Wednesday, May 13, 2009

Those Illusory Glimmers of Hope

I have the same graduate economics background as many of the current economic commentors who claim the U.S. economy is poised to come around. And yet, I can't help being confused about what they're seeing and what I may not be seeing.

I have to wonder if their own personal business interests are clouding their judgment. The numbers are not encouraging by any standard. It's akin to a doctor suggesting to their patient that the spread of cancer is growing but the rate of growth has diminished so the patient should be encouraged. We have almost 14M people unemployed out of a labor force of about 155M. At some point, the rate of decline has to slow. If, for example, the economy lost 500K new jobs a month for just 4 more months, we'd be seeing an unemployment rate of over 10%. Due to the structure of the economy, there is no way that rate is sustainable. At least I hope.

With porkulus, and a daily barrage of nonsensical Keynesian inspired economic policies, I don't see how anybody worth their salt could objectively hope for a recovery after seeing these numbers. Especially if they were trying to encourage new business investment, which is what ultimately creates new jobs. Not that I want to be a conspiracy theorist, but there has to be other motives behind why these economists are even cautiously optimistic.

No comments: