Here we go again......
The most anemic recovery in post war history continues with this month's reported employment rate coming in at 8.3%. You might be saying "so what." Well, before you do, please remember that the reported employment number does not include the growing number of people who are "underemployed" or have given up looking for a job.
Given the magnitude of the preceding recession, many reports I have read submit that growth in GDP should be triple that which we are experiencing. The vast amounts of money that this White House sympathetic Federal Reserve has poured into the economy through "Quantitative Easing" has had little effect.
By the way, we used to call "Quantitative Easing" printing money, but it sounds so much better, doesn't it? Most of it is sitting in Treasury and banking reserves, the rest of it seems to have found it's way to White House sympathetic institutions and organizational pension funds. Some might be glad that these funds have not been significantly employed in the economy, because significantly accelerated growth in money supply in recovery could destroy the dollar and significantly inflate prices of goods and services that we rely on for a decent quality of life.
What is happening out there? I manage corporate relationships for privately held companies with sales in the $5,000,000. to $50,000,000. range, for a very well capitalized and well run top five banking institution in New Jersey. These are the small businesses that are the potential engine of economic recovery that will drive unemployment down and improve everyone's quality of life. Almost none of them are borrowing to expand productive capacity, hiring more people, buying other businesses, or making any significant business decisions that would require more than just a modest investment.
They are paying down debt, reducing their number of employees largely through attrition, and waiting for some certainty around the potentially devastating costs of Obamacare and some longer term stability in their expectations around the tax treatment of investing in productive capacity. They are also critically concerned about how their earnings will be taxed, and having more clarity around the variables involved in making sound judgements regarding the viability of borrowing/investing decisions.
There is little if any prospect of us experiencing, anytime soon, rapid economic growth, a decline in unemployment, or an improving standard of living under the current scenario. "Forward" means more of the same. Can we endure more of the same?
Well, there is a way to take action to help move us back in the right direction. Someone once said "All politics are local." We can all make a difference by helping make our voices be heard.
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