The state of the economy

[erik_kosberg]

Unemployment just to a sharp upward jump. What’s next?

[wivabef]

Originally posted by erik_kosberg
Unemployment just to a sharp upward jump. What’s next?

A sudden ration of "O's" and "K's"?

[mnehr]

I am interested to see how the fourth quarter is. I bet everything picks up.. I know in my industry, we are starting to see a turn around in collections and late payment efforts (in other words, the percentage of people paying their bills late or not at all has fallen off drastically.. my conference call yesterday said it was something like a 40% improvement in August over the previous 3 months, and this month is even better)

Also, do not be so quick to blame Bush for this 'slowdown' (that started about October of last year).. the only part of Bush's budget that has gone into effect was the rebate checks.. Bush's budget does not officially even start until October 1st.

Also, I do not necessarily buy how bad the news says the slow down is.. they are using stats based on the Dow, and that only is a small indicator of the economy. Blue Chips have actually been doing good, and the bond market has been skyrocketing.

Even the unemployment news is not that bad if you look at the big picture, it is still one of the lowest in our nation's history.

In my little bubble of a world, I find the unemployment numbers unbelievable, as it is so hard to find qualified workers right now. I believe our company has something like 1500 open positions around the country that we just cannot find anyone to fill (by the way, anyone looking for a job, please e-mail me and I will check in your area.)

Lets re-ask this question in December or January...

[CeeJay62]

I'm not sure how long this will last. The more I read, the more I believe we are going to have to make a correction for what was an inflated market the last couple of years, the "irrational exuberance" Greenspan talked about. So many industries got a boost from the dot.coms trying to make a go of things (office supplies and computer systems for example) and now they are falling on hard times. Which means they are laying people off, which causes people not to buy, which can erode consumer confidence and cause things to get worse, since many experts believe it is the consumer keeping things as good as they are (which isn't to say things are great) because businesses aren't buying right now.
Time will tell.
I doubt the tax cut is going to make much of a difference. Maybe it is time to cut capital gains.
I certainly hope things turn around fast, since my husband's company announced a merger last week and is moving corporate headquarters out of town. He's going to be looking for work in the next few months and a good economy will help.

[mnehr]

I had to throw this article in here.. and I am sorry for my harsh words but Daschle is an idiot... http://www.msnbc.com/news/623132.asp
The unemployment rate increase has nothing to do with any government budgets, Bush or Clinton.. but to blame Bush, whose budget does not even start until Oct 1st, shows he is just in it for the sound bite...

[erik_kosberg]

I certainly wouldn’t place all of the blame on Bush, some weaknesses in the economy were already evident while Clinton was still in office and any President should get only a part of the blame or credit for the economy’s performance. Federal Reserve policies, the economies of our major trading partners, and even the weather can get bits and pieces of the blame or praise.

Graphic design firms and printing companies in the Twin Cities have been going out of business left and right for almost a year but the scuttlebutt in the Cities’ fairly close-knit design/printing/advertising community suggests that we may be getting close to the bottom. The guy who does our studio’s tech support (when my boss or I can’t solve the problem on our own) told us that half of his clients have gone out of business in the last year. It’s down to the survivors now. Printers and paper companies (both locally and nationally) are taking a huge beating; I wouldn’t be surprised if some of the large national pulp and paper companies announce big layoffs over the next few months.

[CeeJay62]

Originally posted by mnehr
I had to throw this article in here.. and I am sorry for my harsh words but Daschle is an idiot... http://www.msnbc.com/news/623132.asp
The unemployment rate increase has nothing to do with any government budgets, Bush or Clinton.. but to blame Bush, whose budget does not even start until Oct 1st, shows he is just in it for the sound bite...

He may be an idiot, but he uses that calm, rational tone of voice so no one can tell he is spewing a load of crap.

I'm sure he just wants to blow enough smoke so no one will sit down think things out and realize the downturn started April, 2000, running large surpluses during a bad economy is a bad, bad thing and the problem with the government and their 2 TRILLION dollar budget is NOT that they aren't consuming enough of the GNP, they are spending too much.

[CeeJay62]

Originally posted by erik_kosberg
I certainly wouldn’t place all of the blame on Bush, some weaknesses in the economy were already evident while Clinton was still in office and any President should get only a part of the blame or credit for the economy’s performance. Federal Reserve policies, the economies of our major trading partners, and even the weather can get bits and pieces of the blame or praise.

Printers and paper companies (both locally and nationally) are taking a huge beating; I wouldn’t be surprised if some of the large national pulp and paper companies announce big layoffs over the next few months.

When I read your first paragraph I choked on my Diet Dr. Pepper


Bingo on the second paragraph. It hit very close to home!

[mnehr]

I believe we will see the bottom before the end of the third quarter. Many companies over-bloated themselves in the past 10 years in technology and employees and these cut backs will start to show up in increased profits.

I blame the overall drop in the past year on companies thinking that the high prosperity will just continue unabated... Of course, in reality, this does not happen.

My own company acquired over 250 smaller companies in the past 13 years, and in the past year and a half, we have started to suffer because of all that spending.

Luckily, we started cost savings efforts early (we only laid off 1,000 in the past year, and many of those were re-hired quickly). I am looking for a flat third quarter and a very strong fourth.

[mnehr]

He may be an idiot, but he uses that calm, rational tone of voice so no one can tell he is spewing a load of crap.

I am sure the Democrats will be glad to know that their spokesperson's message is likened to a regular bowel movement

[mnehr]

I do love the termonology in all of the news articles.. how the unemployment rate 'soars'.. yea, a gigantic leap of 4/10ths of a percent.. oh that is soaring... yea right...
If you want to look at something interesting, go look at the unemployment rate trends for the past 10 years.. you will notice a unique trend.. unemployment always increases by at least a few 10ths of a point at the end of summer.. you know why? Thousands of students going back to school and quitting their summer jobs...

Once again, to do my part, anyone here who needs a job, e-mail me where you are, we have so many open positions it is crazy.. I am not promising anything, but there may be something out there for you...

[erik_kosberg]

The numbers can be looked at several different ways. Going from 4.5% to 4.9% is indeed a 0.4% increase out of the 100% total but since 4.9 divided by 4.5 is 1.089, it can be argued that the unemployment rate went up by 8.9% in a month (and aren’t the numbers seasonally adjusted in some way? it’s been a long time since I took I took a macroeconomics class).

If the unemployment rate were to drop from 6% to 3% over the course of a year, you could bet your last dollar that whomever was the sitting President would say that unemployment had dropped 50% in the last year rather than 3 percent.

Originally posted by mnehr
I do love the termonology in all of the news articles.. how the unemployment rate 'soars'.. yea, a gigantic leap of 4/10ths of a percent.. oh that is soaring... yea right...

[frazzledspice]

Matt, only those people who are actually eligible for unemployment (i.e. involuntarily terminated from their jobs) are included in unemployment statistics. Often, the "discouraged workers" are not included (those who have gone beyond unemployment and are giving up.)

I am glad that your company is doing so well (although it seems as if a company that acquired 250 others over the past 10 years must have certainly contributed to an awful lot of unemployment for the employees of those 250 companies.)

Japan has, apparently, been in an economic downturn for ten years. I sure hope ours doesn't last that long!

When I was growing up, my grandmother always said, "A Democratic President brings in wars, and a Republican President brings in a recession."

With the exception of Reagan, that's probably been true of the Republican Presidents of this century.

Of course Reagan, by firing the air traffic controllers, took the first step in union-busting. Labor unions don't have half the power they did before Reagan came into office, and lots of times when they negotiate they're just hanging on by their fingernails trying to keep things from getting worse (I guess NAFTA had something to do with that, too.)

[cristina1]

Printers and paper companies (both locally and nationally) are taking a huge beating; I wouldn’t be surprised if some of the large national pulp and paper companies announce big layoffs over the next few months.

The paper companies in my area have already started with some big layoffs (on a local level.) A lot of people have either already been put out of work, or have been notified that they will be out of work soon.

It seems funny to me that the most thriving plant has its union workers out on strike right now demanding more when there are so many eager people to fill the positions. The plant hasnt slowed down at all - they have a lot of workers crossing the strike lines to get a salary because they have been laid off. You would think the union would realize this.