Non-recovery News: More Jobs Lost, Record Low Homes Sold

Another Thursday, and the Labor Department released new figures for people filing their first-time unemployment claims. Figures are now at a 9-month high, as bad as they were last November (a year after the multi-trillion bailout and subsidization of the banking system began.) This is not an indication of recovery, despite DC spin, nor is it a slow recovery - it's a deterioration - it would be a useful policy to admit this, rather than sugar-coat it, so we can examine better methods to create jobs.

The ranks of the new unemployed grew by an additional 12,000 people more this week vs. last week, to half a million people led by California, Indiana and North Carolina. Last's week's already bad number of 484,000 was revised upward to 488,000.  Those merry analysts got it wrong going in, again: "Analysts polled by Reuters had forecast claims slipping to 476,000 from the previously reported 484,000 the prior week".

Keeping track of other non-recovery news: pending home sale figures slipped to their lowest level since 2001 last month, while the number of houses waiting to be sold (or 'inventory') represents a 9 month backlog (the highest since last August.) Bank repossessions of foreclosed homes are near record levels, and have risen for the past 8 months. 

And, Tim Geithner and Ben Bernanke keep claiming those bailouts worked.

No Jobs = No Recovery

The Department of Labor released its weekly initial jobless claims today. They weren't good - at 484,000 people, the highest level in 6 months they were up by 2000 people since last week, and 14,250 since the prior week. The department also revised its previous claims estimates upwards. The trend and the reality continue to be unfortunately, dismal. We are still losing jobs.

And yet, news outlets continue to report this negative information as merely some kind of unanticipated interruption in the economic recovery we're all supposed to be enjoying (according to Tim Geithner, Ben Bernanke and the rest of Washington, anyway). This morning's interpretations of the claims?  They were higher than analysts' expectations.'  I continue to be amazed, not that economists keep getting it wrong, but that the media hasn't figured out that they are consistently overestimating the 'recovery' and underestimating the true deterioration in the economic condition of the country.

Maybe the Fed should rethink the term 'Economy'

Today, in a South Carolina speech, Fed Chairman Ben Bernanke repeated a bunch of stuff he's said in the past, stuff that confirms the status prevailing in his head - that he (along with notable DC cohorts) are invincible gods that stopped another Great Depression in its tracks simply by spilling out tons of money into the banking system, even if the results aren't that stellar for most of the rest of the country...

(note, I'm about to paraphrase him):

- The economic recovery isn't going as fast as we thought/said it was.

- We need to keep rates low so we don't choke the recovery that isn't going as fast we thought/said it was (though in practice that means banks will keep hoarding capital to trade and corporations will bulk up on debt.)

- The 'recovery' is still jobless (though he can't seem to understand why.)

- Households will probably start buying more at some point because incomes will magically rise which will help the economic recovery that isn't going as fast as we thought/said it was.

He probably said more, but I lost interest in the premise of his delusion - that the true majority of people in this country are feeling like they're actually in the midst of an economic recovery - slow or otherwise.

Since the trillions of dollars of bailouts poured into Wall Street, what's basically happened is:

- The largest banks are doing better (cause of the trillions of dollars).

- The largest corporations are reloading up on debt (cause of the trillions of dollars that went to their banks and the fact that rates are so low.) This July marked a month of record debt issuance for big firms.

And yet, none of this is translating into:

- Small businesses or individuals getting equivalently good terms on restructuring debt, or gaining loans for expansion or to keep current payroll numbers and not have to cut jobs. Instead, bankruptcies continue to rise.

- New jobs (people applying for initial unemployment claims continue to stream into that status at a rate of just under half a million a week, and that figure doesn't count freelancers or contractors who can't get unemployment so can't file claims to begin with). The unemployment rate is likely to push up to 10% again at this rate (even with DC figure tinkering), and that's not even including everyone who's underemployed.

- Higher general salaries (higher productivity yes - but, people working more hours for less money, is not the stuff of a true recovery.)

- Less foreclosures - the first half of this year marked a greater amount of home foreclosures than the first half of 2009 or 2008. 

Maybe it's time Bernanke reconsidered what the term 'economy' means to the general population.

What do you guys think - how should 'the economy' really be measured?