scarcity

scarcity

U.S. unemployment soars to 14-year high, over a million jobs lost in the past year.

Patrice Hill reported this in the Washington Times today: (Click here to read her article.)

“Unemployment soared last month to a 14-year high, the Labor Department reported Friday, prompting the head of the panel that officially dates U.S. economic cycles to say there is no doubt that a recession is under way.

Businesses slashed nearly a quarter-million jobs, pushing the unemployment rate to 6.5 percent, the department said. The losses were deep and widespread across nearly every industry from retailing and office work to construction and manufacturing.

Only the health care, education, mining and government sectors avoided the job slaughter and posted modest employment gains.

“The evidence [of a recession] is more than compelling,” Robert Hall, the Stanford University economist who heads the National Bureau of Economic Research’s business-cycle dating committee, told Bloomberg News. “It’s conclusive, in my personal opinion.”

The full committee of eight economists has not officially declared that America is in a recession, however.

The 240,000 jobs eliminated last month came on top of a revised 284,000 job cut in September — far more than originally reported. Together, the figures show how the economy virtually fell off a cliff at the onset of a severe credit crisis that cut off financing for consumers and businesses alike while it caused the failure of a major Wall Street firm and banks in quick succession.

Manufacturers laid off a stunning 90,000 workers, while construction employment fell by another 49,000 and retailers trimmed staff by 38,000.

“We’re in the teeth of recession,” said John Silvia, chief economist at Wachovia Securities. He said the job losses will weigh heavily on consumers, who already have pulled back dramatically from spending in the past two months. And they point to a big drop in the economy in the final quarter of the year.

Harm Bandholz, economist at Unicredit Markets, noted that the job losses in the past two months amount to more than a half-million and bring the job losses for the year so far to more than 1 million – clearly pointing to a profound recession.”

Thomas L. Freidman’s Op-Ed in today’s New York Times, a lucid appraisal of an absurd VP selection for McCain and Justice Oliver Wendell Holmes: “I like paying taxes. With them I buy civilization.”

The following is an Op-Ed piece by ‘From Beirut to Jerusalem’ author, Thomas L. Freidman, published today in the New York Times: (see the original by clicking here.)

Criticizing Sarah Palin is truly shooting fish in a barrel. But given the huge attention she is getting, you can’t just ignore what she has to say. And there was one thing she said in the debate with Joe Biden that really sticks in my craw. It was when she turned to Biden and declared: “You said recently that higher taxes or asking for higher taxes or paying higher taxes is patriotic. In the middle class of America, which is where Todd and I have been all of our lives, that’s not patriotic.”

What an awful statement. Palin defended the government’s $700 billion rescue plan. She defended the surge in Iraq, where her own son is now serving. She defended sending more troops to Afghanistan. And yet, at the same time, she declared that Americans who pay their fair share of taxes to support all those government-led endeavors should not be considered patriotic.

I only wish she had been asked: “Governor Palin, if paying taxes is not considered patriotic in your neighborhood, who is going to pay for the body armor that will protect your son in Iraq? Who is going to pay for the bailout you endorsed? If it isn’t from tax revenues, there are only two ways to pay for those big projects — printing more money or borrowing more money. Do you think borrowing money from China is more patriotic than raising it in taxes from Americans?” That is not putting America first. That is selling America first.

Sorry, I grew up in a very middle-class family in a very middle-class suburb of Minneapolis, and my parents taught me that paying taxes, while certainly no fun, was how we paid for the police and the Army, our public universities and local schools, scientific research and Medicare for the elderly. No one said it better than Justice Oliver Wendell Holmes: “I like paying taxes. With them I buy civilization.”

I can understand someone saying that the government has no business bailing out the financial system, but I can’t understand someone arguing that we should do that but not pay for it with taxes. I can understand someone saying we have no business in Iraq, but I can’t understand someone who advocates staying in Iraq until “victory” declaring that paying taxes to fund that is not patriotic.

How in the world can conservative commentators write with a straight face that this woman should be vice president of the United States? Do these people understand what serious trouble our country is in right now?

We are in the middle of an economic perfect storm, and we don’t know how much worse it’s going to get. People all over the world are hoarding cash, and no bank feels that it can fully trust anyone it is doing business with anywhere in the world. Did you notice that the government of Iceland just seized the country’s second-largest bank and today is begging Russia for a $5 billion loan to stave off “national bankruptcy.” What does that say? It tells you that financial globalization has gone so much farther and faster than regulatory institutions could govern it. Our crisis could bankrupt Iceland! Who knew?

And we have not yet even felt the full economic brunt here. I fear we may be at that moment just before the tsunami hits — when the birds take flight and the insects stop chirping because their acute senses can feel what is coming before humans can. At this moment, only good governance can save us. I am not sure that this crisis will end without every government in every major economy guaranteeing the creditworthiness of every financial institution it regulates. That may be the only way to get lending going again. Organizing something that big and complex will take some really smart governance and seasoned leadership.

Whether or not I agree with John McCain, he is of presidential timber. But putting the country in the position where a total novice like Sarah Palin could be asked to steer us through possibly the most serious economic crisis of our lives is flat out reckless. It is the opposite of conservative.

And please don’t tell me she will hire smart advisers. What happens when her two smartest advisers disagree?

And please also don’t tell me she is an “energy expert.” She is an energy expert exactly the same way the king of Saudi Arabia is an energy expert — by accident of residence. Palin happens to be governor of the Saudi Arabia of America — Alaska — and the only energy expertise she has is the same as the king of Saudi Arabia’s. It’s about how the windfall profits from the oil in their respective kingdoms should be divided between the oil companies and the people.

At least the king of Saudi Arabia, in advocating “drill baby drill,” is serving his country’s interests — by prolonging America’s dependence on oil. My problem with Palin is that she is also serving his country’s interests — by prolonging America’s dependence on oil. That’s not patriotic. Patriotic is offering a plan to build our economy — not by tax cuts or punching more holes in the ground, but by empowering more Americans to work in productive and innovative jobs. If Palin has that kind of a plan, I haven’t heard it.”

‘Google’ the phrase “Cut Workforce,” and “Job loss” Scary results to behold for sure, pray for optimism, God Bless America.

Click here to see News Search results and a long list of recent US company announcements to “Cut Workforce.” SCARY. And SAD. 😦

Click here to ‘google’ job loss to see scary truths and ways of coping.  😐

Chronic pain and depression perpetuate one another, good article from Harvard Mental Health Letter

(This article was first printed in the September 2004 issue of the Harvard Mental Health Letter. For more information or to order, please go to http://www.health.harvard.edu/mental.)The following is an excerpt that sounds very much like my own chronic pain and resulting depression/inability to focus on anything but constant physical pain in my ears mouth and jaw: (Read whole article by clicking  here.)

“…Brain pathways

The convergence of depression and pain is reflected in the circuitry of the nervous system. In the experience of pain, communication between body and brain goes both ways. Normally, the brain diverts signals of physical discomfort so that we can concentrate on the external world. When this shutoff mechanism is impaired, physical sensations, including pain, are more likely to become the center of attention. Brain pathways that handle the reception of pain signals, including the seat of emotions in the limbic region, use some of the same neurotransmitters involved in the regulation of mood, especially serotonin and norepinephrine. When regulation fails, pain is intensified along with sadness, hopelessness, and anxiety. And chronic pain, like chronic depression, can alter the functioning of the nervous system and perpetuate itself.

Read world-renowned Harvard economist, Greg Mankiw’s take on the AIG bailout, here.

World-renowned Harvard Economist, Greg Mankiw, had the following to say about US Taxpayers bailing out international banks and insurance companies on Monday: (see his post in its original format by clicking here.)

More Capital for the Financial System

Doug Elmendorf and Paul Krugman seem to agree that the government should be putting capital into banks and other financial institutions, in exchange for a share of bank equity, rather than using taxpayer dollars to buy bank assets that no one else wants at prices no one else will pay.

See also Sebastian Mallaby, who conveys this proposal:

Raghuram Rajan and Luigi Zingales of the University of Chicago suggest ways to force the banks to raise capital without tapping the taxpayers. First, the government should tell banks to cancel all dividend payments. Banks don’t do that on their own because it would signal weakness; if everyone knows the dividend has been canceled because of a government rule, the signaling issue would be removed. Second, the government should tell all healthy banks to issue new equity. Again, banks resist doing this because they don’t want to signal weakness and they don’t want to dilute existing shareholders. A government order could cut through these obstacles.”

U.S. Central Bank commits US taxpayers to foot 100% of $85 billion AIG bailout, despite the company’s INTERNATIONAL existance and importance (read-bailed out at behest of foreign central banks with only US tax payer money!!??)

Click here to read a Great Opinion Piece  (‘The fleecing of America’) concerning America’s new, diminished role as a pauper nation amongst the world’s new “wealth centers” in China, India, Brazil and the Persian Gulf States and about the lack of foreign investment support in helping to save the international conglomerate AIG (billions in U.S. taxpayer dollars spent to save international company????) Written by Roger Cohen, Published in the New York Times on Sunday, the following is an excerpt:

“…But toxic mortgage-backed securities were pedaled by plenty of foreign banks. And the decision to pour $85 billion of U.S. taxpayers’ money into the rescue of American International Group (A.I.G.), the insurance giant, followed appeals from foreign finance ministers to Henry Paulson, the Treasury secretary, to save a global company.

Representative Barney Frank, Democrat of Massachusetts and chairman of the House Financial Services Committee, told me: “Paulson said he was getting calls from finance ministers all around the world saying, you have to save A.I.G. Well, they should have been asked to contribute to the pot.”

Frank has a point. (He should coach Barack Obama on how to put economics in plain language.) As Frank said on “The Charlie Rose Show,” “I don’t think the European Central Bank should be free to spend the Federal Reserve’s money and not put any in.”

I know, you reap what you sow. Nobody’s itching to help the Bush administration. World central banks did inject billions in concerted action to help stabilize money markets. But the U.S. has essentially been on its own. Now foreign banks with U.S. affiliates will want a slice of the $700 billion bailout. That doesn’t make sense until the burden of this rescue starts reflecting a globalized world.

I asked Frank why Paulson and Ben Bernanke, the Federal Reserve chairman, did not get more foreign support. “I think it’s a perverse pride thing,” he said. “We don’t ask for help. We’re the big, strong father figure. But let’s be realistic: we’re no longer the dominant world power.”

It’s time for a responsibility shift. Call it the Hirst reality check. If he can sell a formaldehyde-pickled sheep with gold horns for millions while Lehman goes under, perhaps it’s time for everyone to help a little when Americans get fleeced.”  😦