The Economy-Unemployment, Government’s Economic Policy, A Warning and Next Week

The Economy–Unemployment: The title of the article is “California’s Unemployment Rate Rises to 26-Year High (Update 1)” and it’s from a 3/21/09 Bloomberg.com post. The article is written by Bob Willis.

While the article responds to it’s title/headline, it goes further: “Unemployment in California rose to 10.5 percent from 10.1 percent in January…” and then “ Neighboring Oregon’s jobless rate rose a full percentage point to 10.8 percent, and Nevada’s increased to 10.1 percent.” (It’s our memory here at Prudent Home that, with the addition of Oregon and Nevada to the “ 10 percent or above club”, we now have at least five states with double digit unemployment: California, Nevada. Oregon, Rhode Island and Michigan.)

The Bob Willis piece contains a perhaps more chilling turn with an observation by the Chairman of The Federal Reserve, Ben Bernanke in remarks “… during congressional testimony on March 10 that it was “certainly within the realm of possibility” that unemployment nationwide could rise above 10 percent and stay there for a period of time.”

Government’s Economic Policy: The posting is from George Washington’s Blog of 3/20/09. (georgewashington2.blogspot.com) and is entitled “Krugman Slams Economic Team”

The article and the comment are sourced from Nobel economist Paul Krugman’s observations on the Obama administrations handling of the economic crisis. (Paul Krugman has been an informal advisor to the Obama administration concerning the current economic crisis.)

“At every stage, Geithner et al have made it clear that they still have faith in the people who created the financial crisis — that they believe that all we have is a liquidity crisis that can be undone with a bit of financial engineering, that governments do a bad job of running banks” (as opposed, presumably, to the wonderful job the private bankers have done), that financial bailouts and guarantees should come with no strings attached.”

A Warning: It’s Mike Folkerth – King of Simple at mikefolkerth.com on 3/20/09 that reminds all of us in America that we must be vigilant in our viewing the actions of our government especially in the area of finances. His post “Inflation Deflation, Stagflation, and Finally Depression” gives warning via a famous and timely quote from Thomas Jefferson – 1802:

‘I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around the banks will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered.”

Next Week: Prudent Home plans to discuss what some regular Americans are doing to deal with this economic crisis. Until then, keep your eyes on the horizon as the weather’s changing fast.