We have read about the unemployment rate being high. Really anything around six percent is pretty good and it is less than that now according to the statistics, but some politicians say it is terrible and others say it is reasonable. It depends upon which side of the isle you sit.
Our Washington geniuses claim they are working on finding more employment. We have lost 2.7 million jobs over the last 3 years. That doesn't matter if you are NOT one of them. Finger pointing by everyone in our capitol blames "the other guy", but especially China and India. The total of jobs going overseas is only 300,000 out of the 2.7 million. Where did the other 2.4 million jobs go?
As the economy slowed down in 2000 due to the increasing interest rates companies had to do something to keep profits. The work week could be shortened if you did not have a production line, but that doesn't work for service businesses. All unnecessary workers were laid off. As business contracted machines became idle and more people were chopped. But that was not enough. More production efficiencies were put in place so that fewer workers would be able to turn out the same amount of goods.
Production dropped from the 92% to about 75% of capacity today. When a company has 100 machines and only 75 of them are producing there is no incentive for management to buy more machines.
Sir Alan can try to stimulate further by lowering rates even more, but how much below 1% can you go? He could buy long-term bonds to further reduce rates to continue to stimulate the housing market, but financial stimulus does not create wealth. The banks borrow from the Fed at 1% to buy long-term government bonds that yield 4.2%. If I were a banker and could lock in 3.2% with no risk why should I make loans to businesses? And beside that I can fire all my loan officers to save more money.
But we need more employment. How? The Federal government is hiring more people every day. These are new jobs, BUT they do not contribute to the overall economy. In fact every new government worker is another tax. In a factory a worker turns out products that adds to what is called Gross Domestic Product. A government worker turns out nothing and adds zero to the GDP and even has to give back part of his salary in taxes. The IRS takes in the money, gives it to Congress who creates burocracies that hire people to recirculate the cash. Every government worker is a tax.
This makes the employment numbers look good, but adds nothing to our economic production. It is a way to keep money flowing. It puts money in peoples' pockets that keeps us marching in place. Until real productive job are created by business we are just fooling ourselves.
Al Thomas' book, "If It Doesn't Go Up, Don't Buy It!" has helped thousands of people make money and keep their profits with his simple 2-step method. Read the first chapter at http://www.mutualfundmagic.com and discover why he's the man that Wall Street does not want you to know.
1-888-345-7870; http://www.mutualfundmagic.com
The number of countries in the world at the moment... Read More
When Boris Yeltsin spoke about an experiment that 'they' wrought... Read More
I've decided to go public with my intentions: I will... Read More
A visitor to Moscow would be immediately struck by the... Read More
In these times when states are suffering extreme downward pressure... Read More
The official working week is being reduced to 35 hours... Read More
"Similar to Medieval Inquisitions, judges have been given the authority,... Read More
Alexander Hamilton ? Policy Separated from Politics:I am related to... Read More
The City of Portland is going after any small business,... Read More
The gun control debate in America is a battle between... Read More
Many of the problems that the members of the European... Read More
The 'Land of the Free' is teaming with individual rights... Read More
Guides for RetailersThe regulations about marketing pearls are listed in... Read More
In Belarus parliament is going to struggle with degeneration of... Read More
There are many mines around the world, which are owned... Read More
One of Abraham Lincoln's claims to fame is the fact... Read More
There are so many problems with our perceived perfect checks... Read More
The expertise and advancement of the evolution of man and... Read More
Heavens, what are we up against? It seems these days... Read More
The US-backed Road Map peace plan had no real chance... Read More
Former Senator, Daniel Moynihan, accurately summed up the situation when... Read More
In his bid for the presidency, John Kerry pronounced a... Read More
The devastating loss in case of Elliot Spitzer for NY... Read More
For anyone who wishes to become an armchair General in... Read More
United Liberation Front of Assam (ULFA), one of the most... Read More
Antigo wedding limo ..Most politicians are completely out to lunch and totally Machiavellian... Read More
We are having a problem in America with Public Notaries,... Read More
In order to build a stronger, more self-sufficient America, America... Read More
The new law "Special Protective, Antidumping and Import Compensatory Measures"... Read More
In the fields of juvenile justice policy and programming, there... Read More
The 'Land of the Free' is teaming with individual rights... Read More
A Governmental commission, headed personally by the Prime Minister has... Read More
Our Airports have excess capacity, which is not being used... Read More
In Police Magazine I read a great article about transient... Read More
The official working week is being reduced to 35 hours... Read More
Even the most devout proponents of free marketry and hidden... Read More
Political strategists, branding gurus and image consultants could learn a... Read More
Just because we have been leading the World in innovation... Read More
Ohio's transportation sector seems to be strong, even with Ohio's... Read More
Iran's objection to ratifying the International Atomic Energy Agency's Additional... Read More
We are destroying our freedoms and slowing innovation, due to... Read More
The other day I was sucker punched, hoodwinked, bamboozled, had... Read More
We know that in Maryland, which some call "Merry Land"... Read More
A SOLUTION FOR EMPLOYMENT PROBLEMS TO AID IN THE FIGHT... Read More
Last Summer the Federal Trade Commission came out with a... Read More
Many times our government regulatory over embellish problems in the... Read More
The debate to raise minimum wage in California is totally... Read More
Water Conservation in larger cities is less of an issue... Read More
Much of our personal and cultural perspective on the world... Read More
The Republican Party became popular due to its view on... Read More
Political |