Stimulus vs. Unemployment

October 7, 2009

Correlation isn’t necessarily causality. Then again

100709stimulus

5 comments

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[...] There is a move afoot among Democrats to soften us up for some form of value-added tax (AKA: the VAT) like many countries have in Europe. Both the White House and the Democratic leadership in Congress are big fans of slapping a national sales tax down on top of all the other taxes we’re paying on the mistaken notion that it will help reduce the President’s staggering deficit and somehow pay for Obamacare at the same time while not doing an ounce of damage to an economy already badly-wounded by progressive financial shenanigans. [...]

Yea, that graph looks fairly damning, except that the effects of stimulus, in terms of job creation and projects will probably not be seen until late this year and in 2010.I must admit though, that here in NJ, I have noticed multiple roads projects being started, restarted, and completed. At least the stimulus is having some impact.

Posted by Greg | Report as abusive

While I think it’s too early to examine the full effects of the stimulus, and given the govt’s lack of foresight in dealing with the problems, there should be a lag in this relationship. Nevertheless, I think people need to recognize that we are in a new normal where structurally high unemployment is a given, because of the lack of manufacturing jobs and the plethora of jobs that were tied to the FIRE industries. So all of this stimulus money in my opinion does far more harm than good. It only temporarily creates jobs, but further adds to our ridiculous deficits and further weakens the dollar. Speaking of the dollar, it is approaching new lows for the year, and one of the only ways I feel for people to protect themselves against a weaker currency is to invest in gold related assets. While doing my usual weekly blog read I came across some interesting at http://www.goldalert.com that discuss the government’s role in creating persistent inflation by printing money to fund the large deficits. One article in particular I found good was “Gold Price and Negative Nominal Interest Rates”, which discusses the relationship between the Federal Reserve and the gold price. So while people most likely will continue to struggle with employment, at least there is an asset that should continue to benefit from the govt’s efforts to deal with this problem.

Posted by mthomas | Report as abusive

Unemployment is rising.

Posted by Camron Barth | Report as abusive

Now at 10.2

Posted by Camron Barth | Report as abusive

We’ll have November’s numbers in a few days.

Posted by Camron Barth | Report as abusive