Aside from wondering what the hell the Federal Reserve's done with the entire net worth--and then some--of the United States, there's no longer any need (or, at least, not nearly as much of a need) for speculation about many of the facts relating to our economic downturn and Wall Street's misdeeds, many touched upon herein. Much new information is coming to light now--stunningly, in black and white.
Here are the downright alarming, unpublicized, and less-publicized, truths--the backstory, so to speak--behind Friday's U.S. Department of Labor's Bureau of Labor Statistics' (BLS') Monthly Employment Situation Report for September 2009, along with related, less-publicized facts of late about our economy and Wall Street, in general:
1.)
IT'S NO LONGER JUST THE "WEAKEST JOB MARKET SINCE THE GREAT DEPRESSION;" IT'S NOW, OFFICIALLY, "THE GREATEST NUMBER OF JOB LOSSES SINCE THE GREAT DEPRESSION." We are now, officially, witnessing the greatest percentage of job losses this country's experienced since the Great Depression, per
upcoming revisions to be formally posted by our government in February 2010. (See #2, below.) See the link to this compelling, revised chart, two paragraphs, below (but most recently posted at DKos in its
older format by Meteor Blades, yesterday, in "
Job Losses Far More Than Expected. U6 Hits 17%;" in that FP story, we were reminded that it's the: "
Weakest employment market since the Great Depression").
But, here's the update, this time with with the Bureau of Labor Statistics' Annual Benchmark Revision included in it, highlighting this snowballing employment/unemployment story, now posted at Calculated Risk, which demonstrates, officially, that we're now in an unemployment cycle which includes the greatest number of job losses since the Great Depression, too: "Comparing Employment Recessions Including Revision."
An absolute must see chart revision is available here via a click on this link, right HERE, for my vote (as I've stated even before it was revised, today) for the most compelling chart of the year...by far, but now it's updated.
The truth (as you'll see in #3, below) is that--based upon statistical data provide in yesterday's BLS' "Employment Situation Report"--sectors of our society are already experiencing joblessness as bad, if not worse, than some of the worst unemployment statistics realized during the Great Depression, too.
2.) SEPTEMBER'S EMPLOYMENT REPORT, DELIVERED YESTERDAY, INCLUDED STUNNING "ANNUAL BENCHMARK REVISIONS," DEMONSTRATING AN UNDERCOUNTING OF UNEMPLOYMENT BY 15%, BURIED BENEATH THE FOOTNOTES OF THE STANDARD, MONTHLY REPORTS. This new information, just being reported upon, extensively (now, a day later), is nothing short of stunning with regard to its implications. Here's the link to it, but you have to scroll far down, past the standard Monthly Employment Situation Report, to access it: right HERE.
From our government:
Preliminary Estimates of Benchmark Revisions to the Establishment Survey
In accordance with usual practice, the U.S. Bureau of Labor Statistics is announcing its preliminary estimates of the upcoming annual benchmark revision to the establishment survey employment series. The final benchmark revision will be issued on February 5, 2010, with the publication of the January 2010 Employment Situation news release.
Each year, the Current Employment Statistics (CES) survey employment estimates are benchmarked to comprehensive counts of employment for the month of March. These counts are derived from state unemployment insurance tax records that nearly all employers are required to file. For national CES employment series, the annual benchmark revisions over the last 10 years have averaged plus or minus two-tenths of one percent of total nonfarm employment. The preliminary estimate of the benchmark revision indicates a downward adjustment to March 2009 total nonfarm employment of 824,000 (0.6 percent).
Table B shows the March 2009 preliminary benchmark revisions by major industry sector. As is typically the case, many of the individual industry series show larger percentage revisions than the total nonfarm series, primarily because statistical sampling error is greater at more detailed levels than at a total level.
Bold type is diarist's emphasis.
In case you were wondering, what this means is we should add 824,000 more jobless to our nation's unemployment lists, with the lion's share of those numbers being posted in the first quarter of this year.
3.) THE TRUTH: IT IS, ALREADY, A BRUTAL DEPRESSION FOR MUCH OF THE U.S. AND THOSE TRUTHS ARE PROJECTED TO GET WORSE, NOT BETTER. Generally speaking, the numbers from yesterday's BLS' U.3 Index calculations, noted in the blockquote, immediately below, may be doubled, easily and without exaggeration, to account for those actually unemployed and underemployed. (For more on these new realities, see #6 and #10, below.) Again, the link to all of this is right HERE:
Household Survey Data
Since the start of the recession in December 2007, the number of unemployed
persons has increased by 7.6 million to 15.1 million, and the unemployment
rate has doubled to 9.8 percent. (See table A-1.)
Unemployment rates for the major worker groups--adult men (10.3 percent),
adult women (7.8 percent), teenagers (25.9 percent), whites (9.0 percent),
blacks (15.4 percent), and Hispanics (12.7 percent)--showed little change
in September. The unemployment rate for Asians was 7.4 percent, not season-
ally adjusted. The rates for all major worker groups are much higher than
at the start of the recession. (See tables A-1, A-2, and A-3.)
Among the unemployed, the number of job losers and persons who completed
temporary jobs rose by 603,000 to 10.4 million in September. The number of
long-term unemployed (those jobless for 27 weeks and over) rose by 450,000
to 5.4 million. In September, 35.6 percent of unemployed persons were job-
less for 27 weeks or more. (See tables A-8 and A-9.)
The civilian labor force participation rate declined by 0.3 percentage point
in September to 65.2 percent. The employment-population ratio, at 58.8 per-
cent, also declined over the month and has decreased by 3.9 percentage points
since the recession began in December 2007. (See table A-1.)
Bold type is diarist's emphasis.
As you'll see, and as supported in #6 and #10, below, one may easily double these percentages to arrive at just conservative estimates of true unemployment and underemployment.
At the height of the Great Depression overall unemployment was estimated to be roughly 25%-30%.
Doubling the U.3 unemployment numbers, highlighted in the paragraph from the blockquote above, we arrive at the following stats:
Adult Men: 20.6%
Adult Women: 15.6%
Teenagers: 51.8%
Whites: 18.0%
Blacks: 30.8%
Hispanics: 25.4%
Asians: 14.8%
It's interesting to note that unemployment information from the 1930's--what little of it that's available--included teenagers, 16 and older.
Of couse, unemployment projections, as most recently noted in the press, anticipate rising unemployment through all or part of 2010. So, these numbers, above, should get worse in the near future, not better.
4.) IT'S NOW "OFFICIAL." FOR THE FIRST TIME IN STATISTICAL HISTORY, STANDARD GOVERNMENT UNEMPLOYMENT BENEFITS ARE INSUFFICIENT. For the first time in the history of the Bureau of Labor Statistics' reporting, the official numbers tell us standard employment benefits no longer cover the average amount of time a typically unemployed person is without a job (From Bloomberg: "U.S. Unemployment Now Lasts Longer Than Benefits: Chart of Day"): "...the average amount of time it takes fired employees to find a new job exceeds the length of their standard unemployment benefits."
Of course, we now know that doesn't even begin to describe the half of it, since the public is already exhausting unemployment benefits at record rates. Looking on the bright side of things--as if there was one--our government is continuing to extend unemployment benefits for many, but this resolves only a portion of the problem, and then only for a very limited time, at best.
5.) THE WELL-NOTED "REVOLVING DOOR" AND DIRECT INFORMATION LINKS/LEAKS BETWEEN OUR GOVERNMENT AND WALL STREET (NOW UNQUESTIONABLY DOMINATED BY GOLDMAN SACHS) ARE, ONCE AGAIN, BEING CALLED INTO QUESTION AS A BYPRODUCT OF THE PUBLICATION OF THE LATEST BLS' MONTHLY EMPLOYMENT SITUATION REPORT. Here's the story from Matt Taibbi's favorite blog (apart from his own), Zero Hedge: "Non farm Payroll Number Collapses, Goldman Last Minute Adjustment Right On Money As Usual."
Where to start here: A horrendous September NFP number coming in at -263,000 versus -175,000 consensus; numerous prior period revisions, demonstrating just how clueless the BLS is in this volatile environment; unemployment at a 25 year record 9.8%; a once again dropping work week (33 hours vs. 33.1 prior), slowing growth in average hourly earnings at 0.1% vs. 0.4% in August, or, most relevantly, how on Earth did Goldman know to increase its NFP estimates by 25% less than 24 hours ago, to a number so much more aligned with reality: does Jan Hatzius have a direct, unrecorded line to a BLS "janitor"? Or does he just like keeping his clients in suspense until the 11th hour on what the truth really is? Inquiring minds want to know.
Here's more on the story: "Goldman's "Advance" Look On Payroll: Look Out Below."
There was a time when people were fired or prosecuted (remember Martha Stewart?), at least once in a very blue moon, for disseminating insider information. Here, we're reminded, once again, that the Masters of the Universe are not like us little people.
6.) OVER THE PAST FEW DAYS, THE LEADERS OF OUR COUNTRY'S ECONOMY ARE STARTING TO GET MORE REALITY-BASED IN THEIR COMMENTS ABOUT THIS, TOO. Then again, these comments from Federal Reserve Chair Ben Bernanke were made just 18-20 hours before the release of the government's latest "Employment Situation Report," so, perhaps, he knew he'd look pretty lame if he didn't speak up beforehand. I covered the tip of this iceberg, on Thursday, in a diary, linked here: "Bernanke: Jobless Rate May Stay This Bad Until 2011." And, here's Ben: "Bernanke Says Jobless Rate May Be Above 9% at End of Next Year."
Bernanke Says Jobless Rate May Be Above 9% at End of Next Year
By Scott Lanman
Oct. 1 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke said U.S. economic growth next year probably won't be strong enough to "substantially" bring down the jobless rate, which may remain above 9 percent at the end of 2010.
"Most forecasters including the Fed are currently looking at growth in 2010, but not growth so rapid as to substantially lower the unemployment rate," Bernanke said in response to questions at a House Financial Services Committee hearing today in Washington. Growth of 3 percent means the rate would "still probably be above 9 percent by the end of 2010," Bernanke said.
Once again, evidence that "the story" is to the point where it's getting ahead of those narrating it--or should I say: "...navigating it for us?"--in D.C.
7.) POVERTY IS DRAMATICALLY INCREASING IN THIS COUNTRY, THIS YEAR, NO MATTER HOW YOU LOOK AT IT. While the government is now, finally, acknowledging something that's been common knowledge for quite awhile, the facts are that millions are scheduled to exhaust their unemployment benefits long before the employment situation improves. As a result, to say that poverty's increasing would be an understatement. Hundreds of thousands of people--those not living in states with additional federal unemployment benefits potentially set to be implemented--are falling off the charts each month. Even now, with new unemployment claims sporadically (supposedly) diminishing, slightly, on a month-over-month basis, the numbers are, still, far worse than the worst months of the past few "recessions."
Go to the charts, linked HERE, and choose the "ALL STATES" option at the top of the list. Then look at the numbers on the far left and far right columns. They're pretty devastating statistics, IMHO, all by themselves. (If you want to checkout the situation in your own state, just select that option, instead.)
But, media coverage of the recently-observed growth in U.S. poverty levels is increasing, too: "US income gap widens as poor take hit in recession." (NOTE: There are many other stories that have appeared in the past month, but I think I've provided enough links throughout this diary to account for this. I'm leaving out our realities about: housing (with 7,000,000 homes yet to hit the foreclosure lists, and over 48% of the homeowning population already having been projected by Deutschebank and Barclay's to be underwater by the end of 2010), consumer debt, consumer spending, the reality that there are fewer jobs in this country than there were in 1997, increasing evidence of deflation, and so forth...but it is all there, on the record.
8.) U.S. MANUFACTURING--WHAT'S LEFT OF IT--IS IN A REALLY BAD STATE OF AFFAIRS, AND SUMMERTIME COMMENTS IN THE PRESS REGARDING A SLIGHT IMPROVEMENT IN HIGHLY-NEGATIVE, LONG-TERM STATS ARE QUICKLY BEING BLOWN OUT BY THE LATEST REPORTS, ESPECIALLY OVER THE PAST FEW DAYS. Even those known for spinning these numbers are having a bit of a tough time sugar-coating our latest economic realities: "U.S. Economy: Manufacturing Grows at Slower Pace, Claims Rise."
...Unexpected Drop
The ISM index, which dropped for the first time this year, was forecast to rise to 54, according to the median of 80 estimates in a Bloomberg survey of economists. Projections ranged from 51.5 to 56. Manufacturing accounts for about 12 percent of the world's largest economy.
"We're still in positive territory but we're just not advancing at quite the same rate," said Brian Bethune, chief financial economist at IHS Global Insight in Lexington, Massachusetts. "Retailers are anticipating a weak sales season and they're playing it conservative on orders and hiring."
The ISM report showed orders and production advanced at a slower pace last month, while the magnitude of reductions in inventories also cooled.
"The inventory correction, with the exception of a few industries," has played out, Norbert Ore, chairman of the ISM's factory survey, said in a press conference. "Overall, September was a good month. For the balance of the year, we should expect to see manufacturing holding this level, possibly improving from this level."
Then there are much more harsh, reality-based manufacturing reports, such as this: "August Steel Imports Plunge 76% Annually, Hit Another Recent Record Low."
Yet another indication of just how dismal the economy is, was the recently announced non-existent demand for raw material imports, particularly steel, which saw was a mere 775k tons in August imports, a 66.5% decline from August of 2008, or a dollar value of $758 million down 76% from the $3.2 billion imported in August 2008. After a brief "second derivative" headfake in July numbers, the August results indicate that even as economists expect a massive pick up in inventories and what not, domestically America is using raw materials at a fraction of even 2008's run rate.
How this information will affect steel makers and service centers is as of yet unknown, although with destocking already having been occurring for many months, the complete lack of any tangible desire to restock is truly surprising.
Obviously, this last quote is about imported steel, but compared to generation's past, very little steel is now manufactured in the U.S. And, what we import is used in manufacturing and construction. With steel imports off 76% in just one year, that kind of says a lot, all by itself. IMHO, it's an amazing statistic.
But, let's look at another manufacturing-related story from the past few days: "U.S. Aug. durable-goods orders tumble 2.4%." Very simply, with the stimulus kicking in, it was not supposed to be playing out like this:
U.S. Aug. durable-goods orders tumble 2.4%
By Rex Nutting
Sept. 25, 2009, 8:30 a.m. EDT
WASHINGTON (MarketWatch) -- The recovery in the manufacturing sector stumbled in August, as a big decline in orders for new airplanes pushed total durable goods orders down 2.4%, the largest decline since January, the Commerce Department reported Friday. The 42% drop in orders for civilian aircraft accounted for most of the decline. Weaker demand wasn't confined to the aircraft sector, however. Excluding the 9.3% drop in transportation orders, orders were flat in August, the weakest showing since April. Economists surveyed by MarketWatch were anticipating a 0.7% gain in total orders.
9.) THE REAL STORY'S FINALLY GETTING OUT. As they say, "recognizing the problem is half the solution;" and, while it may now be over a year since the markets exploded and the commercial and investment banks collapsed, some of the best analysis of it all is, finally, coming to the fore. Here are a couple of my picks for outstanding commentary, just over the past 72 hours--as the real story gains traction--with the first providing us with links to lengthy lists of dozens of of respected economists that underscore much of what you've been reading in this diary:
See George Washington's guest post on Naked Capitalism, from today: "The Real Reason the Giant, Insolvent Banks Aren't Being Broken Up."
With greater clarity now being provided with regard to how Wall Street--not Main Street--got us into this mess, in the first place. From former Goldman Sachs' executive Naomi Prins' (prelim to her book) post from Alternet.org: "Wall Street Lies Blame Victims to Avoid Responsibility for Financial Meltdown."
And, IMHO, here's the truth from a couple of weeks ago, from Nobel laureate Joe Stiglitz, ahead of the crowd, as usual: "Stiglitz Blasts Goldman; No Real Recovery Til 2012 Or Later."
10.) SPEAKING OF THE "REAL STORY," HERE'S SOME FASCINATING QUALITATIVE ANALYSIS FROM REAGAN ADMINISTRATION FORMER ASSISTANT TREASURY SECRETARY, PAUL CRAIG LEWIS. (In and of itself, this is somewhat of a story!)
If I say so, myself, when one of Ronald Reagan's Assistant Treasury Secretaries says things like this, it really is notable. I would suggest that you read for Ass't Treasury Secretary Roberts' entire post. It is compelling. "The Economy Is A Lie."
The Economy Is A Lie
by Paul Craig Roberts
Global Research, September 22, 2009
Information Clearing House - 2009-09-21
Americans cannot get any truth out of their government about anything, the economy included. Americans are being driven into the ground economically, with one million school children now homeless, while Federal Reserve chairman Ben Bernanke announces that the recession is over.
The spin that masquerades as news is becoming more delusional. Consumer spending is 70% of the US economy. It is the driving force, and it has been shut down. Except for the super rich, there has been no growth in consumer incomes in the 21st century. Statistician John Williams of shadowstats.com reports that real household income has never recovered its pre-2001 peak.
--SNIP--
The rest of America is suffering terribly.
The unemployment rate, as reported, is a fiction and has been since the Clinton administration. The unemployment rate does not include jobless Americans who have been unemployed for more than a year and have given up on finding work. The reported 10% unemployment rate is understated by the millions of Americans who are suffering long-term unemployment and are no longer counted as unemployed. As each month passes, unemployed Americans drop off the unemployment role due to nothing except the passing of time.
The inflation rate, especially "core inflation," is another fiction. "Core inflation" does not include food and energy, two of Americans' biggest budget items. The Consumer Price Index (CPI) assumes, ever since the Boskin Commission during the Clinton administration, that if prices of items go up consumers substitute cheaper items. This is certainly the case, but this way of measuring inflation means that the CPI is no longer comparable to past years, because the basket of goods in the index is variable...
--SNIP--
If measured according to the methodology used when I was Assistant Secretary of the Treasury, the unemployment rate today in the US is above 20%. Moreover, there is no obvious way of reducing it. There are no factories, with work forces temporarily laid off by high interest rates, waiting for a lower interest rate policy to call their workforces back into production...
So, there you have it...practically from the horse's mouth...a former Reagan administration Assistant Treasury Secretary telling us, flat out, that if the unemployment rate was measured using the methodology used when he was in D.C., it would be above 20%.
So much for all those ridiculously twisted unemployment numbers we've been hearing in the MSM. The truth is comparisons between numbers spun today and numbers used just a few decades ago to measure our economy, on many fronts, are little more than pure unadulterated bullshit.
Things are significantly worse than we're being told by our government, and the story's simply getting ahead of both our government in D.C. and the corporatist MSM.
We have reached a tipping point, IMHO. But, where we go from here remains to be seen...
IN CLOSING...SOME REAL HOPE FROM A "GLOOM AND DOOMER"...
I'm going to say something that I hope is not misinterpreted by this community and it's this: As a small business owner of a software company that enables Main Street retailers and service-providers to enable their customers to better finance their purchases, I'm on the front lines of the economic downturn, everyday.
But, I'm also making these comments as someone with 30 years of professional Democratic campaign media and communications experience. (This experience included having the privilege to have worked with many of the more prominent candidates, elected officials and behind-the-scenes movers and shakers in our party over the past generation, including one or two of the most senior folks that were responsible for managing the media in last year's national election, as well.)
For over a year, it's been apparent to yours truly that it's much worse out in the trenches than the MSM has been conveying to the public. (No surprise there.) But, far worse than those realities is the truth that--also for quite awhile, but I'm not going to start in with my extensive citations of these facts since I've been posting about these truths for a very long time--many people have been engaged in downright distortion of these truths, too.
The level of suffering, regrettably, had to reach a point where the MSM, and now our government, was compelled to report on the true extent of it. I truly hope this effort intensifies in coming days, weeks and months. This Depression 2.0/Great Recession, as they say, "is gonna' leave a mark" on our society for decades, if not generations.
So, in a rather perverse way, this negative news is both welcome and long overdue. The truth is the facts are trumping the happy news spin, and when that happens, those doing the spinning--including our own government--lose credibility (and VOTES). Given the extent of regulatory capture in this country, true reform is brutally difficult, at best. But, without the reality of the true extent of the suffering on Main Street being front and center in the news cycle, efforts to ameliorate these problems there (i.e.: increased stimulus, etc.) will fall on deaf ears.
There's a glimmer of hope here in all of this, since from it all will come the real "change we can believe in."
Reality will force that to happen if these truths are at the forefront of the news cycle in coming weeks and months, too. That effort, combined with a constant, ongoing reminder that it was eight years of Republican, laissez-faire mismanagement of our nation's economy that has brought us to the position we're in, now, should be more than sufficient to see us through both the mid-terms next year and the 2012 national elections, as well.
It worked for FDR in 1936, when this country was in the midst of the worst economic downturn in its history. Then again, FDR didn't have a totally out-of-control status quo, t.v., 427's, 501(c)3's and 4's, soft money, and a Supreme Court overturning the very purpose of campaign finance regulations, either!
But, these obstacles may be overcome. We thought--before many came to the realization that the obstacles to real change were far more ingrained, institutionalized and obfuscated within our society than many now realize--we did this last November.
You see, to a great extent, we have truth on our side. (Yes, I realize it's far from compelling truth, since Democratic leadership also let us get to the point where we're at now; but, stating the obvious, for the previous eight years, we were not in charge. Reminding the public of this--a public that doesn't remember what it had for dinner the previous night--is a good and quite necessary thing, too. Basic facts really are all that's needed, starting with a blunt reminder that we've just been through a decade without job or household income gains.)
At that point, we may then be fully empowered to make real change our reality.
But, it'll still be up to us to make it so.
# # #
A MUST READ....
Slightly OT but a MUST-READ, IMHO: (h/t to Yves at Naked Capitalism.) It just wouldn't be fair if I didn't leave you with this ever-so-slightly-off-topic gem! I'm still laughing my ass off over it, from Rude Pundit: "Rep. Alan Grayson May Just Fuck Your Shit Up." Posted by Rude One, here's the last sentence of his commentary...ROFLMAO!!!
...Grayson just pointed out that motherfuckers fuck their mothers. It's that simple.
MORE KUDOS TO VETS74....AND TIME MAGAZINE TELLS US: TINFOIL HATS NOT REQUIRED
To Vets74 for his latest diary here (See: "1,000 Companies Attacked--1,200,000 Jobs Destroyed")
being noted as a link (i.e.: "top read") over at the highly-regarded and well read Naked Capitalism website, as well!
You see, as Time Magazine's Justin Fox now tells us, you really may take off your tinfoil hat and readily observe that there are almost countless, real conspiracies playing out everyday on Wall Street: "Time Magazine's Justin Fox: 'Some Financial Market Conspiracies Are Real'."
Just a few months ago, who woulda' thunk this story would've even seen the light of day?