"Genuine government stimulus comes from low taxes, stable prices, reduced regulation and low debt. Our economic policymakers have scrupulously avoided such remedies."
--Michael Pento, senior economist at Euro Pacific Capital
Lack of job creation continues to be a big knock against Obama’s management of the economy. Only 54,000 new jobs in May, with the unemployment rate back up to 9.1%. It takes 167,000 jobs a month to keep pace with population growth, and 157,500 jobs a month plus an unemployment rate lowered to 7.8% (see chart below) for Obama just to get jobs back to where they were when he took office.
Christine Owens, executive director at the National Employment Labor Project, tells us that with 1.8 million jobs created since 2010 and nearly 8.7 million jobs lost during the recession, there is still a deficit of 6.9 million jobs, not counting the 4.1 million needed to keep up with population growth. That’s a true job deficit of 11 million!
The month’s economic bad news also involves housing. The widely watched Case-Shiller Home Price index fell by 4.2% in the first quarter, a 5.1% drop year-to-year. This lowered the overall price level to where it was in 2002, and means US home values have now fallen by a third from their 2006 peak—a bigger housing price drop than even during the Great Depression!
One big reason housing prices keep falling—our country isn’t creating the jobs that build demand for new homes.
The New York Times’ Nate Silver has an article debunking any relationship between the unemployment rate and Obama’s re-election chances. I find the article unpersuasive; a statistical smokescreen blotting out the real world. People understand the unemployment rate the same way they understand that Osama bin Laden is dead, not alive. The unemployment rate tells people whether or not Obama’s doing his job.
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