Opinion

The Great Debate

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Reaction to shocking jobless data


November's job losses were the steepest since December 1974, when 602,000 jobs were shed. Analysts polled by Reuters had predicted a reduction of 340,000 jobs.

"This is a clear employment blowout. Firms are reacting as dramatically as they can to make sure they have cost structures they can survive the recession we are in," said Joel Naroff, president of Naroff Economic Advisors.

One reader commenting on the site feels the job losses have not hit bottom. "I predict 30% unemployment by March of 2009. The retailers are gonna tank right after Christmas. Look for some really good deals!" wrote Smacktle.

Not all responses were as dire.

"Well these are pretty bad numbers. This will be a real test to see how much bad news is priced into the markets. Futures are down quite a bit, but I actually expected them to be down a lot more given these terrible recessionary numbers," says Jeff Kleintop, chief market strategist for LPL Financial in Boston.

"It might be hard in future months to get numbers that are any worse. It might be good that we raced to some of the worst numbers we've had because perhaps it can't get incrementally worse."

After victory, a reality check for Obama

diana-furchtgott-roth– Diana Furchtgott-Roth, a former chief economist at the U.S. Department of Labor, is a senior fellow at the Hudson Institute. The opinions expressed are her own. —

By Diana Furchtgott-Roth

Pity President-elect Barack Obama. Today, only three days after his historic victory as the first African-American elected president, the Labor Department announced that the economy lost 240,000 jobs from payrolls in October and that the unemployment rate rose to 6.5%. This underscores the difficulties he faces in raising taxes on “the rich” to fund new spending.

Obama must recognize that his campaign promises are impossible to implement without making the economy sicker. The economy is weak and getting weaker, probably contracting now at an annual rate of 3-4 percent.

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