Saturday, August 06, 2011

Things That Don't Mean Much

It’s a sad commentary on America’s state of mind when unemployment of 9.1% is good news because it’s a drop of .1% from the preceding month. We used to think that 1% improvement from a bad state of affairs was inadequate, and we used to “look under the hood” of numbers like this and realize that, in this case, the improvement was caused by people ceasing to look for work rather than by people getting jobs.

Adding 117,000 net new jobs is good news, but less so when one realizes that the addition was insufficient to keep up with the growth of the labor force and when one reads in the employment report that slightly fewer people were actually employed in July than were employed in June.

These days we don’t look to see if good news is real or not, nor if it’s actually good. We just take anything that isn’t bad news and become so overjoyed that we run out and buy stocks like drunken sailors.

On the flip side of that coin, S&P downgraded our credit rating to AA+ yesterday. Right. They also rated Lehman Brothers AAA just one month before the collapse. The other two ratings agencies left us at AAA, and all three of them rated CDS instruments backed by home mortgages as “prime” in 2007 and 2008. So why do we care what they think?

And President Obama has finally “pivoted to jobs” as his agenda. Time for a reality check, people, he has begun his reelection campaign. In the last one he was going to close Guantanamo, end secrecy in government, restore the constitution… In this one he’s going to “create jobs” and “we are going to do this together.” "This," presumably, being pounding on the podium.

To "create jobs" he wants to extend the payroll tax cut and long term unemployment benefits. Not that the latter is a bad idea, it helps people who are in need and we should do it, but if these things have not been creating new jobs in the past, why are they going to create new jobs in the future? You don't create new things by using old ideas, nor do you change things by continuing what is not working.

His campaign even begins with a bus tour. Omigod, where have we seen that before? Is the bus going to have a big sign on the side of it with, maybe, a Liberty Bell? I cannot wait to hear what Sarah Palin has to say about that.

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