If This Is a Recovery...

No one goes into Wal-Mart (WMT) and asks to pay extra sales tax. Thus sales taxes are reasonable barometers for retail sales. This week we look at how taxes are doing in a period of economic recovery. Then we turn our eyes to a very interesting (and sobering) analysis of possible future unemployment rates. This is an anecdote to the happy-face analysis of employment numbers you get from establishment economists. There will be a lot of charts and tables, but I think readers will find it very interesting.

If This is Recovery, Where Are the Taxes?

I keep reading about surveys that show that retail sales are up. But as noted above, no one pays extra sales taxes, or decides they need to pay more income taxes. The surest way to measure retail sales is sales taxes. Want to know how incomes are doing? Look at income tax receipts. Let's look at sales taxes first.

First off, I can find no single source of recent sales tax information. It is all one-off, but it is consistent. Sales taxes in my home state of Texas are down 12.8% year-over-year, and we're in the fifth straight month of decreases of 11% or more. Projections are for sales taxes to continue to decline into 2010.

There is a very revealing study by the Pew Center on state taxes, called "Beyond California". Everyone knows how badly off California is. The Pew Center looks at how the rest of the states are doing, and focuses on 10 states that also have severe problems. Sales tax receipts are down 14% in Arizona, and state income taxes are down 32%.

On average, revenues are down almost 12%. Oregon has seen their revenues collapse a stunning 19%. New York is down 17%, with a deficit of 32%. Illinois has a projected deficit of 47% of its budget, second only to California with 49%. You can see how your state fares here.

The Liscio Report notes that all states had negative year-over-year sales tax collections in October, and the weighted average decrease was 10.2%, down from a negative 7.2% in September.

Sales at Wal-Mart stores slipped by 0.4% in the third quarter. Actual government figures show that retail sales were down 1.5% in September from the previous month and 5.8% year-over-year. So how do we keep seeing headlines about retail sales being up, as unemployment keeps rising?

Remember that such reports are usually based on surveys, and generally cover mid-sized and up retailers, leaving out smaller businesses. Further, if you are a retail chain that has closed 10% of its stores, the remaining stores should in theory benefit from getting your loyal customers into them.

Last Business Standing

Yesterday I was with an associate, and I hesitated in asking them how their business was doing, because I knew things had been tough at the beginning of the year. But I did ask, and they said sales were up over the last months and business was looking better. Surprised, I asked them what made the difference. "Ah," they said, "less competition. Our competitors have gone out of business."

Best Buy (BBY) and other electronic retailers had to benefit from Circuit City disappearing. That is Schumpeter's creative destruction at work. Not very good for total employment, but it does help the profitability of the survivors.

So, if things are so bad, how did we have 3.5% growth in the third quarter? First off, things are not as bad as they were in the past year. We are in fact getting close to an economic bottom, at least for now. Second, the 3.5% number is a preliminary estimate. A study by Goldman Sachs (GS) suggests that the number will be revised down by at least 0.5% and maybe as much as 1%.

Why? The estimate does not really take into account how poorly small businesses are performing. If you look at small-business indexes and compare them to historical GDP numbers, you get the smaller number mentioned above. And since at least 2% of the GDP was from the stimulus package (Cash for Clunkers, houses, tax cuts), the economy on its own was flat. That begs the question, what happens when the stimulus runs out?

And the answer is that we won't know for some time, as the stimulus is just getting ramped up.

"According to CBO estimates, only 21% of [the stimulus] spending will occur in 2009; another 38% will come in 2010, and 22% in 2011. After that, its effect will dissipate quickly." (The Liscio Report)

But David Rosenberg notes that what the federal government is giving, the states are taking away. The Pew Study shows that at least nine other states are in appalling shape, so it is no wonder that David writes:

Stimulus, What Stimulus?

"Fully nine states are in fiscal distress and only two have balanced budgets. States like Michigan are planning 20% budget cuts for the coming year. Indiana is planning a 10% spending cut in light of a 7.4% YoY revenue decline. How can the economy really be out of recession if government revenues are still deflating?

"The states are filling around 40% of their fiscal gaps with the federal stimulus (so much for spending on "shovel ready" infrastructure projects). Even after the fiscal help from Washington, the state governments will still face a projected deficit of $142 billion for 2011 (versus $113 billion in 2010). All in, the restraint in the state and local government sector is estimated to drain a full percentage point from U.S. GDP growth in 2010 and more than fully offset the stimulative efforts from Washington. The U.S. economy is more likely to post growth of little more than 2% next year, rather than the 5% currently being discounted by the equity market."

The Reality of Unemployment

All this is, of course, going to put continued pressure on employment. As I noted last week, the number of unemployed actually soared by 558,000, to 15.7 million, as measured by the household survey, not the 190,000 you read about in the mainstream media. Unemployment is sadly continuing to rise by significant amounts.

In August, I did an interview with CNBC from Leen's Fishing Lodge in Maine. The unemployment numbers had just come out. I did a back-of-the-napkin estimate that we would need about 15 million new jobs over the next five years just to get back to where we were when the recession started.

That works out to a need for about 125,000 new jobs each month to handle new workers coming into the market (which comes to a total of 7.5 million over five years), plus the 8 million and rising jobs we've lost. That is a daunting number. It amounts to 250,000 new jobs a month every month for five years. And we are still losing more than that number a month, let alone adding the needed 250,000.

Look at the chart below (click to enlarge). It shows the establishment survey employment figures for the last ten years. Only once, in 1999, did we actually add over 250,000 jobs a month for a whole year. And that was during the internet boom.

Sadly, the private sector has shed over 300,000 jobs since 1999. Think about that. We have had a decade where there have been no new jobs added by the private sector. Real incomes are roughly where they were, and the stock market is down. Talk about a lost decade.

I love it when someone does the really heavy lifting for me, and my friend Mike Shedlock of Sitka Pacific Capital Management has done a wonderful job of taking that speculation of mine and putting it into a spreadsheet that helps us get a real handle on what unemployment is likely to look like for the next ten years. I am going to make use of his basic analysis and then modify some of his assumptions in the spreadsheet he provided me, in order to think about different scenarios.

All three scenarios are based on assumptions, so let's see what Mish started with. There is a wealth of data available from the Bureau of Labor Statistics and the Census Bureau. According to the Census Bureau Population Estimates we are going to add about 2.5 million working-age (16 years old and up) citizens a year, from now until 2020. The numbers varies slightly year to year. Mish used an estimate of the average, summing up the buckets from 16 to 100+ for the years in question and rounding the result.

You can go to the BLS site and look at Table A-1, which shows the civilian noninstitutional population (those over 16 not in prisons), the participation rate (those who are working and/or want to work), the unemployment rate, the number employed, those not in the labor force, and those who want a job. Those are starting numbers for the charts below.

For those interested, you can read Mish's very full (and quite detailed) analysis at his blog site. But let's look at his assumptions:

• Job losses are likely to continue for a minimum of another year.
• When job gains start, they will be very slow at first, then pick up.
• An extremely generous monthly job gain stat over the course of the year would be 150,000 jobs.
• A falling participation rate (boomers retiring) will continue to mask reported unemployment.
• Starting in 2013 the labor pool will start decreasing because of Boomer demographics.
• The noninstitutional population will rise by 2.5 million workers a year.

The spreadsheet below (click to enlarge) needs a little explanation. Let's start with the assumptions. Mike starts with current working-age population and adds 2.5 million people a year. He assumes that Boomers will retire at 65 (something which all the surveys say is not going to happen). And his last estimate is what the unemployment numbers will be. Everything else is based on those assumptions, which leads to the first column, or the expected unemployment number.

By the way, we know that everyone will want to make different assumptions. I am going to create three scenarios, but you can go to Mike's blog and at the bottom of the post is a link to the actual spreadsheet. Have fun. Let's look at scenario 1.

This assumes there is no double-dip recession, and jobs roughly rise along the same lines as the last recovery. Actually, Mish is far more optimistic, as in the very first chart you will notice that job losses were negative in the first year after the end of the recession and flat the second year. Mish has jobs rising by 120,000 next year and 600,000 the second year (2011), and then a fairly robust recovery. Below is the graph of the unemployment numbers under such a scenario.

Notice that unemployment stays at or above 11% for three years. Pessimistic? Mainstream and usually very optimistic Mark Zandi predicted this week that unemployment would rise to 11% by the middle of next year, right in line with this scenario. Also note that total jobs rise by 14 million over ten years. Hardly doom and gloom. Again, Boomers all retire on time and there is no double-dip recession.

Let the Good Times Roll

What would it take to get back to 5% unemployment? I played with the spreadsheet and came up with the following numbers, which get us below 5% by 2020. I assume no recessions for the next ten years, and 2 million new jobs a year after 2011, which I start off with almost 1.5 million jobs. Of course, we have never done that, but let's be optimistic (click to enlarge).

And the graph below shows the unemployment numbers for the Good Times Scenario.

Want to get to 5% within five years? Add 3 million jobs a year starting now. With no housing recovery, a smaller auto industry, and financial firms getting leaner.

The Quick Double-Dip Scenario

When I called the last two recessions about a year before they happened, it was not all that hard. We had inverted yield curves, falling leading indicators, and a lot of other data that pretty much pointed to a recession. Believing that we had a housing bubble and a looming credit crisis also helped my conviction in calling the last recession.

I think we are in for a double-dip recession in 2011, yet I readily admit there will be little if any statistical evidence in advance this time. This is more of an instinct call. I have serious doubts that we can have what amounts to the largest tax increase of all time in what will be a very weak (albeit growing) economy, without putting us back into recession. And Speaker Pelosi thinks it is a smart thing to add another 5.4% surtax on what will already be a rising capital gains and dividend tax.

Taxing small businesses, and that is what the tax increase amounts to, is a very bad idea in a weak economy. Small businesses are where the job growth comes from. Taking money from productive businesses and giving it to government is a fundamentally flawed concept.

Now, if they decide to postpone the tax increase, or phase it in slowly, then maybe we avoid the double dip. But right now it doesn't look like that will be the case. So, let's quickly see what a double-dip scenario might look like. Let's be optimistic and assume we only lose another 1.2 million jobs in the next recession, since we have already lost so many in this one (8 million and counting). And then the economy comes roaring back in 2012 with 1.5 million jobs and continues to grow rather smartly for the rest of the decade. No further recession. We absorb the tax increases and move on with our economic lives.

Unemployment under such a scenario would rise to just under 13% and stay above 10% for 8 years. Take a look at the chart and graph (click to enlarge).

Think 13% is too dire? This week David Rosenberg said unemployment would rise to between 12-13%. The former Merrill Lynch economist was one of the few mainstream economists who called the recession and the credit crisis. The so-called "Blue Chip" economists told us at the beginning of 2008 that unemployment would peak out at 6%. While Rosie is not optimistic of late, he has a rather solid record of being right.

We are at 10.2% unemployment today. The economy lost jobs for 21 months after the end of the last recession. That would easily take us into 2011. Another million lost jobs will take us well over 11% and close to 12% (remember, you have to add in the increasing population), even without my double-dip scenario.

This letter is getting long and it's getting late, so let me close with a few thoughts.

First, 12% unemployment is horrendous by American standards. But Spain is now at 20%, and much of Europe has been in the 10% range for years.

Second, Americans are not used to the concept of 12% unemployment or 10% rates for extended periods. That is going to cause a serious backlash across the political spectrum. Couple that with the discomfort over $1.5-trillion deficits and there could be some serious political changes in the coming years. I think the message will be more anti-incumbent than one party or the other.

Third, the only way out of this morass is to create an environment where small business can thrive. As I've noted for the last several weeks in this letter, government spending does not increase GDP over time. It is a temporary nonproductive stimulus. It takes private investment to create jobs and increase productivity. Over the next few months, I will write more about how to do that.

Author's Disclaimer:

John Mauldin is president of Millennium Wave Advidufsors, LLC, a registered investment advisor. All material presented herein is believed to be reliable but we cannot attest to its accuracy. Investment recommendations may change and readers are urged to check with their investment counselors before making any investment decisions.

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Comments

[j-dub]

So, from the information I've gathered so far, we will be in a:
jobless, homeless, incomeless, debt ridden, currency appreciationless, recoveryless recovery.

GO USA


(on an anecdotal note, I was attending an MBA information session here in Florida, when the second speaker got up to talk. Talking about job opportunities in this economy, I have never seen a more obvious hatred towards ones own spin when she said,"As we recover.........."
Her eyes rolled so much they almost fell right out of their sockets and she lingered on the word recover as if to say,"Who am I kidding?"
Pretty telling)

2009 Nov 15 05:11 AM

[very rare]

As far as the taxes issue, how much is bought on the internet where there is basically no sales tax. (I know because I shop there a lot) Even if they taxed the internet sales, I still would save money not driving my car to shop plus, I can shop the whole world from my recliner. Tax (sales tax) from where the buyers base is from. How difficult is that? All online stores need to know where the money will come from. Even Paypal has to know where you live to OK payment.

2009 Nov 15 08:21 AM

[bbro]

We will get positive job growth in 2 to 3 months.....the ratio of non farms to jobless claims turned up in March 2009, it brokes its 12 month moving average in August 2009...going up. and the 12 month
moving average will turn up in 2 months. When this 12 month moving
average turns up we will get job growth. The ISM non manufacturing business
activity index 3 month moving average projects job growth within several months. As much as Mr. Mauldin's Texas Republican politics is a part of his economic opinion the stimulus has paid out 206 billion in tax cuts.grants.and loans. There is another 379 billion to go in Fiscal year October 2009 to October 2010.

Oh yeah I know Rosenberg predicted the current crisis but he has
also notorious incorrect predictions too.

2009 Nov 15 08:57 AM

[bbro]

David Rosenberg said the S&P 500 was going to 600 By October 2009.....

2009 Nov 15 09:02 AM

[ari5000]

Priced in gold, David Rosenberg's prediction of 600 by Oct. 2009 is not that far off...

2009 Nov 15 10:05 AM

[Alphameister]

I think you wanted "antidote," not "anecdote" in your first paragraph, John, but otherwise an excellent warning of the economic challenges we face. Consumer sentiment took a big drop recently and there is a reasonably good correlation historically between consumer sentiment and stock prices.

You talk about fiscal stimulus coming to an end in 2011, but I see an almost certain succession of stimulus programs as politicos strive to thwart the most depressionary forces since the Thirties. The recent extension of unemployment benefits and the housing tax credit (the latter certain to show diminishing returns) are a good indication of the desperate patchwork fixes to be seen as we try to stave off the inevitable severe adjustments needed to become a viable economy once more.

The U.S. is not headed for a typical post-war economic recovery, and the bull market of the past eight months is on very fragile ground.

2009 Nov 15 10:25 AM

[bbro]

Ah yes....GOLD....Gold is up 28% since March....S&P is up 60%....


On Nov 15 10:05 AM ari5000 wrote:

> Priced in gold, David Rosenberg's prediction of 600 by Oct. 2009
> is not that far off...

2009 Nov 15 10:38 AM

[bbro]

S&P 500 is as of Friday 7.64% of GDP...historical median in a
low inflation environment ( 4% yr over yr or lower) is 9.4%


On Nov 15 10:25 AM Alphameister wrote:

> I think you wanted "antidote," not "anecdote" in your first paragraph,
> John, but otherwise an excellent warning of the economic challenges
> we face. Consumer sentiment took a big drop recently and there is
> a reasonably good correlation historically between consumer sentiment
> and stock prices.
>
> You talk about fiscal stimulus coming to an end in 2011, but I see
> an almost certain succession of stimulus programs as politicos strive
> to thwart the most depressionary forces since the Thirties. The recent
> extension of unemployment benefits and the housing tax credit (the
> latter certain to show diminishing returns) are a good indication
> of the desperate patchwork fixes to be seen as we try to stave off
> the inevitable severe adjustments needed to become a viable economy
> once more.
>
> The U.S. is not headed for a typical post-war economic recovery,
> and the bull market of the past eight months is on very fragile ground.

2009 Nov 15 10:40 AM

[John Lounsbury]

The structure of unemployment (not just the extent) and the extent of home price depreciation are just two of the factors that make this recession difficult to compare to prior downturns post WWII. The charting observations made by bbro, which I have documented in articles, are indeed correct. In the past, these would be much easier to interpret. However, the factors listed below are just three of the reasons this time is different:

1. In the recession considered to be the worst before this one (1981-82), the total number of jobs lost was 1.661 million (would be 2.22 million adjusted for today's higher population). Of these 45% (approximately 1 million relative to 2009 total population) were permanent.

The corresponding numbers today are 8.39 million jobs lost (more than 3.75 times as many) and 56% are permanent (4.70 million, 4.7 times as many).

We have to deal with 4.7 million jobs that are never coming back. This is a dislocation much more severe than ever experienced in post WW II history.

2. The second dislocation much greater than anything since the Great Depression is the unprecedented decline in home values. With median values dropping at least 20% in many regions, and more in some, the economic distress on consumers is draconian. The fact that prices still have not returned to long-term trend lines is indicating that further problems may occur, in spite of government efforts to put in a floor for the market.

3. The collapse of the financial system we have seen is like a 100 year flood. When the firms saved only by unprecedented government support through assumption of substantial government ownership are included, the financial crisis dwarfs even the magnitude of the Great Depression. I have written articles making these comparisons last summer.

We all tend to interpret situations based on our past experiences. We have so many factors outside of the range of experience of those living today that there are bound to be many false projections. That is why a few, like John Mauldin, continue to examine our situation with viewpoints outside the box of our common experiences to our great benefit.

The fact that we are in uncharted waters and will remain there for some time is simply not appreciated by many.

2009 Nov 15 11:00 AM

[bbro]

In an attempt to look outside the Box....Household debt service payments as a % of GDP is 10%....if we use 1986 as the last time we
were a"Normal" economy under the rules of the New Normal i.e. 8%
savings rate.....our household debt service payments as a % of GDP
was 8.8%. Not diminishing the importance of dealing with idebt s it not
possible that Mr. Maudlin's original thesis 5 years ago of a Muddling
Along Economy was correct and last year was an overreaction to
an exogenous event. As an aside housing is an inventory problem
and time often takes care of inventory imbalances. The value of the stimulus package is not just growth or jobs but allows for repair of
an inventory imbalance without killing the patient.

2009 Nov 15 11:26 AM

[Michael Shulman]

A narrow answer to the question of retail sales is the confusion among investors -- and of course, blow dried media pundits -- about retail sales and consumer spending. Government statistics on consumer spending include spending health care -- typically exempt from state taxes. Health care spending, doing very simple math, 17% of the economy or 17 into 65, the percent of the economy that is consumer spending and you can see health care spending is at least 25% of consumer spending. And expenditures are rising monthly due to medical cost inflation. You can do the math and see why retail sales are much worse off than consumer spending. And retail sales drive many kinds of employment, drive rents on retail space and so on, shipping, manufacturing and so on. Bottom line: the fall of retail sales is much worse than consumer spending in general and, in my opinion, not recover to previous levels, holding down employment, especially at the lower end go the job market. Recent surveys by ChangeWave (changewave.com) show consumer spending is flattening out. That being said, do not short the retailers, the Street continues to love them, if you want to short traditional retail, go long Amazon as I recently wrote in my service, ChangeWave Shorts (also ChangeWave.com.

2009 Nov 15 11:42 AM

[Glen L.]

@bbro: "As much as Mr. Mauldin's Texas Republican politics is a part of his economic opinion the stimulus has paid out 206 billion in tax cuts.grants.and loans. There is another 379 billion to go in Fiscal year October 2009 to October 2010."

As much as your Democrat politics is a part of your opinion, where do you think the stimulus funds came/will come from? From (a) taxing the productive non-government sector, the very people who are struggling to stay afloat in this economy and who would be hiring if you don't overtax them; (b) from China et al; and (c) from the government printing press. All of which is Keynes on steroids and horrible from an economic perspective. Furthermore, your rosy employment picture is false, because by far the biggest increase in hiring is being done by the Federal government, and we all know how productive THAT sector is in the economy.

So get down off your partisan horse and learn the lessons of history. The Great Depression was started by a Republican and made far worse by a Democrat who continued and exacerbated the former's failed stimulus, monetary and taxation policies. The exact same thing is happening this time, but the results are going to be far worse, due to the exponential increase in the size of the Federal government since 1930.

Cheers,
Glen L.

2009 Nov 15 11:47 AM

[MarkitWacha]

As the currency collapses, manufacturing will pick up the slack. The illegals will leave to go back to where they've been sending their dollars.

Texas employment markets are stable, which is why the idiot extremist socialists from the coasts are coming here to Dallas in droves. I can literally flip off 4 Californians at once by raising my hand through the sunroof when I'm driving to and from work.

2009 Nov 15 11:52 AM

[yellowhoard]

The unemployment numbers that the author estimates are rosy in my opinion.

At rates slightly higher than what we currently have, we'll see a cascading effect on tax revenues and government expenditures that will require QE on a level that will dwarf what we are currently seeing.

The rest of the world is aware of this. They will dump the dollar. Interest rates will have to rise substantially and businesses will close at a record pace.

We are circling the drain.

2009 Nov 15 11:54 AM

[Glen L.]

John Mauldin: thanks for a great piece. It's easy to see that you (and Mish) have put a ton of work and thought into it.

But.... why so rosy an outlook? ;-)

I just finished reading Robert Murphy's excellent "Politically Incorrect Guide to the Great Depression". He makes a very strong case that the Fed was responsible for the 1929 crash, that the Depression did not end until 1946, and that both Hoover and FDR pursued avante-garde socialist and fascist economic policies in what was generally a well-meaning effort to alleviate the pain, policies which utterly failed because they were based on economic fallacies and ignorance. What are we seeing now if not exactly the same mistakes, only much larger in magnitude?

The only way out of this is for the average citizen who still has a job to start saving and prudently investing to rebuild the capital base, and for government to shrink dramatically and reduce the tax burden, allowing entrepreneurship to flourish again. Every other recovery scenario is based on inflating one bubble or another, with disastrous consequences. The stimulus packages are just the federal government bubble, which is the biggest fiasco of them all.

2009 Nov 15 12:03 PM

[Old Trader]

I suspect that the "good ol' days" of 5% unemployed being considered "full employment" are behind us, and we'll be much closer to the European model (somewhere in the 8-10%, as mentioned in the article).

I just posted some suggestions on addressing the unemployment problem on my instablog, and hope to get feedback from the SA community.

2009 Nov 15 12:07 PM

[dividend_growth]

If all the money sits in banks as cash, where will the demand come from?

If there are no demands, where will the jobs come from?

If the federal government does not spend now, who does? American consumers already knee deep in debt?

2009 Nov 15 12:20 PM

[John Lounsbury]

Glen - - -

I gave you a thumbs up but had to think about it because you gave far too simple (and in my opinion misleading) summary of the Great Depression. I have studied that time period quite extensively and the statement you made is simply oversimplification of a very complex situation. I refer to your statement:

<The Great Depression was started by a Republican and made far worse by a Democrat who continued and exacerbated the former's failed stimulus, monetary and taxation policies.>


On Nov 15 11:47 AM Glen L. wrote:

> @bbro: "As much as Mr. Mauldin's Texas Republican politics is a part
> of his economic opinion the stimulus has paid out 206 billion in
> tax cuts.grants.and loans. There is another 379 billion to go in
> Fiscal year October 2009 to October 2010."
>
> As much as your Democrat politics is a part of your opinion, where
> do you think the stimulus funds came/will come from? From (a) taxing
> the productive non-government sector, the very people who are struggling
> to stay afloat in this economy and who would be hiring if you don't
> overtax them; (b) from China et al; and (c) from the government printing
> press. All of which is Keynes on steroids and horrible from an economic
> perspective. Furthermore, your rosy employment picture is false,
> because by far the biggest increase in hiring is being done by the
> Federal government, and we all know how productive THAT sector is
> in the economy.
>
> So get down off your partisan horse and learn the lessons of history.
> The Great Depression was started by a Republican and made far worse
> by a Democrat who continued and exacerbated the former's failed stimulus,
> monetary and taxation policies. The exact same thing is happening
> this time, but the results are going to be far worse, due to the
> exponential increase in the size of the Federal government since
> 1930.
>
> Cheers,
> Glen L.

2009 Nov 15 12:24 PM

[bbro]

You want to take away social security and Medicare go ahead ( good luck getting elected too)....the last time the world you dream of existed was in 1893....
good times for all.....


On Nov 15 11:47 AM Glen L. wrote:

> @bbro: "As much as Mr. Mauldin's Texas Republican politics is a part
> of his economic opinion the stimulus has paid out 206 billion in
> tax cuts.grants.and loans. There is another 379 billion to go in
> Fiscal year October 2009 to October 2010."
>
> As much as your Democrat politics is a part of your opinion, where
> do you think the stimulus funds came/will come from? From (a) taxing
> the productive non-government sector, the very people who are struggling
> to stay afloat in this economy and who would be hiring if you don't
> overtax them; (b) from China et al; and (c) from the government printing
> press. All of which is Keynes on steroids and horrible from an economic
> perspective. Furthermore, your rosy employment picture is false,
> because by far the biggest increase in hiring is being done by the
> Federal government, and we all know how productive THAT sector is
> in the economy.
>
> So get down off your partisan horse and learn the lessons of history.
> The Great Depression was started by a Republican and made far worse
> by a Democrat who continued and exacerbated the former's failed stimulus,
> monetary and taxation policies. The exact same thing is happening
> this time, but the results are going to be far worse, due to the
> exponential increase in the size of the Federal government since
> 1930.
>
> Cheers,
> Glen L.

2009 Nov 15 12:27 PM

[ebworthen]

Put down the hopium pipe, and the tattered paradigm flag of a Donkey or Elephant. Republicrat - Demican....same thing.

Politics is the distraction.


On Nov 15 08:57 AM bbro wrote:

> We will get positive job growth in 2 to 3 months.....the ratio of
> non farms to jobless claims turned up in March 2009, it brokes its
> 12 month moving average in August 2009...going up. and the 12 month
>
> moving average will turn up in 2 months. When this 12 month moving
>
> average turns up we will get job growth. The ISM non manufacturing
> business
> activity index 3 month moving average projects job growth within
> several months. As much as Mr. Mauldin's Texas Republican politics
> is a part of his economic opinion the stimulus has paid out 206 billion
> in tax cuts.grants.and loans. There is another 379 billion to go
> in Fiscal year October 2009 to October 2010.
>
> Oh yeah I know Rosenberg predicted the current crisis but he has
>
> also notorious incorrect predictions too.

2009 Nov 15 12:28 PM