57, lost his position at a large marketing firm last March. As he searched, taking on freelance and consulting work, his family’s finances slowly frayed. He is now working three jobs, driving a cab and picking up shifts at Lord & Taylor and Whole Foods.
So what does Abe need in order to find a decent job?
No, what he needs is an economy that produces good jobs.
Sadly, the cold, hard reality of the matter is that the U.S. economy will never produce enough jobs for everyone ever again.
The way that America used to work is long gone, and it has been replaced by a cold, heartless environment where the company that you work for could rip your job away from you at a moment’s notice if they decide that it will put a few extra pennies into the pockets of the shareholders.
You may have worked incredibly hard for 30 years and been super loyal to your company.
It doesn’t matter anymore.
All that matters is the bottom line, and in the process the middle class is being destroyed. But by destroying the middle class, those corporations are destroying the consumer base that their corporate empires were built upon in the first place.
Read more here: http://www.kentucky.com/2014/04/03/3177378/fruit-of-the-loom-to-close-jamestown.html#storylink=cpy
Read more here: http://www.kentucky.com/2014/04/03/3177378/fruit-of-the-loom-to-close-jamestown.html#storylink=cpy
The stock market may be soaring to unprecedented heights, but things just continue to get even tougher for the middle class. In this economic environment, there is intense competition for virtually all kinds of jobs. For example, more than 1,600 applications were recently submitted for just 36 jobs at an ice cream plant in Hagerstown, Maryland. That means that those applying have about a 2 percent chance of being hired. About 98 percent of the applicants will be turned away. That is how tough things are in many areas of the country today. It is now more than five years after the great financial crash of 2008, and the level of employment in the United States is still almost exactly where it was at during the worst moments of the last recession. And this is just the beginning. The next major financial crash is rapidly approaching, and once it strikes our employment crisis is going to get much, much worse.
Working at an ice cream plant does not pay very well. But at least it beats flipping burgers or stocking shelves at Wal-Mart. And in this economy, there is no shortage of desperate workers that are willing to take just about any job that they can find. The following is how a Breitbart article described the flood of applications that were received for just 36 positions at an ice cream plant owned by Shenandoah Family Farms in Hagerstown, Maryland…
Thanks to persistent unemployment and low availability of low-skill jobs, Shenandoah Family Farms’ ice cream plant in Hagerstown, Maryland has received over 1,600 applicants for a grand total of 36 jobs. Many of those applicants are former workers at the Good Humor plant that was bought by Shenandoah Family Farms. “You’d think that after 20-some-years working someplace at least somebody would think you area a good person, that you’d show up on time every day, and that would be worth something,” Luther Brooks, a 50-year-old former worker at the plant told the Washington Post. “I can’t get nothing. I’ve tried.”
Anyone that believes that the economic crisis is “over” is just being delusional. It may be “over” for the boys and girls that work on Wall Street, but even their good times are only temporary.
Of course most Americans are not fooled by the propaganda being put out by the mainstream media. According to a recent CNN poll, 70 percent of all Americans believe that “the economy is generally in poor shape”.
And according to another survey, the economy is still the #1 concern for American voters by a good margin and unemployment is still the #2 concern for American voters by a good margin.
The American people can see that mid-wage jobs are disappearing and that the middle class is being systematically eviscerated. The following is a short excerpt from a recent Business Insider article…
A startling number of middle-class jobs may be headed toward extinction.
More than any other job class, mid-level positions have struggled to recover from the recession, and only a quarter of jobs created in the past three years are categorized as mid-wage. There are high-skilled professional jobs that require college degrees and low-skilled service jobs for less educated workers, but the middle is getting squeezed.
As mid-wage jobs disappear, they are being replaced by low wage jobs. As I mentioned yesterday, one recent study found that about 60 percent of the jobs that have been “created” since the end of the last recession pay $13.83 or less an hour.
And this is just the beginning of the decline of the middle class. Another great financial crisis is rapidly approaching, and once it arrives things are going to get much worse than they are right now.
A number of very prominent experts believe that this next great financial crisis could begin in 2014. For example, in a recent article entitled “Top Ten Trends 2014: A Year of Extremes“, Gerald Celente warned that “an economic shock wave” could hit the United States by the middle of the year. Here are some excerpts from that article…
-“In 33 years of forecasting trends, the Trends Research Institute has never seen a new year that will witness severe economic hardship and social unrest on one hand, and deep philosophic enlightenment and personal enrichment on the other. A series of dynamic socioeconomic and transformative geopolitical trend points are aligning in 2014 to ring in the worst and best of times.”
-“Such unforeseeable factors aside, we forecast that around March, or by the end of the second quarter of 2014, an economic shock wave will rattle the world equity markets.”
-“Nearly half of the requests for emergency assistance to stave off hunger or homelessness comes from people with full-time jobs. As government safety nets are pulled out from under them – as they will continue to be for the foreseeable future – the citizens of Slavelandia will have no recourse but action.”
And according to the Wall Street Journal, United-ICAP chief market technician Walter Zimmerman in convinced that 2014 will mark the beginning of a massive stock market decline. In fact, he believes that over the next couple of years it could fall by more than 70 percent…
In what may be the bearish call to end all bearish calls, one technician believes 2014 will be the year of “major reversals,” with the Dow Jones Industrial Average expected to start a two-year decline that could eventually take it down more than 70% to below 5000.
If his forecast is correct, it will make what happened in 2008 look like a Sunday picnic…
“Based on our longer-term time cycles the present stock market rally must be considered the bubble to end all bubbles,” Mr. Zimmerman wrote in a note to clients.
He doesn’t believe the Dow Industrials will hit a long-term cycle low until 2016, somewhere in the 5770 to 4650 range. The Dow hasn’t seen those levels, which are 65% to 72% below current prices, since late-1995 to mid-1996.
So what do you think the rest of 2014 will bring?
Please feel free to share your thoughts by posting a comment below…
What advice would you give to a retired Air Force Colonel that has three graduate degrees and that cannot even find work as a janitor? 59-year-old Robert Freniere once served as a special assistant to General Stanley McChrystal, and he has spent extensive time in both Iraq and Afghanistan. But now this man who once had an office in the heart of the Pentagon cannot find anyone who will hire him. In addition to his story, in this article you will also hear about several other middle-aged professionals that cannot find work in this economy either. Despite what the Obama administration and the mainstream media are telling you, the truth is that there has been no employment recovery in this country. What you are about to read is absolutely heartbreaking, but it represents the reality of what is really going on out there in the streets of America today.
A lot of unemployed Americans believe that they cannot find work because they don’t have enough “education” or enough “experience”. Well, the truth is that there are a whole lot of people out there like Freniere that have lots of both and still can’t even get hired as a janitor…
After a 30-year military career in which he earned three graduate degrees, rose to the rank of colonel, and served as an aide to Pentagon brass, Robert Freniere can guess what people might say when they learn he’s unemployed and lives out of his van:
Why doesn’t this guy get a job as a janitor?
Freniere answers his own question: “Well, I’ve tried that.”
Freniere, 59, says that his plea for help, to a janitor he once praised when the man was mopping the floors of his Washington office, went unfulfilled. So have dozens of job applications, he says, the ones he has filled out six hours a day, day after day, on public library computers.
So Freniere, a man who braved multiple combat zones and was hailed as “a leading light” by an admiral, is now fighting a new battle: homelessness.
You can read the rest of that article right here. This just shows how badly the private sector in the United States is failing. Someone with Freniere’s education and experience should be able to find work easily if our economy truly was healthy.
Earlier last year, the 59-year-old Shields lost her townhouse and now rents a single room in her Southern California town. At one point, she managed a team of 60 people for a large retailer. She lost that job in 2011 but took another one—and a 20 percent pay cut—some months later. When that store closed in 2012, her luck ran out, and she has been looking for work ever since.
“My federal [unemployment] benefits (were) about $1,200 a month, and that’s all I get. … I have been very dependent on the generosity of my family members,” Shields said.
Her retirement savings exhausted, Shields said she doesn’t know what she’ll do if Congress doesn’t eventually authorize an extension.
As I have written about previously, a lot of unemployed Americans are going to lose their last lifeline now that their extended unemployment benefits are being cut off. In fact, it is being projected that a total of 5 million unemployed Americans will lose their benefits by the end of 2014. Many of those unemployed workers will end up losing everything. One example of this is 53-year-old biotech researcher Vera Volk…
Massachusetts resident Vera Volk also has a master’s degree, but the 53-year-old biotech researcher lost her job at the end of May and has been selling prized possessions in order to stay afloat.
“We’ve had to cash in everything that we could potentially cash in,” Volk said. “We’ve got our water heater down to the lowest we could potentially tolerate.” Volk’s extended unemployment benefits of $480 a week are the couple’s sole source of income. They’re four months behind on their mortgage, and although she and her husband have chronic health conditions, they couldn’t afford to keep paying for health insurance.
What would you do if you lost your job and couldn’t find another one no matter how hard you tried?
The pickup truck will probably be the first thing to go.
It’s the first new car that Jeremy Botta has ever bought, using his savings from working for more than 14 years at the same auto repair shop. “I bent over backwards—I worked almost a 100 hours a week on my salary to turn that store around,” said Botta, 37, who was laid off in April after the shop changed owners.
Have you ever worked 100 hours a week?
There are many Americans out there that put in crazy hours month after month and end up with nothing to show for it.
Now Botta is facing the very real possibility that he will have to sell his house just to survive…
“If it comes down to it, I’ll have to sell the house,” says Botta, who bought the place in Bend, Ore., just months before he suddenly lost his job, which netted him as much as $60,000 in a good year. Having already raided his retirement savings, Botta thinks he’ll need to take three or four part-time jobs, working 60 to 70 hours a week just to get by without the unemployment checks.
“I don’t know how people make it on minimum wage,” says Botta. Having applied for nearly 100 jobs without luck—including cashier’s positions at Home Depot and Lowe’s—Botta expects he’ll be pumping gas if he’s lucky.
And these days it is not just those with little education that are being forced to work low paying jobs. In fact, the number of college graduates working minimum wage jobs has doubled since 2007.
In addition, according to a National Employment Law Project study about 60 percent of the jobs that have been “created” since the end of the last recession pay $13.83 or less an hour.
But you can’t support a family on that kind of an income. In millions of homes in America today, both the father and the mother work multiple jobs and there still isn’t enough money at the end of the month.
The middle class is being systematically destroyed and poverty is absolutely soaring. In some areas of the country, more than 40 percent of the people live below the poverty line. You can check out an interactive map which shows where the highest levels of poverty in America are right here. As you can see, the southern half of the nation has been hit particularly hard.
In a desperate attempt to stay afloat, more Americans than ever are turning to emergency loans. I have written about the payday loan scam previously, but now a new twist on that scam has emerged.
They are being called “workplace loans”, and companies all over America are beginning to offer them as “benefits” to their workers. But the effective annual percentage rate on these loans can be as high as 165 percent…
Arizona Restaurant Systems Inc., a Scottsdale, Ariz., company that operates 28 Sonic locations in the state, allows workers to take out loans ranging from $150 to $500 that typically last two weeks.
The fees, ranging from $8 to $25 plus interest, don’t go to the restaurant franchisee, but to a lender called Think Finance Inc., which makes the loans. Based on the fees, the loans carry an effective annual percentage rate of 100% to 165%.
Please don’t get trapped in any of those loans. They simply are not worth it.
Unfortunately, this is just the start of our economic problems. We are in the midst of a long-term economic decline that will soon greatly accelerate.
And despite relentless propaganda from the mainstream media about how “good” things are, most Americans are very pessimistic about where things are headed. According to a survey conducted in December by the AP-NORC Center for Public Affairs Research, 54 percent of all Americans believe that life in America will “go downhill” as we approach 2050, and only 23 percent believe that life will improve during the next few decades.
Also, Americans seem to have very little faith in the federal government at this point. According to a shocking new poll that was just released, only one out of every 20 Americans believe that the government is functioning well and needs no changes, and 70 percent of all Americans do not have confidence that the government will “make progress on the important problems and issues facing the country in 2014.”
If you are waiting for our politicians to fix everything and save the day, you can quit holding your breath. They are way too busy having fun and raising money for their next campaigns.
For example, despite the fact that our country is falling apart all around us, Barack Obama just took an extended holiday vacation out in Hawaii and played his 160th round of golf since taking office.
Our “leaders” are not going to rescue us from what is coming. That is why it is imperative to get prepared for the coming storm while you still can.
If you think that the latest employment numbers are good news, you might want to look again. In April 2013, 58.6 percent of all working age Americans had a job. But three years ago, in April 2010, 58.7 percent of all working age Americans had a job. Well, you may argue, that is not much of a difference. And that is precisely my point. The percentage of Americans that have a job fell like a rock during the last recession. It dropped from about 63 percent all the way down to below 59 percent, and it has stayed below 59 percent for 44 months in a row. So where is the recovery? This is the first time in the post-World War II era that the employment-population ratio has not bounced back after the end of a recession. So anyone that tells you that we are experiencing an employment recovery is lying to you. Yes, the U.S. economy added 165,000 jobs last month. But it takes nearly that many jobs just to keep up with population growth. The truth is that we are just treading water.
So why has the unemployment rate been going down? Well, it is because the government has been pretending that millions upon millions of unemployed Americans “don’t want jobs” anymore. In fact, an astounding 9.5 million Americans have “left the workforce” since Barack Obama took office.
Some in the mainstream media have started calling them “missing workers”. But whatever label you want to use, the reality of the matter is that they are really hurting. They are part of the reason why food stamp enrollment has soared from 32 million to more than 47 million while Barack Obama has been in the White House.
If you still believe that the employment market is getting better, just look at the following numbers. The percentage of working age Americans with a job has been sitting at about the same level for four years in a row…
April 2008: 62.7 percent
April 2009: 59.8 percent
April 2010: 58.7 percent
April 2011: 58.4 percent
April 2012: 58.5 percent
April 2013: 58.6 percent
So why is everyone getting so excited over the latest numbers? When you step back and look at what has happened to the employment-population ratio over the past decade it really is quite horrifying…
So exactly what part of that chart are we supposed to get excited about?
Yes, I suppose that we should be thankful that the percentage of Americans with a job has not continued to decline over the past few years. Unfortunately, the next major wave of the economic collapse is rapidly approaching and that is going to make our employment crisis far worse.
A recovery was supposed to already happen by now. Now we are running out of time before the next major downturn strikes.
And things have been particularly hard for our young people. Even if our young people do go to college, there is a very good chance that good jobs will not be waiting for them once they graduate.
According to Accenture’s 2013 College Graduate Employment Survey, 41 percent of all Millennials who graduated from college during the past two years are working in jobs that actually do not require a college degree.
Sadly, the future does not look bright for the American worker. The big corporations that dominate our society are feverishly trying to increase profits by getting rid of as many “expensive” American workers as possible. That is one of the reasons why corporate profits as a percentage of GDP are at a record high, but wages as a percentage of GDP are at an all-time low.
But the financial markets seem to be absolutely thrilled with the present state of affairs. The latest employment numbers caused the Dow to shoot past 15,000 and the S&P 500 to push past 1600.
Of course stocks have become completely and totally divorced from economic reality, but this does happen from time to time and it never lasts forever. At some point there will be a rude awakening.
And I anticipated that we could potentially see the Dow hit 15,000 before it finally crashed. Back in February, I made the following statement…
Right now, everyone seems to be quite giddy about the fact that the Dow is marching toward an all-time high. And I actually do believe that the Dow will blow right past it. In fact, it is even possible that we could see the Dow hit 15,000 before everything starts falling apart.
Well, now we have seen the Dow hit 15,000. But that doesn’t change any of the long-term trends that are absolutely eviscerating our economy.
Well, isn’t that convenient? The Obama campaign desperately needed the last employment report to be released before the election to show that the unemployment rate had fallen below 8 percent, and somehow it magically happened. Even though non-farm payroll employment only increased by 114,000 last month (not enough to even keep up with population growth), the official unemployment rate fell from 8.1 percent to 7.8 percent. So how did that happen? Well, the unemployment number is not based on the survey of employers that showed that 114,000 jobs were added to the economy last month. Rather it is based on a survey of households. And that survey showed that the total number of Americans employed last month increased by a whopping 873,000 – almost eight times the number that the employer survey showed. That figure for September (873,000) was the biggest one month increase in 29 years. And it just happened to come at the exact perfect time for Barack Obama. So was there a jobs report conspiracy? Examine the evidence and decide for yourself.
The number of Americans with a job fell by 195,000 in July.
But somehow in September it miraculously exploded in the other direction and 873,000 jobs were added to the economy?
If you believe that, I have a bridge that I want to sell you.
Somehow, the largest increase in jobs in 29 years happened just when Barack Obama needed it the most.
Nah, that doesn’t sound fishy to me at all.
We are being told that a big reason for the huge increase was the number of Americans working part-time for “economic reasons”. That number surged from 8.0 million in August to 8.6 million in September.
Why the sudden jump?
Nobody can really explain it.
And if you look at the U6 unemployment rate, nothing has really changed at all. U6 is still at 14.7 percent just like it was last month.
But the media is not going to talk about the U6 rate. Instead, all of the headlines are going to be about “7.8 percent”.
According to the survey of employers, the U.S. economy added fewer jobs in September than it did in August, and it added fewer jobs in August than it did in July.
So according to the survey of employers, the employment situation in the United States is getting worse.
But according to the household survey, we just had the greatest month of job creation since the first term of Ronald Reagan.
Something does not add up.
And as I have written about previously, the unemployment rate would actually be up around 11 percent instead of 7.8 percent if not for the millions of workers that the government claims “dropped out of the labor force” over the past few years because they became too discouraged to look for work.
So unemployment in America is still a massive crisis, but the media is boldly proclaiming that things are getting better and that we are on the road to recovery.
Of course Obama looks like the cat who ate the canary today. He is just thrilled with the “7.8 percent” number.
But the truth is that according to the employer survey, job growth in the United States is actually slower than last year. The following is from the Calculated Risk blog….
All that said, the economy has only added 1.3 million payroll jobs over the first nine months of the year. At this pace, the economy would only add around 1.8 million private sector jobs in 2012; less than the 2.1 million added in 2011.
Are you starting to see why people are so skeptical of this jobs report?
When the “7.8 percent” figure was released, there was immediately a wave of shock and unbelief throughout the financial world and all over the Internet.
The following is a sampling of skeptical quotes about this jobs report….
“Weird that payrolls are exactly on forecast but household survey is far better.”
Conn Carroll, senior editorial writer for the Washington Examiner
While it is highly improbable that BLS conspired to cook the books, there is still a huge 756,000 job gap between the number of jobs employers told the Labor Department they created in September (114k), and the number of Americans who told the labor department that they got new jobs (873k).
I agree with former GE CEO Jack Welch, Chicago style politics is at work here. Somehow by manipulation of data we are all of a sudden below 8 percent unemployment, a month from the Presidential election. This is Orwellian to say the least and representative of Saul Alinsky tactics from the book “Rules for Radicals”- a must read for all who want to know how the left strategize . Trust the Obama administration? Sure, and the spontaneous reaction to a video caused the death of our Ambassador……and pigs fly.
That the 7.8 percent jobless rate takes it to the level that prevailed when the President took office in January 2009 has raised many an eyebrow. I don’t believe in conspiracy theories. But I don’t believe in the Household Survey either.
This notoriously volatile indicator has become even more so in recent months. It showed a 195K slide in July and a 119K decline in August, to only then reveal a massive 873K surge in September.
“Either the Federal Reserve, which has its fingers on the pulse of every element of the economy, and the Bureau of Labor Statistics manufacturing survey report are grievously wrong or the number used to calculate the unemployment rate are wrong, or worse manipulated. Given that these numbers conveniently meet Obama’s campaign promises one month before the election, the conclusions are obvious.”
The mainstream media is hailing QE3 as a great victory for the U.S. economy. On nearly every news broadcast, the “talking heads” are declaring that Ben Bernanke’s decision to pump 40 billion dollars a month into our financial system is definitely going to help solve our economic problems. The money for QE3 is being created out of thin air and this round of quantitative easing is going to be “open-ended” which means that the Federal Reserve is going to keep doing it for as long as they feel like it. But is this really good for the average American on the street? No way. Despite two previous rounds of quantitative easing, median household income has still fallen for four years in a row, the employment rate has not bounced back since the end of the last recession, and new home sales have remained near record lows. So what have the previous rounds of quantitative easing accomplished? Well, they have driven up the prices of financial assets. Those that own stocks have done very well the past couple of years. So who owns stocks? The wealthy do. In fact, 82 percent of all individually held stocks are owned by the wealthiest 5 percent of all Americans. Those that have invested in commodities have also done very nicely in recent years. We have seen gold, silver, oil and agricultural commodities all do very well. But that also means that average Americans are paying more for basic necessities such as food and gasoline. So the first two rounds of quantitative easing made the wealthy even wealthier while causing living standards to fall for all the rest of us. Is there any reason to believe that QE3 will be any different?
Of course not.
This time the Federal Reserve is focused on buying mortgage-backed securities. Yes, the same financial garbage that helped cause the last crisis. The Fed plans to gobble up tens of billions of dollars of that trash every month from now on.
But will the Fed pay true market value for those mortgage-backed securities? If you believe that, I have a bridge to sell you.
So this is going to be a huge windfall for some people, and that does not include us.
Not a single penny of this 40 billion dollars a month will go directly into our hands. The theory is that it will “filter down” to us eventually.
But that hasn’t happened with previous rounds of quantitative easing.
So where does the money go?
A recent CNBC article discussed a very interesting report from the Bank of England about the effects of quantitative easing….
It said that the Bank of England’s policies of quantitative easing – similar to the Fed’s – had benefited mainly the wealthy.
Specifically, it said that its QE program had boosted the value of stocks and bonds by 26 percent, or about $970 billion. It said that about 40 percent of those gains went to the richest 5 percent of British households.
Many said the BOE’s easing added to social anger and unrest. Dhaval Joshi, of BCA Research wrote that “QE cash ends up overwhelmingly in profits, thereby exacerbating already extreme income inequality and the consequent social tensions that arise from it.”
Who benefits from quantitative easing?
According to the Bank of England, it is “mainly the wealthy” who benefit.
As I noted the other day, Donald Trump said essentially the same thing when he told CNBC the following….
“People like me will benefit from this.”
As I already discussed above, a lot of quantitative easing money gets into the financial markets where it pumps up the prices of financial assets.
But not all of it goes there.
We were told that the whole idea behind quantitative easing was that it was supposed to get banks lending again, but this has not happened. Instead, banks are sitting on unprecedented amounts of money. Just look at how the first two rounds of quantitative easing have caused excess reserves being held by banks to explode from close to zero to over 1.5 trillion dollars….
Of course one of the biggest problems is that the Federal Reserve is still paying banks not to lend money.
Yes, you read that correctly.
The Federal Reserve is paying banks to park money with them. So instead of risking their money by lending it out to us, the banks can just park it at the Fed and make risk-free profits for as long as they want.
Must be nice.
If the Federal Reserve really wanted banks to start lending again, all the Fed has to do is to stop paying banks not to lend money.
But of course if more than 1.5 trillion dollars suddenly started flooding into our economy (especially after you consider the multiplier effect) we would be dealing with nightmarish inflation unlike anything we have ever seen before.
So if you want to know why inflation was not even worse after QE1 and QE2 it is because more than a trillion and a half dollars is being parked with the Fed.
So did QE1 and QE2 do any good for average Americans?
Let’s go to the charts.
This first chart shows that the percentage of working age Americans with a job has stayed extremely flat since the end of the last recession.
Does it look like QE1 and QE2 made a difference to you? I don’t see any difference….
Okay, but what about new home sales?
Did QE1 and QE2 help them?
But the mainstream media is still buying the baloney the Fed is pushing.
The mainstream media is promising us that home sales will soon rise and that lots of new jobs are on the way.
Sadly, the truth is that things have steadily gotten worse for average Americans over the past 4 years despite all of the money printing the Fed has been doing. If you doubt this, just read this article.
But this is all that Ben Bernanke seems to have left. When printing money doesn’t work, his answer is to print even more money.
QE3 is likely to cause agricultural commodities and the price of oil to rise even further.
So unless you can convince your employer to give you a corresponding raise, this is going to mean that your paychecks are not going to go as far as they did before.
Higher inflation expectations in the US will filter around the globe. Post the extraordinary steps Ben took yesterday, people will be stocking up on “stuff”. Things like rice, flour, cooking oil, soy, wheat and sugar. If you can eat it, buy it now. It will be more expensive in a month. While your at it, fill up the gas tank, the price is going up next week and every week for the next few months.
In addition, the policy of the Federal Reserve of keeping interest rates as low as possible is absolutely crippling the finances of many retirees. Even the former president of the Federal Reserve Bank of Atlanta, William F. Ford, recognizes this….
One of the overlooked consequences of the Federal Reserve’s recent rounds of monetary stimulus is the adverse impact those policies have had on the interest income of savers. The prolonged and abnormally low interest-rate structure put in place by the Fed has made life particularly difficult for retirees and others who depend on conservative interest-sensitive investments. But the negative effects do not stop there. They spillover into the overall performance of the economy.
Just about everything that the Federal Reserve does these days is bad for ordinary Americans.
But the Fed is not going to stop. The Fed is addicted to money printing now, and as a recent article by Peter Schiff explained, the Fed is just going to “up the dosage” until it gets what it wants….
The Fed will try to conjure a recovery on the backs of currency debasement. It will not stop or alter from this course. If the economy fails to respond to the drugs, Bernanke will simply up the dosage. In fact, he is so convinced we will remain dependent on quantitative easing that he explicitly said he won’t turn off the spigots even if things noticeably improve.
This is complete and total incompetence by Ben Bernanke and his cohorts over at the Fed.
Economist Marc Faber believes that Ben Bernanke should resign, and I agree with him….
“If I had messed up as badly as Bernanke I would for sure resign. The mandate of the Fed to boost asset prices and thereby create wealth is ludicrous — it doesn’t work that way. It’s a temporary boost followed by a crash.”
And yes, a crash is coming.
Bernanke can try to put it off for a while, but every action he takes is just making the eventual crash even worse.
And some in the financial community clearly recognize this. For example, credit rating agency Egan-Jones downgraded the credit rating of the United States to AA- on Friday.
The primary reason they gave for the downgrade was QE3.
Ben Bernanke and the Federal Reserve are destroying the U.S. dollar and destroying our financial system for a short-term economic sugar high.
It is utter insanity.
That is why we desperately need to get the American people educated about the Federal Reserve system. It is at the very heart of our economic problems and yet neither major political party is willing to blame the Fed for the problems that it is causing.
A bunch of unelected bankers that are not accountable to the American people are running our economy into the ground and the American people do not even realize what is happening.
Please share this article with as many people as you can. Hopefully we can get the American people to understand that more money printing is definitely not the solution to our problems.