The Huffington Post |                                                                                                


Bill Clinton Jobs

Bill Clinton said at the Democratic National Convention on Wednesday that Democratic presidents have overseen the creation of nearly twice as many jobs as Republican presidents. This is true.

Former U.S. President Bill Clinton highlighted a stunning fact during his speech at the Democratic National Convention on Wednesday: Democratic presidents have overseen the creation of nearly twice as many jobs as Republican presidents since 1961.

“What’s the job score? Republicans, 24 million; Democrats, 42 [million],” Clinton said to cheers and applause.

Bloomberg Government first reported these figures in May, after analyzing growth in private-sector jobs since 1961.

On Wednesday, Clinton used the figure to justify Democratic policies.

“It turns out that advancing equal opportunity and economic empowerment is both morally right and good economics,” Clinton said. “Why? Because poverty, discrimination and ignorance restrict growth. When you stifle human potential, when you don’t invest in new ideas, it doesn’t just cut off the people who are affected; it hurts us all.”

That said, Democratic presidents may not be able to take all the credit for the private-sector jobs created during their tenure. After all, the economy saw a big boost under Clinton in part because of the technology boom and stock market bubble that resulted — Clinton arguably was just in the right place at the right time.

Presidents’ economic policies clearly play some role in the job growth that results while they’re in power, however. And on that measure, both President George W. Bush and President Barack Obama have performed very poorly. An average of 63,500 jobs were created per month during Bush’s tenure, according to Labor Department data. Under Obama, an average 62,500 jobs have been created per month when taking into account job losses at the beginning of his tenure.

Presidents of both parties have implemented policies that may have stifled job growth for future presidents. For example, it was Clinton who repealed the Glass-Steagall Act, which had separated investment banking from consumer banking. Some say the repeal of Glass-Steagall played a major role in the financial crisis, since it helped allow banks to become too big to fail.

The subsequent financial crisis also happened on Bush’s watch, and Obama has been saddled with much of the job wreckage that resulted.

as reported in HuffingtonPost 11/30/2011

WASHINGTON — For the second year in a row, Congress must decide during the holiday season whether to renew federal jobless benefits for people out of work six months or longer. While Democrats have been making a huge fuss, with a press conference Wednesday featuring hundreds of unemployed workers, Republicans have been relatively quiet — but that doesn’t mean they’re against reauthorizing the benefits.

Republican leaders in both Houses of Congress have expressed support for continuing the benefits, saying the holdup is just a matter of how the legislation is put together.

“We’re going to be discussing between the House and Senate ways to deal with both continuation of the payroll tax reduction and unemployment insurance extension before the end of the year,” Sen. Mitch McConnell (R-Ky.) said Tuesday. “And in the end, it will have to be worked out in a joint negotiation between a Democratic Senate and a Republican House.”

If the benefits are not reauthorized, 1.8 million jobless will stop receiving checks over the course of January, according to worker advocacy group the National Employment Law Project. The federal benefits kick in for laid off workers who use up to six months of state-funded compensation without finding work. Congress routinely provides extensions during recessions and hasn’t dropped extended benefits with the national unemployment rate above 7.2 percent.

Yet the need to reauthorize benefits has been overshadowed by the looming expiration of a payroll tax cut put in place last December, which would result in a tax hike on every working American — an average hike of $1,000 — a scenario Republicans would like to avoid. And Congress also needs to pass a so-called “doc fix” by the end of the year to prevent a 27 percent cut in pay for doctors who see Medicare patients.

“Nobody is coming out with any definitive statements on [unemployment insurance]. Last year they were happy to,” Judy Conti, a lobbyist for NELP, told HuffPost. “I think it’s indicative of the fact that on a bipartisan basis people understand that workers families and the economy need these programs to continue.”

HuffPost readers: Worried your benefits will stop because of Congress? Tell us about it — email Please include your phone number if you’re willing to do an interview.

// // The sticking point over renewing the benefits through next year will be their roughly $50 billion cost. Republicans typically insist that the aid must be “paid for,” but that calculation may not apply if the benefits can be attached to something attractive like a tax cut. Republicans blocked renewed unemployment aid last year until President Obama agreed to extend the Bush-era tax cuts for two more years — at a cost much greater than unemployment. Earlier this year President Obama pressed Congress to pass a jobs package that included many items Republicans favored — for instance a “Bridge to Work” training program — but so far congressional Democrats have not signaled support for those programs.

Many members of Congress expected the deficit reduction super committee to craft a deal that included the benefits, but the committee turned out to be less super than advertised.

“Any kind of grand deal that we’ve been after has eluded us,” House Speaker John Boehner (R-Ohio) said Tuesday, referring to the failed broader talks on the budget and debt. “So let’s try and work incrementally towards a conclusion this session that can benefit all Americans. Because we Republicans do care about people that out — that are out of work. We don’t want to raise taxes on anybody. We want to provide the help to the physicians and the providers in the health care arena in this country, and we want to make sure this country has a sound national defense policy.”

Even Sen. Orrin Hatch (R-Utah), who suggested during a standoff on jobless benefits last summer that unemployed people blow the money on drugs, sounded sympathetic to jobseekers on Wednesday.

“Nobody really has a real quick answer. We’re studying it, looking at it. We’re clearly going to have to do something — nobody wants to see people suffer,” Hatch told reporters outside the Senate floor on Tuesday. “There’s a huge underemployment rate as you know, of 16, 18 percent, somewhere in that area. People don’t even want to look for jobs anymore. There oughta be some incentives to find jobs, to get to work. It’s easier said than done. I think there’s a general consensus that we need to help people.”

What’s Going On

November 3, 2011

What’s going on?


That seems to be the big question…..


Everyone is asking



Marvin Gaye sang about it back in the 70’s


Yet we still are asking the same questions, today….



The economy almost collapsed


People started looking at….


How the government reacted…



Why did they not see it coming?



The stimulus failed…



And the people started saying…..



No More …….



The Teaparty came from a grass roots effort


And have grown to be a voice



They have endorsed……


Reducing government spending


Opposition to taxation in varying degress


Reduction of the national debt…


And the reduction of the Federal Budget Deficit



Their message resonated during the 2010 elections


As a result we saw a total shake up in Congress



Did we get any results???



The result was total gridlock!!!!!



I do not think that is what the Teaparty had in mind…



Closing down the government….



That will not resolve anything




Agreed…… the Government has grown too big


Agreed…… the Government must be held more accountable



The stimulus was needed…



But it was mismanaged


There was no accountability


It should not have been



Carte Blanche




All these events leading to the collapse


Did not happened overnight



We put faith in our elected officials



We too, turned a blind eye



Borrowing against inflated housing values



Margining accounts


We all allowed this to happen



We all drank the Kool-Aid



And must take responsibility




Now the voices are growing


We are the 99%



What started in New York City


Has grown not only throughout the US


But has seen its’ presence grow around the world



There is just not 1 message



They are saying enough is enough…




What happened to the American Dream?


The land of opportunity got up and went







They are calling for the end of corporate greed



Corruption and influence over Government



No more too big to fail



Where are the jobs





How long will this go on?



Is anybody listening?




I do not believe anybody is protesting


Against the successes of the few



In the past there was an unwritten law…



Let’s make this a win / win



The more you help us to become successful


We will work


To share those successes with you



That is how the American Dream grew



Each generation working to improve


The Quality of life


For the next generation



The United States was a beacon


Everybody wanted to come to America





We took our eye off the ball


After 911,



America was united


Patriotism was at an all-time high



Then we got involved in several wars



Without figuring out how to pay for them



There was no shared sacrifice



President Bush told everyone to go out and shop



The deficits started rising….



It took over 200 years to get to a $1 trillion dollars



Yet in less than 30years


It has ballooned to just under


$15 trillion dollars




There are hard and difficult decisions to be made



Not everyone is going to be happy



But are we all prepared to start sacrificing?



Are we going to commit ourselves to a worthy goal?




What will be the quality of life we pass on?



To our Children….



And our Grandchildren…..




Will we be known as the lost generation?



How did we ever….




Let it go so far?




We are the people



We must all take on a shared responsibility



Do what needs to be done



To right the ship


Steady the course



Fulfill the promise America


Has brought to all generations




Like our forefathers before us




When asked….


Is the quality of life we are passing on….


Better than that which we have experienced



Let us stand proud and say




As reported in the Huffington Post

Written by Robert Reich

It’s a perfect storm. And I’m not talking about the impending dangers facing Democrats. I’m talking about the dangers facing our democracy.

First, income in America is now more concentrated in fewer hands than it’s been in 80 years. Almost a quarter of total income generated in the United States is going to the top 1 percent of Americans.

The top one-tenth of one percent of Americans now earn as much as the bottom 120 million of us.

Who are these people? With the exception of a few entrepreneurs like Bill Gates, they’re top executives of big corporations and Wall Street, hedge fund managers, and private equity managers. They include the Koch brothers, whose wealth increased by billions last year, and who are now funding tea party candidates across the nation.

Which gets us to the second part of the perfect storm. A relatively few Americans are buying our democracy as never before. And they’re doing it completely in secret.

Hundreds of millions of dollars are pouring into advertisements for and against candidates — without a trace of where the dollars are coming from. They’re laundered through a handful of groups. Fred Maleck, whom you may remember as deputy director of Richard Nixon’s notorious Committee to Reelect the President (dubbed Creep in the Watergate scandal), is running one of them. Republican operative Karl Rove runs another. The U.S. Chamber of Commerce, a third.

The Supreme Court’s Citizens United vs. the Federal Election Commission made it possible. The Federal Election Commission says only 32 percent of groups paying for election ads are disclosing the names of their donors. By comparison, in the 2006 midterm, 97 percent disclosed; in 2008, almost half disclosed.

We’re back to the late 19th century when the lackeys of robber barons literally deposited sacks of cash on the desks of friendly legislators. The public never knew who was bribing whom.

Just before it recessed the House passed a bill that would require that the names of all such donors be publicly disclosed. But it couldn’t get through the Senate. Every Republican voted against it. (To see how far the GOP has come, nearly ten years ago campaign disclosure was supported by 48 of 54 Republican senators.)

Here’s the third part of the perfect storm. Most Americans are in trouble. Their jobs, incomes, savings, and even homes are on the line. They need a government that’s working for them, not for the privileged and the powerful.

Yet their state and local taxes are rising. And their services are being cut. Teachers and firefighters are being laid off. The roads and bridges they count on are crumbling, pipelines are leaking, schools are dilapidated, and public libraries are being shut.

There’s no jobs bill to speak of. No WPA to hire those who can’t find jobs in the private sector. Unemployment insurance doesn’t reach half of the unemployed.

Washington says nothing can be done. There’s no money left.

No money? The marginal income tax rate on the very rich is the lowest it’s been in more than 80 years. Under President Dwight Eisenhower (who no one would have accused of being a radical) it was 91 percent. Now it’s 36 percent. Congress is even fighting over whether to end the temporary Bush tax cut for the rich and return them to the Clinton top tax of 39 percent.

Much of the income of the highest earners is treated as capital gains, anyway — subject to a 15 percent tax. The typical hedge-fund and private-equity manager paid only 17 percent last year. Their earnings were not exactly modest. The top 15 hedge-fund managers earned an average of $1 billion.

Congress won’t even return to the estate tax in place during the Clinton administration – which applied only to those in the top 2 percent of incomes.

It won’t limit the tax deductions of the very rich, which include interest payments on multimillion dollar mortgages. (Yet Wall Street refuses to allow homeowners who can’t meet mortgage payments to include their primary residence in personal bankruptcy.)

There’s plenty of money to help stranded Americans, just not the political will to raise it. And at the rate secret money is flooding our political system, even less political will in the future.

The perfect storm: An unprecedented concentration of income and wealth at the top; a record amount of secret money flooding our democracy; and a public becoming increasingly angry and cynical about a government that’s raising its taxes, reducing its services, and unable to get it back to work.

We’re losing our democracy to a different system. It’s called plutocracy.

Robert Reich is the author of Aftershock: The Next Economy and America’s Future, now in bookstores. This post originally appeared at


Sunday, October 17, 2010; 2:32 AM

 As reported in Washington Post

Let us tell you an Ugly Truth about the economy, a truth that no one in power or who aspires to power wants to share with you, at least until after the midterm elections are over. It’s this: There is nothing that the U.S. government or the Federal Reserve or tax cutters can do to make our economic pain vanish overnight. There are no all-powerful, all-knowing superheroes or supervillains who can rescue or tank the economy all by themselves.

From listening to what passes for public debate in our country, you’d never know that. You’d think that the federal government could revive the economy quickly if only Congress would let it be more aggressive with stimulus spending. Or that the Fed could fix it if only it weren’t overly worried about touching off inflation. Or that the free market could fix it if only we made deep and permanent tax cuts.

Watch enough cable TV, listen to enough talk radio, read enough blogs and columns, and you’d think that they – the bad guys – are forcing the country to suffer needlessly when a simple and painless solution to our problems is at hand. But if you look at things rationally rather than politically, you’ll see that Washington has far less power over the economy, and far less maneuvering room, than people think.

“It’s endemic in our type of society that we always think there’s a person who holds the magic wand,” says Sen. Judd Gregg (R-N.H.), a fiscal conservative who isn’t running for reelection, so he can, well, be blunt. “But this society and this economy are far too complex to be susceptible to magic wands.”

Heaven knows we could use such a wondrous fix. Even though the Great Recession ended 16 months ago, according to the business-cycle arbiters at the National Bureau of Economic Research, that only means that the economy started to grow in June 2009. It doesn’t mean that the economy has healed. It certainly doesn’t mean that the recession’s victims have healed. Tens of millions of people are still economically wounded from declines in their home values and investment accounts. Worse, despite some modest employment growth we’re down almost 8 million jobs from the end of 2007, when the Great Recession officially began.

Now, on to the real problems in the economy: why they’ve been so resistant to the traditional cures of lower interest rates and higher government spending. And we’ll show you that, when you talk to them in private (albeit on-the-record) forums, people from across the political and economic spectrum agree that there’s no magic cure for what ails the economy.

The fact is that our nation has suffered a huge financial trauma, and it’s going to take years to get well again. This isn’t exactly unknown in Washington, but it’s not something people in power go out of their way to emphasize.

For President Obama, who campaigned on the promise of transformational change, it’s been especially tough medicine to deliver. Take his performance in a September town hall session on CNBC. People in the audience were looking for immediate solutions to their problems, and Obama seemed to struggle with how to answer them. You can see why. Look what happened to the last president who ran for reelection during bad economic times: George H.W. Bush, in 1992. Bush came under fire for not doing more to help people who lost their jobs in the recession that had started in 1990, and for not showing more empathy in public.

After losing to Bill “It’s the economy, stupid” Clinton, Bush blamed Fed Chairman Alan Greenspan for his defeat. (If Greenspan had cut interest rates, the thinking goes, it would have looked as though Bush were doing something.) Seven weeks after Election Day, the recession arbiters announced that the downturn had actually ended in March 1991 – some 20 months before the election. Bush was right, as it turned out, not to push for extraordinary measures. But tell that to the voters.

Not the normal recession

If you think Bush had troubles, imagine what Obama is wrestling with. Today’s economic problems have proved enormously resistant to the traditional rate-cutting cure Bush wanted “Maestro” Greenspan to order up. That’s because the Great Recession, whose aftermath we’re living through, was different from the 10 previous post-World War II recessions. Those slowdowns were caused by the Fed’s increase of short-term interest rates to combat inflation. Recessions caused by the Fed’s rate-raising could be cured by the Fed’s rate-lowering. If things looked especially dicey, the federal government would send people checks to generate economic activity and spur confidence.

But the Great Recession was different. It was triggered by a financial meltdown brought on by excessive lending, reckless risk-taking, the implosion of an unregulated shadow banking system that assumed that short-term money would always be available – and ignorant and careless borrowing by people and institutions. The recession’s genesis is why things are still sluggish even though the Fed has cut short-term rates, which it controls, to virtually zero and has forced down long-term rates, which it doesn’t control, by buying more than $1 trillion of securities in the open market and letting it be known that it and other central banks will buy more.

Yet although such “quantitative easing” – econo-speak for “printing money” – helped allay financial panic in 2009 by providing cash to institutions that needed it badly, it’s less effective and more risky to use it to stimulate the economy. Hence the knife fight at the Fed Board of Governors between the fans of quantitative easing and those opposing it.


Let us explain. Even though the Fed is very powerful, it’s not all-powerful, just as the United States is not all-powerful when it comes to its own financial affairs. The Fed has to worry not only about the U.S. economy and money supply but also about debasing the dollar too much too quickly, lest it spook the foreigners who finance our trade and federal budget deficits. If foreigners lose faith in the dollar’s value, it could run our interest rates up sharply and abort any recovery.

To its credit, the Fed – the one institution that because of its independence can actually act quickly without making a political show – sort of admits that its power is limited.

“Central bankers alone cannot solve the world’s economic problems,” Chairman Ben S. Bernanke said in a speech at the Fed’s conclave in Jackson Hole, Wyo., in August.

The Fed wouldn’t let us interview Bernanke about the limits of the Fed’s power. It’s easy to see why: He’d risk diminishing what remains of the Fed mystique by talking on the record about its limitations and problems.

However, former Fed vice chairman Donald Kohn, a 40-year Fed veteran, agreed to discuss those limits, provided we made it clear he was speaking for himself as an outsider, not for the Fed.

“The Federal Reserve can make a difference, but it doesn’t have a magic bullet,” Kohn said. “It can’t take a weak economy facing a lot of major challenges and rapidly turn it into a strong economy.”

Kohn isn’t alone in that view.

“The public has been sold this notion that somehow we can control the economy – that we can fine-tune it so we don’t get inflation on the upside, we don’t get recessions on the downside, [that] when something happens, they can step in and offset it,” says another longtime Washington insider, Douglas Holtz-Eakin. “The economics profession is painfully aware that this is just not true, and [that it] has a terrible impact on politicians, presidents in particular.”

Holtz-Eakin, president of the American Action Forum, a conservative think tank, was Sen. John McCain’s economic adviser in the 2008 campaign. He and his Democratic counterparts know the dirty little secret: that the huge financial trauma suffered by the economy won’t disappear overnight.

“No one has found a way to have an incredibly severe financial crisis and snap back a year or two later,” says Jason Furman, deputy director of the White House’s National Economic Council.

Losses: Plenty of them

Look at the numbers on the economy and you’ll see why. The biggest single source of wealth for many people – their home equity – has fallen almost 50 percent from its peak in 2006, according to Federal Reserve statistics. Loss: $6.5 trillion. U.S. stocks are still down 25 percent from their peak in 2007, their 75 percent gain in the past 19 months notwithstanding. Cost: $4.8 trillion. Then there are the 7.7 million lost jobs with their associated lost income, lost wealth and lost consumer spending. Loss: untold trillions of dollars.

This wealth-reducing trauma, combined with consumers becoming afraid to spend and lenders changing from being ultra-lax to ultra-strict, has sucked huge amounts of money from the economy. Don’t let occasional upticks in consumer spending, the stock market or home equity fool you into thinking that things are okay, because they aren’t.


“The economy suffered a really deep wound – it’s healing, and it’s a little bit uneven,” says Alan Krueger, assistant Treasury secretary for economic policy. “But that is what you’d expect given the loss of wealth from the financial crisis.”

People used to collectively spend more than they took home – hence, our negative national savings rate, which was covered by borrowing. Now we’re spending 6 percent or so less than we’re taking home. That’s a big head wind to fight. The switch from borrowers to savers augurs well for the long run, if the trend lasts. But in the short run, it hurts the economy by diminishing activity. Compared with all the losses we’ve talked about, the $814 billion in stimulus spending – the effectiveness of which we won’t get into today – is small beer.

So what do you do? One proposed solution is to jump-start the economy with deep and permanent tax cuts. That’s more than a little problematic, given that the Great Recession began in 2007, when tax rates, especially on investment income, were about the lowest in modern times and there were no “Obama tax increases” on the horizon.

President George W. Bush had pushed through two big tax cuts – one in 2001 because the government was supposedly taking in too much money, the second in 2003 to stimulate investment. But the economy tanked anyway. The latest tax-cut screed, the Republican Party’s Pledge to America, has no meaningful numbers, proposes no changes in programs like Social Security, Medicare and defense, and asks no sacrifices of anyone, yet it says it can balance the budget. Good luck with that.

What about having the Treasury engage in a massive stimulus program to put money in people’s pockets and have them spend it, ginning up economic activity and restoring confidence? But stimulus money has to come from somewhere – and it doesn’t seem possible for the Treasury to raise a few trillion more stimulus bucks without dire consequences to interest rates and the dollar’s value.

It doesn’t help that the administration wrongly predicted that its stimulus package would hold unemployment to 8 percent; the rate soared to 10 percent and still hangs stubbornly in the mid-nines.

Other institutions, such as the Fed and the Social Security Administration, both nonpartisan, also underestimated our economic problems. But the administration’s mistake, which seems to have been an honest one, has undermined its credibility.

The fact that stimulus programs seemed designed to favor unionized workers, a core Democratic constituency, didn’t help. Nor did the fact that Cash for Clunkers and the $8,000 credit for first-time home buyers caused one-time spikes in new-car and house sales that fell off sharply after the programs expired.

‘Quantitative’ what?

Our final little secret is that the United States is now being forced to live within its means, and that’s not fun. For years our country could spend and spend because two bubbles showered companies, consumers and governments with free money. Who needed to save when stocks were producing returns of almost 20 percent a year, which they did from August 1982 through the spring of 2000? Or when house prices rose at double-digit rates and you could get cash easily and quickly through refinancing, a second mortgage or a home equity loan? Homeowners raising and spending cash propped the economy for years.

The closest we’re likely to come to free money is the Fed’s proposed quantitative-easing moves to buy Treasury securities. Let us show you how it works – and the problems with it.

Let’s say the Fed buys $1 trillion of Treasury securities in the secondary market. Out of thin air, it creates $1 trillion in credit balances in the sellers’ accounts. The sellers have $1 trillion more cash than they did, increasing the money supply. There is now $1 trillion less in publicly traded Treasurys, which props up their price.

By contrast, if Goldman Sachs wanted to buy $1 trillion of Treasury securities, it would have to find $1 trillion of cash to pay for them. Sellers would have $1 trillion more cash than before. Goldman would have $1 trillion less. There would be no increase in the money supply or decrease in the Treasury supply.


If the Fed could buy endless amounts of Treasury securities without any side effects, it would be almost like free money. The securities would cost the Treasury little or nothing in the way of interest, because the Fed turns over its profits – $53 billion last year, $40 billion in the first half of 2010 – to the Treasury.

So if the Fed buys $1 trillion of 2.5 percent, 10-year Treasury notes, Treasury’s $25 billion annual interest expense is offset by the $25 billion of extra profit the Fed would make, all (or almost all) of which would be turned over to the Treasury. See? Isn’t that grand?

There is, however, a problem. The Fed can’t do that indefinitely without touching off inflation, debasing the dollar, or both. Markets are bigger and more powerful than the Fed.

Consider the reaction of people like veteran Wall Street value investor Hugh Lamle of M.D. Sass to quantitative easing.

“It’s one thing to do $800 billion once,” he says. “But if the federal government is going to print $1 trillion a year for five years, maybe I don’t want to be in dollars.”

A second factor is that long-term rates are already so low that it’s not clear how much stimulus you get from cutting them more. It’s a big deal to cut interest rates to 5 percent from 8 percent. But at lower levels, the result is less dramatic.

Do you think the difference between 3 percent and 2.5 percent is going to matter? Meanwhile, these ultra-low rates are penalizing American savers – especially retirees relying on CD income to supplement Social Security. They tend to spend all their income, and it’s down sharply. That’s one reason the economy is weak.

Don’t get us wrong, there are plenty of winners in this game – just not the ones who need help. Cash-rich corporations are issuing billions of dollars of cheap debt for purposes such as buying back stock rather than expanding and creating new jobs. Corporations have record cash on hand but aren’t using it to expand in the United States.

Banks, too, are profiting mightily from quantitative easing. They can borrow short-term money for essentially nothing, then buy Treasury securities, knowing that the Fed will support the securities’ prices by buying them in the market. Playing the yield curve is easier, less risky and more lucrative than what the government wants the banks to do, which is to make loans.

It comes down to housing

Perhaps the biggest problem we have standing in the way of having good times return is housing – which is an example of how deep-rooted our problems are and how resistant they are to government programs.

Housing was a major source of national wealth for decades, and home equity, however sadly diminished, is still the biggest single piece of wealth many Americans have. That’s especially true of lower-income people.

No one shouts this from the rooftops, but the federal government and the Fed are doing all they can to prop up house prices. Thanks to the Fed’s forcing down of long-term rates, fixed-rate mortgages are at record lows. Most of those mortgages come via Uncle Sam.

For the first half of the year, 89 percent of mortgages came from the government-run Fannie Mae, Freddie Mac, Federal Housing Administration and Department of Veterans Affairs, according to Inside Mortgage Finance. That’s almost triple the levels of housing’s peak years: 31 percent in 2005 and 30 percent in 2006.

Even with all that effort, though, housing prices may be stabilizing at levels far below their peak four years ago rather than recovering broadly.

When will house prices get back to where they were? John Burns of John Burns Real Estate Consulting, one of the nation’s savviest real estate analysts, invokes the seven-and-seven rule. In previous local-market bubbles, Burns says, “the rule of thumb is seven years down and seven years up” after the bubble pops. Apply that rule to the national market, where the bubble popped in 2006, and we’re talking about a sustained recovery starting in 2013, and taking until 2020. That’s pretty grim, but probably realistic.

So when are we going to know when things are getting better? They may, in fact, be getting better now, but it’s going to take a long time for the wound to heal completely. We need to take care of people who have lost their jobs and lost their hope.

But after the midterm elections, when there’s going to be immense pressure to adopt everyone’s programs, we can’t just throw money at everything, searching for magic cures and magic sound bites. If we do, it will take us that much longer to climb out of the hole.

Allan Sloan is senior editor at large at Fortune magazine. Tory Newmyer is a writer at Fortune. Doris Burke is a senior reporter at Fortune.


By Neil Irwin

Friday, August 27, 2010; 11:06 AM

JACKSON HOLE, WYO. – Federal Reserve Chairman Ben S. Bernanke acknowledged in a much-awaited speech Friday that the pace of economic growth “recently appears somewhat less vigorous” than expected, and said that the central bank would take new steps to bolster the economy if conditions worsen.

“The pace of recovery in output and employment has slowed somewhat in recent months,” Bernanke said at the Federal Reserve Bank of Kansas City’s annual economic symposium. “Despite this recent slowing, however, it is reasonable to expect some pickup in growth in 2011 and in subsequent years.”

Just this morning, the Commerce Department reported that gross domestic product rose at only a 1.6 percent annual rate in the April-through-June quarter, much worse than the 2.4 percent earlier estimated.

Bernanke said that the Fed’s policy committee “is prepared to provide additional monetary accommodation through unconventional measures if it proves necessary, especially if the outlook were to deteriorate significantly.”

“The issue at this stage” Bernanke said, “is not whether we have the tools to help support economic activity and guard against disinflation. We do. . . . The issue is instead whether, at any given juncture, the benefits of each tool, in terms of additional stimulus, outweigh the associated costs or risks of using the tool.”

In other words, the economy has not deteriorated enough, nor the outlook changed enough, to warrant pulling out some big new monetary policy guns, but the Fed would be willing to do so if its forecast of continued slow-but-steady growth proves to be overly optimistic.

Bernanke enumerated the policy options on the table. At recent Fed policy meetings, he said, participants have discussed renewed large-scale purchases of Treasury bonds and other securities; pledging to keep the Fed’s short-term interest rate target near zero for even longer than analysts now expect; or cutting the rate paid on money that banks park at the Fed.

However, Bernanke explicitly rejected a notion, advanced by some economists outside the Fed, that the central bank temporarily increase its target for inflation. “I see no support for this option” on the Federal Open Market Committee, he said.

In discussing the trade-offs involved in undertaking a major new program to buy securities and thus expand the Fed’s balance sheet to try to boost growth, which is the most powerful of the tools under consideration, Bernanke noted various risks: that the central bank lacks precise knowledge of what effect the action would have; that the action would have the most impact in a time of financial market distress; and that the bigger balance sheet “could reduce public confidence in the Fed’s ability” to unwind the policies.

The speech is one of the most hotly anticipated of Bernanke’s tenure as Fed chairman, especially on Wall Street. In recent weeks, the economic situation has deteriorated markedly, and many forecasters now expect that the U.S. economy will grow much too slowly to bring down the unemployment rate in the second half of the year. Fed watchers were eager for Bernanke to offer clarity on what the approach of Fed policy is over the months ahead, particularly following an action at its Aug. 10 meeting to reinvest proceeds from maturing mortgage securities on its balance sheet.

In discussing the economy, Bernanke adopted a mixed tone, expressing confidence in growth over the medium term while acknowledging that the situation is disappointing at the moment. “In many countries, including the United States and most other industrial nations, growth during the past year has been too slow and joblessness remains too high,” he said.

“Incoming data on the labor market has been disappointing,” Bernanke added, while business investment in equipment and software “should continue to advance at a solid pace.”

The major drain on second-quarter gross domestic product was from trade. “Like others,” Bernanke said, we were surprised by the sharp deterioration in the U.S. trade balance in the second quarter. However, that deterioration seems to have reflected a number of temporary and special factors.”

The revision to gross domestic product data Friday is only the latest reminder of how far the economic outlook has fallen. Just in the past week, new data have indicated that the housing sector was in near free-fall in July, that business orders for big-ticket equipment contracted that month, and that new claims for unemployment insurance benefits remained at recessionary levels last week.

Bernanke takes a measure of optimism from recent reports that Americans are saving more. Although a higher savings rate – about 6 percent, compared with the 4 percent earlier estimated – has helped depress consumption in recent months, in the longer term, he said, it “implies greater progress in the repair of household balance sheets,” which should in turn allow Americans to increase their spending more rapidly in the future.

In the speech, Bernanke made an effort to try to dissuade listeners from the idea that the Fed, or any central bank, can create a return to prosperity on its own. “A return to strong and stable economic growth will require appropriate and effective response from economic policymakers across a wide spectrum, as well as from leaders in the private sector,” he said. “Central bankers alone cannot solve the world’s economic problems.”

The Unknown Cost

January 25, 2010

The main topics being spun in Washington lately have been Health Care and the Bank bailout. What has been lost in the discussion is what must be done to get the economy moving and providing jobs for America. That seems to be the mantel that President Obama is just starting to pick up.

Every month the experts look to see the latest unemployment data; this proves to be a strong indicator on how and if a recovery is sustaining. Unfortunately, the unemployment report continues to be dismal. Just last week, I saw an article saying that layoffs were higher than expected in December 2009.

The unemployment rate is still over 10% and this will continue to play a large roll in supporting the economic recovery.

How does this all effect me?

Everyone reads about the rising unemployment, but have you ever stopped to think what this means for your company? You may say, “We have not had many layoffs, so it doesn’t really effect us.”

Don’t be too quick in making this assessment.

The unemployment is a state fund that all employers pay into. Each employer basically has a checking account with the state to help fund claims. The state assigns a rate to each employer, which determines what percentage of payroll is paid into the fund to pay for claims. The state will then notify each employer as to how much they have taken out of this account in payment of claims.

Seems simple enough!

Because of the high rate of unemployment, more dollars are being paid out in claims and there is not enough money in the fund to support these claims. We were lucky last year because part of the bailout went to funding this shortfall.

But, how does the state address this shortfall in funding?

If you look at the unemployment rating structure set up in New Jersey, you will see that there are six tables the state can use to fund unemployment. All they have to do is switch what table they use in assigning the rate and without notice you have just received a tax increase.

As an example: Suppose your company has a positive reserve ratio between 4% to 4.99%

In 2008 – the state assigned your unemployment rate from column A….. your unemployment  rate would have been 2%.

In 2009 – the state started assigning your unemployment rate from column B…. your new unemployment rate would have been 2.6%.

A 30% increase and nothing really changed!

In 2010 – the state is now looking to fund unemployment from column E+10%, guess what your new rate will be?….. 4.1%

That is over a 57% increase from last year. The rate would have doubled since 2008!

Note: This is just not happening in New Jersey, every state is faced with the same dilemma………. How do we fund the higher claim levels?

What is your current rate?

When was the last time you validated that your unemployment rate is correct?

Now more than ever, it would be prudent to ask this question.

There may be a mistake in the calculation or we may offer options that may help to minimize the potential increases in the long term.

We offer a free analysis of your existing unemployment rate.

Would you like to know more?  Email or call 856-857-1230

Unemployment is the 2nd highest employer mandated tax on employers. It is the only tax that you have as an employer, have the opportunity to determine what your rate should be.

To learn more about how the unemployment tax effects your business, you may visit our website or feel free to contact us.

WASHINGTON — President-elect Barack Obama on Saturday outlined his plan to create 2.5 million jobs in coming years to rebuild roads and bridges and modernize schools while developing alternative energy sources and more efficient cars.

“These aren’t just steps to pull ourselves out of this immediate crisis; these are the long-term investments in our economic future that have been ignored for far too long,” Obama said in the weekly Democratic radio address. The economic recovery plan being developed by his staff aims to create 2.5 million jobs by January 2011, and he wants to get it through Congress quickly and sign it soon after taking office.

He called the plan “big enough to meet the challenges we face” and said that it will jump-start job creation but also “lay the foundation for a strong and growing economy.”

Aides said the economic plan outlined Saturday went further that the president-elect has gone before.

Let us know your thoughs. Your comments are welcome.


Excerpts from


July 2 (Bloomberg) — Companies in the U.S. cut an estimated 79,000 jobs in June, a private survey based on payroll data showed.

The decrease was larger than forecast and followed a revised gain of 25,000 for the prior month that was less than previously estimated, the report from ADP Employer Services showed. Last month’s drop was ADP’s largest since November 2002.


The biggest housing recession in a quarter century and record oil prices are prompting an increase in firings as companies brace for falling demand. The government tomorrow may report that total private and government payrolls fell in June for a sixth decline this year, according to the median forecast in a Bloomberg News survey.


“Clearly, there is more weakness to come in the labor market,” said Anna Piretti, a senior economist at BNP Paribas in New York. “Risks are to the downside” for tomorrow’s jobs report.


Our perspective:


This morning, the NY Times reported that they see they see Deepening Cycle of Job Loss Seen Lasting Into ’09

Experts say the troubles dogging the economy will be stubborn, leaving in place a combination of tight credit and scant job opportunities perhaps well into next year.

That’s not good news.

Steps must be taken to start turning the tide. Strong leadership must come from one of the presidential candidates that will provide a vision saying “ I am going to take us out of this mess.” This will help to restore confidence. We saw that with FDR. He had a vision and he brought everyone together to rebuild America.

Now it is our turn. What are we doing to bring a better America to our children, the future rest in our hands?

Let us know your thoughts?