There may be some continued hope among the ludicrously optimistic that the current economic conditions will lead to a "soft landing" making it look a bit like most recent slow periods. The GDP dips for a quarter or two and then it is off to the races again.
Based on a self-examination, the US citizen does not find himself so terribly well off.
According to the AP," the Rutgers School of Management and Labor Relations said more than 10 percent of Americans are unemployed, discouraged from seeking work or underemployed. That is a nearly 25-percent increase from one year earlier". The "discouraged" and "underemployed" categories are especially important because they are self-selected. People are admitting that they are down on their luck. The optimism as leaked out of the confidence balloon.
The study also points out that median weekly earnings have not grown in eight years when the cost of living is taken into account.
Every rube who was given a credit card by some big bank has now run up the limit. The same lender probably also gave the poor soul an home-equity loan. Now that borrower is lucky to be able to scratch up the cash to pay for his mortgage and car coupon within the same month.
What is nerve-racking about the data is that a really deep recession could drive the number of people who believe that they are behind the employment eight ball to fifteen percent of the work force or better. That would be a crucible that that even the resilient US economy of the last decade could not handle. Even the recession of 1973 was not driven down by forces that ugly.
The UK chancellor recently said that the economy in his nation was probably hitting a 60-year low. England is not the only place where the scaffolding is falling.
Douglas A. McIntyre
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