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[Don Bowen <don.bowen AT earthlink.net>]

Lynda wrote:
> Yes, I can't figure how the recession is over when the unemployment numbers 
> keep rising.  Must be the "new" math they teach in public schools.
>   
Unemployment and the start or end of a recession have little 
connection.  The start or end of a recession is measured by increases or 
decreases in GDP.  If GDP increases so many quarters in a row then the 
recession is over according to the numbers.  GDP has fallen dramatically 
so small increases will do little to improve employment numbers. 

There is little in the numbers to indicate employment will improve 
anytime soon.  Due to policy makers deliberate decisions in the late 80s 
the so called FIRE (Financial, Insurance, Real Estate) industries were 
supported and others allowed to slip to low wage and minimal oversight 
countries.  70% of the US GDP was in consumption, mostly of goods from 
low wage countries and paid for with a bubble economy financed by the 
return of monies sent to the producing countries.

GDP may be stabilizing and increasing slightly thus being a technical 
end of the recession but employment may never return.  There are just 
too many shocks waiting on the sidelines to hammer down any real 
recovery.  You will see one when you visit the gas pump.  Oil is 
remaining over $80 and pump prices will be over $3 in most of the 
country this summer.  Manipulated inflation numbers and high 
unemployment mean no increase in transfer payments or wages for the next 
several years.

As for unfounded  fears of hyper inflation, there is little chance of 
that for several years.  The amount of money destroyed from middle class 
balance sheets and money pushed into the casino economy is not available 
for circulation and the afore mentioned downward pressures on incomes 
will remove more money from circulation.  Deflation is the real concern 
now as house prices continue to fall and companies push products with 
heavy discounts.

--
Don Bowen           KI6DIU
http://www.braingarage.com/Dons/Travels/journal/Journal.html