Real Unemployment / Depression ahead

By , July 14, 2009 6:51 pm

Real Unemployment / Depression ahead I wrote back in January and then again in May and on 25 Jun that this administration would lie and deceive the American People on the actual health of the economy. I stated in January that we would see real unemployment rates of 19 t0 25% by the fall of 2010.Today, summer of 2009, the national unemployment rate is at 9.5 % according to the “official” numbers from the labor department, the labor department works for the Obama administration.Administrations (Democratic and Republican) have economists that will always support the philosophy of their president and are more  than able to make the numbers appear to be what their president wants them to be. I submit to you that the real and actual unemployment rate right now as I write is at no less than 16.5% and I further believe that there are economists out there that would be able to present data to support this. But since these economists are non-partisan; this liberal Congress and President have no use for their opinion or research analysis.It would easy to question my belief that unemployment will be at 19-25% by next fall if today’s rate is only 9.5%; but if it is actually 16.5%, then it is not so farfetched. The unemployment rate in 1929 was 3.2%; in 2007 it was 3.4%. In 1930 it was 8.7, a yearly increase of 5.5 %; in 2008 it was 6.1 (September), a yearly increase of 2.7 %. In 1931 it was 15.9 a two year increase of 12.70 %; in 2009 (July) it is 9.5 (or 16.5), a two year increase of 6.10 (or 13.10) %.Let’s look at it like this: 1929 to 1931 a 12.70% increase in the unemployment rate with the rate at 15.9. 2007 to 2009 a 6.10% (or my real numbers) 13.10% increase in the unemployment rate with the rate at 9.5 (or my numbers of 16.5).It will be interesting to see the numbers next summer to fall time frame to see if I’m right. If I’m right the unemployment rate this time next year will be at no less than 20.8%. In 1932 the unemployment rate was 23.6, a 77% or 20.4 percentage points’ increase in four years from the low in 1929 of 3.2.I wrote back in January that we were facing a depression so severe that it would make the Great Depression of 1929-1934 look like a Boy Scout weekend outing. I still believe that, in spite of the folks in Washington, Wall Street and all the Financial Analysts telling us that we have too many modern day mechanisms in place which never allow another depression like that of 1929. Let’s take a close look at some of those “safe guard” mechanisms: big and powerful financial institutions controlling hundreds of billions of our wealth, they failed; big, powerful, and global insurance companies which would take care of us during hard times and losses, they failed; FDIC, close to insolvency, Government controlled mortgage giants (Fanny MAE/Freddie MAC), they failed; giant auto industry, they failed; the FED, it failed the day it got in bed with the Treasury and our U.S. Constitution is failing when a Congress allows a President  to own auto companies, financial institutions, energy and our health care and that president allows the labor unions to dictate who works, who don’t and that labor union unconstitutionally takes part ownership of companies ahead of contractually secured bond holders.All of the above would not of itself create that severe of a depression, the fact that our government pumped hundreds of billions on these “to big to fail” companies will though  and in fact set up our own government to be “to big to fail”, but who will bail out America. Governments only get bailed out by “future economic progress” but I don’t see that “future economic progress” any time soon and here is why: right now as I write, our national deficit just hit the one trillion dollar mark, the budget is three trillion and the white house just admitted that unemployment will rise to 11% (that would make my number 18%), taxes will be raised not only on the rich, but on average households making $40,000, when more of your money goes to taxes, you buy less and more business will fail, when a business with debt fails, banks fail, when banks fail folks lose their jobs, when more people lose jobs, less money is collected for the treasury so the government has less money to support its people; all this at a time when this President has driven our country into more debt than the last three presidents together; that’s right, Barack Obama has created more government debt in seven months than in the last 20 years.I will continue this line of thought next week, and we haven’t even talked about inflation.

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