Carelessness, Aimlessness and JoblessnessOctober 22, 2012 Posted by: Joe Morgan, CFA
Tumble outta bed
And stumble to the kitchen
Pour myself a cup of ambition
Yawnin, stretchin, try to come to life
Jump in the shower
And the blood starts pumpin
Out on the streets
The traffic starts jumpin
And folks like me on the job from 9 to 5
According to the Bureau of Labor Statistics, close to 600,000additional Americans will not need to "tumble outta bed" so earlyin February - except perhaps to fight the long and growing lines atthe unemployment office. For the third month in a row, nonfarmpayrolls fell by over half a million jobs, bringing the totalnumber of jobs lost to 3.6 million since January 2008.
With over half of those jobs disappearing in the last three months,it's difficult to imagine the remainder of the economy has felt theeffects. Certainly those in power to effect change haven't.
Given a nonfarm work force of approximately 132 million, aboutthree percent of American workers have lost their jobs. A "fair"distribution of this pain would include three senators and 13congressmen who would be out on the street, not to be replaceduntil the economy recovers.
Instead, debates ensue and political jockeying increases as thefear of losing reelection and having no sweet lobbying position tofall back on metastasizes. Fear can be a great motivator, but itoften obfuscates the best path toward salvation.
Unfortunately, there have been several instances recently wherefear simply paralyzed, leading to greater uncertainty and lowerconfidence.
The first was of course the initial TARP bill which was passedunder the premise the Treasury would buy up "troubled assets" frombanks in order to allow them to move on with any lendingopportunities. By relieving them of this ball and chain, thebanking system would be left more agile to seek profitable lendingand investing opportunities, while the taxpayer would receive anybenefit or detriment to holding those securities.
Instead, Hank Paulson changed course and used his new authority toinject capital into the banking system. Because the market was setup for him to go one...Read More