Two hits on The Washington Post website are all you need to see this morning to understand why policy makers need to be very careful in the coming weeks.
The headline number is likely to figure into ongoing debate in the Senate today over the Obama administration's proposed economic stimulus package.
President Obama has warned of possible double-digit unemployment if the government does not act quickly, and the head of his Council of Economic Advisers used the new numbers to reemphasize the point.
"If we fail to act, we are likely to lose millions more jobs," council chairwoman Christina D. Romer said in a news release.
From our friends at the Committee for a Responsible Federal Budget:
Today, the Committee for a Responsible Federal Budget released a statement urging policymakers not to include policies intended to be permanent as part of the stimulus package, and released a list of some of the policies most likely to be made permanent. See http://www.crfb.org/documents/ReleasePermanent.pdf
The Committee also launched Stimulus Watch, an interactive table detailing all government actions taken to deal with the recent financial and economic turmoil. See Stimulus Watch. For a complete overview of how to use this table, watch this introductory video or read this table key.
From time to time, I like to update the following two pictures. The first shows the time-series of the unemployment rate and the unemployment rate augmented to account for all marginally attached workers and those employed part-time for economic reasons. The latter is referred to as U-6 and is reported here each month. The two rates reached 7.2 and 13.5 percent of the relevant labor forces, respectively, in last Friday's employment report. The augmented rate is rising even more precipitously than the basic rate.
Mark Landler makes a number of good points in his New York Times article, "Chinese Helped Inflate American Bubble," but he leaves out the most important one. The U.S. government, on behalf of U.S. citizens, decided to run budget deficits during a fiscal expansion. U.S. consumers decided to use their lower tax burden during the last eight years to spend rather than save. No one else can be held responsible for those decisions.
I broke one of my oldest rules last night when I stopped at a shopping mall between Thanksgiving and New Year's Day. I was just going to pick up dinner at a favorite restaurant, but I broke the rule nevertheless.
As I walked around the mall during the 20 minutes between when I placed the order and it was ready to be picked up, I realized that one of the mall mainstays from previous years -- the calendar store -- wasn't around this year.
You know what I'm talking about. This is the business that shows up in an empty storefront in the mall just after Labor Day and by now is running a big sale to get rid of its inventory before January 1. Or if there's no vacant storefront, it's the business that temporarily occupies a kiosk area near the food court. This is the business that has calendars with every conceivable dog and cat breed, scenes from this year's hot movies, hottest stars, etc. These are the calendars that were stocking stuffers.