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The way to crush the middle class is to grind them between the millstones of taxation and inflation. – Vladimir Lenin

Housing Down Again 11%, Consumer Confidence Down, Underemployment Up, Elite Media “Surprised” Yet Again that Unemployment Claims Rise..

Posted by iusbvision on February 25, 2010

You have seen most of the press spin on how great the economic recovery is. The AP, at least online pointed out that the 5.7% GDP growth really wasn’t a turn around in the economy and I explained why that was. Now the evidence is in and once again the numbers show that our analysis was correct.

Karl at hotair.com had some of the same fun we have had as of late:

Media shocked by totally predictable “unexpected” rise in jobless claims

When it comes to the establishment media — and the economists in their address books — their chief weapon is surprise (and a fanatical devotion to The One):

The number of U.S. workers filing new applications for unemployment insurance unexpectedly surged last week, while producer prices increased sharply in January, raising potential hurdles for the economy’s recovery.

***

The rise in jobless insurance claims dealt a setback to hopes the economy was on the verge of job growth and could increase political pressure on President Barack Obama, who has made tackling unemployment his number one priority.

This surge in claims puts a damper on the last report, in which the unemployment rate dropped unexpectedly. However, it is consistent with the recent trend of unemployment news being “unexpectedly” bad again and again and again and again and again and well, you get the picture.

 

No consumer confidence means no investor confidence which means people spend less and people get laid off from work. As my teenager might say “DUH!” But as usual the elite media doesn’t want to get it.

Bloomberg News:

Feb. 23 (Bloomberg) — Confidence among U.S. consumers fell in February to the lowest level in 10 months, a sign that concern about job prospects may hold back the spending needed to sustain the recovery.

The Conference Board’s confidence index slumped to 46, below the lowest forecast in a Bloomberg News survey of economists, from 56.5 in January, a report from the New York- based private research group showed today. A separate report showed home prices rose for a seventh month.

Stocks fell and Treasuries gained after the confidence report also showed attitudes about current conditions fell to the lowest level in 27 years and the outlook for wages dimmed. The survey reinforces expectations Federal Reserve Chairman Ben S. Bernanke will repeat the central bank’s pledge to keep interest rates low for “an extended period” in testimony to Congress tomorrow.

“Consumer spending is going to disappoint throughout most of the year,” said Steven Ricchiuto, chief economist at Mizuho Securities USA Inc. in New York. The economy “may not be out of the woods.”

Economists forecast the confidence index would decrease to 55 from a previously reported 55.9 January reading, according to the median of 68 projections in the Bloomberg survey. Estimates ranged from 50.9 to 59.

The Standard & Poor’s 500 Index declined 1.2 percent to 1,094.6 at 4:05 p.m. in New York. The 10-year Treasury note rose, pushing down the yield 11 basis points to 3.69 percent.

 

Associated Press:

New home sales drop 11 percent in January, new low

New home sales plummet 11 percent in January, the 3rd monthly decline in a row

WASHINGTON (AP) — Sales of new homes plunged to a record low in January, underscoring the formidable challenges facing the housing industry as it tries to recover from the worst slump in decades.

The Commerce Department reported Wednesday that new home sales dropped 11.2 percent last month to a seasonally adjusted annual sales pace of 309,000 units, the lowest level on records going back nearly a half century. The big drop was a surprise to economists who were expecting a 5 percent increase over December’s pace.

While winter storms were partly to blame, home sales have fallen for three straight months despite sweeping government support. Economists were already worried that an improvement in sales in the second half of last year could falter as various government support programs are withdrawn.

“There is no doubt that January and February are going to be messy months for housing, given the severe weather conditions, but that doesn’t take away from the fact that the housing sector has taken another big step back, even with the government aid,” Jennifer Lee, a senior economist at BMO Capital Markets, said in a research note.

 

Gallup:

Gallup’s new daily metric estimates that 30 million U.S. workers were underemployed in January

by Jenny Marlar

WASHINGTON, D.C. — Gallup’s daily measure of U.S. employment reveals that 19.9% of the U.S. workforce was underemployed during the month of January, translating to close to 30 million Americans who are working less than their desired capacity. Those who were underemployed reported spending 36% less than those who were employed, $48 per day versus $75 per day.

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