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View Diary: First-time unemployment claims soar to 385,000, possibly reflecting early impact from the sequester (92 comments)

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  •  Global economic slowdown as well (12+ / 0-)

    Strange how Americans generally never consider that with most of the industrialized world in recession that it might effect our economy.

    ¡Cállate o despertarás la izquierda! - protest sign in Spain

    by gjohnsit on Thu Apr 04, 2013 at 07:12:06 AM PDT

    •  We had been faring better than most (3+ / 0-)
      Recommended by:
      Fury, MPociask, kefauver

      Thanks to stimulative measures and the Fed, but I guess all the Sequester "victory" dancing came too soon.

      •  Other central banks doing more than the Fed (4+ / 0-)

        The ECB and Bank of Japan are buying bonds at an even faster rate than the Fed. That's why there is talk of a "currency war".

          The fact is that global trade is collapsing. That is going to have an effect on our economy.

        ¡Cállate o despertarás la izquierda! - protest sign in Spain

        by gjohnsit on Thu Apr 04, 2013 at 07:21:57 AM PDT

        [ Parent ]

        •  buying bonds does precious relative little (0+ / 0-)

          to stimulate economies.  The reason is simple, yet most people don't understand it.  Only the Federal Govt deficit can add NEW net financial assets to the economy (as in an entry on someone's ledger that doesn't come with a corresponding entry....that matters....I can explain if someone wishes).  
          Lets walk through the mechanics of the Fed buying already existing bonds.  During QE, the Fed is buying about $80 billion in bonds (both US treasuries and Collateralized mortgage debt=bonds)....the problem is that these bonds have already been purchased with money that is already in the economy.  When the Fed buys these, it simply debits the bond holders securities = bond accounts and credits their reserve = checking accounts.  This is called an asset swap...and its the reason why it doesn't stimulate the economy.  
          Imagine if instead of swapping $3 Trillion worth of already existing bonds....the Govt decided to deficit spend $3 trillion worth of new net financial assets or new money... well, unemployment would be a whole hell of a lot lower than 8%.

          MMT = Reality

          "The Earth is my country and Science my religion" Christiaan Huygens

          by Auburn Parks on Thu Apr 04, 2013 at 05:47:17 PM PDT

          [ Parent ]

    •  Didn't this happen last spring, too? (3+ / 0-)
      Recommended by:
      RJDixon74135, Dr Swig Mcjigger, Fury

      No doubt the sequester is in play, but you have to wonder if there is a seasonal factor, considering we seem to go through this every spring.

    •  Small companies are seeing their cash flow drying (0+ / 0-)

      up. I have friends in small businesses who may go our of business because they are not getting any one to buy their services. One friend, who has a carpet laying business now can only get work for a couple of days a week. Two months ago he was so busy he had to turn away customers.

      Our money system is not what we have been led to believe. The creation of money has been "privatized," or taken over by private money lenders. Thomas Jefferson called them “bold and bankrupt adventurers just pretending to have money.” webofdebt

      by arealniceguy on Thu Apr 04, 2013 at 08:38:36 PM PDT

      [ Parent ]

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