Economists see jobless surge, deeper housing hole

[OhioChick]

Source: Reuters

6 Jan 2009, 0503 hrs IST, REUTERS

NEW YORK: The worst financial crisis in more than a half century is going to get even worse, putting further pressure on U.S. home prices and driving the unemployment rate above 11 percent, according to two prominent academic economists.

Carmen Reinhart, from the University of Maryland, and Kenneth Rogoff, of Harvard, suggested housing might not bottom until 2010, which bodes poorly for struggling banks that still hold trillions in mortgages.

"Financial crisis are protracted affairs," Reinhart and Rogoff wrote in a paper presented at this weekend's annual meeting of the American Economic Association, in San Francisco.

The two emphasized that, despite the best efforts of governments and monetary authorities around the world to stem the crisis, policy measures can only do so much to contain the aftermath of the largest debt bubble in modern history.

"Some central banks have already shown an aggressiveness to act that was notably absent in the 1930s," they said. "On the other hand, one would be wise not to push too far the conceit that we are smarter than our predecessors."

They said that on average the examples they studied as comparisons, which included rich countries like Sweden and Japan as well as poorer developing nations such as Malaysia and Thailand, the unemployment rate rose an average of 7 percentage points over a four-year period. Given that U.S. unemployment bottomed at 4.6 percent in late 2006, this would take the eventual rate above 11 percent.


Read more: http://economictimes.indiatimes.com/International_Business/Economists_see_jobless_surge/articleshow/3940274.cms

[Skittles]

1. things getting bad, Chick

layoffs aplenty at my company....plus so many friends with other companies. I emailed a joke to an ex-boyfriend in Austin, he replied back and let me know his last day was Jan 8 - so I forwarded his email to another friend in Austin asking to let him know if there were any openings - that guy responded back to me that HE was getting let go at the end of this month. Fucking bush legacy.

[OhioChick]

3. I hear you, Skittles....

Pink slips are in abundance here, too. There is nothing out there....

Did bush touch anything in his 8 years that "didn't" turn to shit?

[MUAD_DIB]

4. Yes, his and Dick's retirement. I doubt that they will be brought to justice.

[OhioChick]

5. Unfortunately, I think you're right. n/t

[proudAZdem]

10. What's worse than pink slips?

Being fresh out of grad school with very few prospects. Yeah, I've found a few jobs that will pay the bills, but I was hoping for a little more.

Thanks, Bush and neocons! I love this whole small gov't, help yourself mentality...look at what it's gotten us.

Bush has my vote for worst president ever. By the way, I love how he's rewriting his history as he leaves office: http://tv1.com/playlists/123

[OhioChick]

11. I feel for you....

Fresh out of school (likely with student loans) and no decent employment. Shows that a degree means jack shit, anymore.

Welcome to DU. :hi:

[silverojo]

14. Actualy, pink slips are worse

Fresh out of grad school, you're pretty young, which means you don't have a large family to support.

Older workers getting pink slips...all those hungry mouths to feed...that's when things REALLY get ugly. :(

[Skittles]

16. I sympathize

the bush legacy is hitting us all

[David Dunham]

2. This is overly pessimsitic.

[know_your_enemy]

6. #1 Recruiting Tool For the Military

Specifically the Army is Poverty. I was in the recruiting station the other day talking to a friend of mine and he said that people as old as 50 were coming in asking for options.

People are desperate. I read somewhere where the Army is now lowering the BMI standards for enlistment. They are also coinciding this change in policy with an aggressive campaigns in High Schools and Colleges, where college students are now sitting with defaulted loans.

They are wolves looking for meat, and these days it is abudant.

[OhioChick]

8. I did read recently that

Many were signing up for the military as a last resort due to joblessness.

[L0oniX]

13. God ...does anyone besides me think its terrible to take a job killing people?

I know that's not what everyone does in the military but everyone in the military plays a part in the killing. Would people really rather learn how to kill and kill than to be out of a job and possibly homeless? I don't see the homeless that I work with taking that option.

[natrat]

7. and steny hoyer and the republicans fiddle while rome burns

[kitfalbo]

9. My Economic response

Not to say the Economy is star wars but....

[CoffeeCat]

12. Unemployment and a bad housing market = VERY bad...

When someone is unemployed, they look for a job knowing they have to be flexible--and possibly move to a new city or state.

In a poor economy like this, gone are the days when you can only search locally and expect to find a job.
Especially, if you are living in a depressed area or in an area that has been hit particularly hard by
these poor economic times.

So, many people must move to find employment. The problem is...the housing market is so bad. People
cannot sell their homes. They can't get out of their mortgages to move on to another job--if they're
lucky enough to find one, that is.

I just talked with a fired trans/log vice president. He has to look nationwide for a job. So far, his house
has been sitting on the market for 4 months.

Bad situation.

[ananda]

15. I'm certain that unemployment is already ..

.. well above 11% in actual numbers.

[pfitz59]

17. Help Wanted section in this Sunday's paper

was 2 pages long.. In a county of 500,000 people! There are few jobs! My company is hiring, but criminal background checks and driving record checks shrink the eligible applicants. Retail sales are abysmal. Everyone appears to be in a holding apttern 'til Bush* departs.

[Azlady]

18. I think the unemployment numbers are way too low -

knowing so many people unemployed at this point. It will be interesting to see if Obama can get to the real numbers of how many are jobless. So many off the unemployement records at this point. I am so tired of reading/listening to the news, blaming people for living beyond their means. We lived WELL within our means, did it all right and are now behind the eight ball, BAD, with no signs of jobs out there, have no idea what we are going to do.