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A few days ago we wrote an article entitled:” How 22.1% unemployment turns into 8.9%.” In it we pointed out the absolutely ridiculous reporting of unemployment in Arizona that was 8.4% in December 2010 and then jumped to 9.6% in February 2011. When the press prints this kind of absurdity you better pay attention because something is really wrong.
We then pointed out that according to Jerome Corsi the unemployment rate was more in the 22.1% range.
Now comes an analysis by Greg Hunter which crushes the bloom off this 8.9% unemployment euphoria. This is not just an opposing view point. This is common sense analysis that says this government has lost control of this economy.
According to Hunter he tells us that:
“…if you look deeper into the numbers, as John Williams does at Shadowstats.com, you don’t see the turnaround picture. In fact, just the opposite is going on. In his latest report, Williams estimates the government is routinely overstating” g job growth by “230,000 jobs” a month. Using simple math, 192,000 created jobs (according to BLS) subtracted from 230,000 overstated jobs gives you an actual net loss of 38,000 jobs. “ More…
It is not even hidden anymore. The facts and the figures are there for all to see if you simply take the time to look. The heads of government know it and they have lost their collective conscience. It is all about power now and who will hang onto it when QE ceases.
Greg Hunter interviewed John Williams of www.shadowstats.com in this article. Williams is a brilliant statistician who explained to Hunter how the Bureau of Labor Statistics routinely distorts beyond any semblance of reality actual unemployment figures.
“This recession is the deepest and longest in modern history and the worst economy since the Great Depression. Williams told me the reason job figures are so far off is modern BLS calculations have never been tested in this kind of severe downturn. One reason the unemployment numbers are so misleading is the Birth-Death Model—meaning the birth and death of companies, not people. In simple terms, the Birth Death Model overestimates jobs that are created by startup companies and often does not subtract jobs when companies go out of business. So, what the government is giving us are giant distortions in employment and unemployment. According to Williams, unemployment is not trending down, but the economy sure is.” More…
The biggest and only fundamental reason that unemployment is going up and can only go up is that QE ( quantitative easing) is going to infinity because even a hint of cessation will kill the US Treasury market stone cold dead. If that were to happen the entire Federal Government would shut down. There is no practical way out of this mess which will end up almost assuredly in 50% cuts in the Federal government. Look at California. It is $20 billion short this year and has no way out but to cut since it has no money in the bank account. Eventually, the same will happen to the Federal government.
California cannot borrow in the bond market because it cannot tax anymore. There is no more tax revenue to be had and therefore it cannot pay for its bonds’ interest. It is broke. All the states are like California. Arizona is no different.
The only difference with the Federal government is that it can print. Every month you see deficits in the range of $50 billion dollars and that means more printing. More printing means less and less economic activity which leads back to declining employment. The politicians know this. To them this is all about power and who gets to keep it when the printing ceases. America is simply collateral damage.