Another week with a range of supposedly good economic news for the United States, leading to some officially-sanctioned cheerleading by the media. Job growth for November was said to be 215,000. Wayne Madsen wrote that we shouldn't believe these numbers:
Bush unemployment stats phony as Iraqi intelligence claims. Today, the White House is crowing about the latest job statistics. It is basing its claims on the most recent job figures issued by the Labor Department. The Bush administration is claiming 215,000 jobs were added in November with unemployment hovering at 5 percent. However, a former economist with the Bureau of Labor Statistics said the bureau, which determines the monthly unemployment figures, has been totally politicized by the Bush administration. The numbers are "tainted," said the former official, adding, "the Bush people changed the credibility and independence that past administrations insisted upon for the monthly unemployment figures."No surprise there. Why should we believe anything these people say? George Ure takes a closer look at the numbers, and they don?t look so good close up.
Nonfarm payroll employment grew by 215,000 in November, and the unemployment rate was unchanged at 5.0 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Over the month, job growth was widespread, with large gains in construction and food services.Don't forget that pay is down for the vast majority of people, that pensions are being taken away and the price of health care, energy and college educations are soaring. How are we U.S. consumers going to keep the housing bubble going? Evidence is mounting that houses are staying on the market much longer than they did a year ago in the bubble markets. Note also that the areas of strong job growth were in construction and food service. How long are construction jobs going to keep growing? George Ure again:
Unemployment (Household Survey Data)
The unemployment rate was unchanged in November at 5.0 percent. The jobless rate has ranged between 4.9 and 5.1 percent since May. The number of unemployed persons, 7.6 million, was essentially unchanged in November. The unemployment rates for adult men (4.3 percent), adult women (4.6 percent), teenagers (17.2 percent), whites (4.3 percent), and Hispanics or Latinos (6.0 percent) showed little or no change in November. The jobless rates for blacks (10.6 percent) and, specifically, for adult black women (9.1 percent), rose over the month. In November, the unemployment rate for Asians was 3.6 percent, not seasonally adjusted. (See tables A-1, A-2, and A-3.)
Total Employment and the Labor Force (Household Survey Data)
Total employment, 142.6 million, and the civilian labor force, 150.2 million, were little changed in November. The employment-population ratio also was little changed over the month at 62.8 percent, and the labor force participation rate held at 66.1 percent.
But it's not all backslaps and glee at BLS. Buried in the U-6 report (Alternative Measures of Labor Underutilization) we see that the unemployed plus marginally attached workers (and the MBA's flipping burgers) increased from 8.1% of the workforce to 8.4% in November. That's a tad over 1.26 million not following their calling, and that's not counting people who have fallen off the statistics because they have run out of benefits. We reckon honest unemployment is somewhere north of 10%.
There was good news and bad in the Tuesday housing figures released by the Commerce Department. On the one hand, sales were much brisker than normal, yet on the other, and somewhat buried in the data, the median price of a home was up to $231,300, up a scant 0.9% from year ago levels. Now, in case your double Americano tall hasn't soaked into the bloodstream yet, the problem is that with inflation running 4% for the year to date, that means that in purchasing power terms (which is the only thing that matters to us) the home prices have dipped about 3% year on year (YoY).Retail sales for the holiday season are also somewhat troubling, although not bad. See the following from the Houston Chronicle:
Add to that the report that consumer confidence was up substantially (and a bit unexpectedly, I'll admit) driven by lower gasoline prices, and word that online e-tailing is alive and well, and you get something akin to what the NY Times paints as an optimistic outlook.
Next week, as the Federal Reserve meets (if we get that far unscathed), the Fed is likely to raise rates another quarter point, encouraged to do so by the global(ist) Organization for Economic Cooperation and Development, which figures the Fed should increase rates another 75-basis points; 3/4's of a percent if you're not a bankster.
This is where I start to run into concerns because a 3/4% increase in the Fed rates would likely spell the end of the housing bubble, for good. This flies straight in the face of the policy of the Fed which is to protection of any asset which could be used (as in refinanced) to keep the economy afloat just a bit longer.
It's a lot like a physics problem: unstoppable force (pressure to raise interest rates) meets immovable object (protection of an asset class to prevent an instant Depression). There are only a few possible outcomes: Our expectation is that rates will go up.
Also something to ponder would be the timing about now of any Huge Exogenous Event (HEE). What ever it is, it would need to come from outside the market and be of sufficient magnitude to take the blame for whatever happens next in the markets. In other words, if you were going to be forced by global economics to raise rates more than the expected 25-basis points, wouldn't it be convenient to have some big event take place which could be blamed instead of the rate move for an unexpected lurch in the markets?
What the web bot runs (from www.halfpasthuman.com) have forecast for around this window we're now in is something that would be roughly two to three times the size of the hurricane disasters and would focus American attention on something other than moves that are out of the ordinary.
Spotty holiday sales results are making retailers jitteryWhat few people in the mainstream media are pointing out is that, now that the housing boom has peaked and interest rates are rising thereby putting pressure on consumer spending, the economy is being kept alive by the Iraq War. Ure again:
Discounting may be the only way to woo buyers
By Anne D'Innocenzio
NEW YORK - The holiday shopping outlook was hazy Thursday after the nation's retailers reported a mixed start to the season that showed consumers were willing to spend only when they found bargains.
One thing was certain, however ? retailers are likely to resort to heavy markdowns in hopes of meeting their sales targets. Many of last month's winners were stores that heavily discounted over the Thanksgiving weekend, including Wal-Mart Stores and J.C. Penney Co.
November had some surprises ? upscale retailers were among the disappointments, including Nordstrom, usually a top performer. On the upside, Limited Brands had solid gains after struggling for months with its fashions. Limited's sales were fed by a combination of aggressive price cutting and a makeover at its Express division.
"You had some very good performances by only a handful of stores, but you also had a fair amount of weakness. Most of the business was driven by promotions," said Michael Niemira, chief economist at the International Council of Shopping Centers.
"More of the season's sales now ride on December, which is dicey because of the weather and promotional activity," which could hurt stores' profits, he said.
The UBS-International Council of Shopping Centers' November sales tally of 65 retailers rose 3.5 percent last month; the results matched Niemira's forecast, but beat a meager 1.8 percent increase a year ago. The sales tally is based on sales at stores open at least a year, known as same-store sales.
Niemira added, "The economic numbers look better, but on the other hand you worry about consumers' ability to spend."
While gasoline prices have fallen, they're still above last year's levels, and home heating costs are also expected to be high.
Out from the Department of Labor's Bureau of Labor Statistics:The GDP figures were also touted as evidence that the Bush economy is strong. But if its strength in the last couple of years comes from military spending and consumer credit, and the housing bubble is about to pop and the war is going very badly, what do they do next? Perhaps they can react to Ure's HEE (Huge Exogenous Event). The result: a military dictatorship, of course, with rationing, Civilian Inmate Labor Camps (CILF?s), and currency controls. Here's Al Martin:
Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 4.3 percent in the third quarter of 2005, according to preliminary estimates released by the Bureau of Economic Analysis. In the second quarter, real GDP increased 3.3 percent.
The GDP estimates released today are based on more complete source data than were available for the advance estimates issued last month. In the advance estimates, the increase in real GDP was 3.8 percent (see "Revisions" on page 3).
The major contributors to the increase in real GDP in the third quarter were personal consumption expenditures (PCE), equipment and software, federal government spending, and residential fixed investment. The contributions of these components were partly offset by a negative contribution from private inventory investment. Imports, which are a subtraction in the calculation of GDP, increased.
...If our CPI expectations come true, we will see a year that is about a push - increase in GDP being about equal to inflation. On the other hand, we also note that without the War in Iraq, the economy would not be doing nearly as well:
"Real federal government consumption expenditures and gross investment increased 8.1 percent in the third quarter, compared with an increase of 2.4 percent in the second. National defense increased 10.3 percent, compared with an increase of 3.7 percent. Nondefense increased 3.6 percent, in contrast to a decrease of 0.2 percent. Real state and local government consumption expenditures and gross investment increased 0.4 percent, compared with an increase of 2.6 percent."
In a post-PATRIOT III environment, the FEMA-OEM combination could at any time exert absolute control over the production and distribution of food and fuels, by the power already given to them under PATRIOTs I and II.Seems like a winning proposition for the Bush cabal. First, steal everything that is not tied down, then pull the plug and enslave the survivors. Welcome to the Pathocracy.
In a post-PATRIOT III environment, they could act under the existing declaration of a national emergency signed by George Bush in September 2001 that gives them enough to hang their hat on, legally speaking, to exert control over the production and distribution of food, water, medicine, etc. in the nation. As we have mentioned before, the OEM has done surveys of all the large food distribution companies in the United States, asking them the total number of outlets they have, the square footage, the production volume, etc. They would then have the information ready so the FEMA-OEM super-combo agency (the State Security Agency), after PATRIOT Act III, would have the information necessary to take control of food and water distribution, production, etc. in the nation if they so chose to do.
All of this is combined with what we have been writing about?the various edicts of the U.S. Treasury to increasingly restrict citizens? ability to own gold, to take gold out of the country, to force them to use a soft dollar in a post-economically collapsed environment, knowing that that is the ultimate goal.
Why is all of this is being done? Why is the regime moving to a militarized police state and to a dictatorship?
It is because of what Comptroller General David Walker said, that after 2009, the ability of the United States to continue to service its debt becomes questionable.
Although the average citizen may not understand what that means, when the United States can no longer service its debt it collapses as an economic entity. We would be an economically collapsed state.
The only way government can function and can maintain control in an economically collapsed state is through a military dictatorship. Government has never been able to maintain control throughout history of a post-economically collapsed environment other than in a military dictatorship. We have seen many examples of this south of the border, in Eastern Europe and in Asia throughout the twentieth century.
There is really nothing new about this. People act like this is something new. The people who believe that, of course, are the naive flag-wavers. They also believe that what has happened on the rest of this planet throughout history can?t happen in the United States. Of course, it can. And it will happen because Bushonomics ensures that it will happen.
Bushonomics is ensuring the need for a military dictatorship in the nation. The United States, in order to survive in a post-economically collapsed environment, would have to have the ability to repudiate the trillions of Bushonian debt that has been accrued. It couldn't survive as an economic state and still service that debt.