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Economy Adds Only 36,000 Jobs in January

Posted Feb 4th 2011 5:20PM by Connie Madon (RSS feed)
Filed under: Economic Data, Federal Reserve

The jobs number is disappointing at best. Only 36,000 jobs were added in January, according to the Wall Street Journal. Dow Jones news wires had forecast an increase of 136,000. The unemployment rate fell to 9%.

The key reason for such a poor showing was bad weather. However, the December number was increased to 121,000 jobs, from 103,000.

Commenting on the jobs situation, Federal Reserve chairman Ben Bernanke said: "Until we see a sustained period of stronger job creation, we cannot consider the recovery to be truly established."

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Massachusetts postpones $750 million short-term debt sale due to credit crunch

Posted Oct 7th 2008 2:45PM by Joseph Lazzaro (RSS feed)
Filed under: Federal Reserve, Recession, Financial Crisis

To see the impact of credit market strain in the United States one need not travel farther west than The Bay State.

On Tuesday, Massachusetts, which would rank in the top 100 countries in the world in terms of GDP if ranked as a nation, postponed the sale of $750 million in short-term notes for the second time in two weeks, due to a lack of demand.

However, it should be pointed out that Massachusetts's decision occurred before the U.S. Federal Reserve's decision, announced Tuesday at 9 a.m. EDT, to buy all corporate commercial paper to ease tight credit markets.

Further, although the municipal market differs from the corporate commercial paper market, the Fed's action aimed at easing conditions in the credit market overall, via both guaranteeing debt payment and by moral suasion. Many economists see this as the Fed's attempt to change market psychology via the central bank's enormous financial resources, monetary policy stance, and regulatory powers.

Still, economists caution that the Fed's commercial paper guarantee does not end counterparty risk; it simply eliminates a segment of that counterparty risk. According to economist David H. Wang, more actions by the Fed and U.S. Treasury undoubtedly will be needed to get credit flowing more freely and also reduce perhaps the biggest systemic problem: fear. Commercial paper is about a $1.5 trillion market, while states and local governments borrow about $2.8 trillion, Wang said.

Continue reading Massachusetts postpones $750 million short-term debt sale due to credit crunch

Could U.S. economy, American people tolerate more government intervention?

Posted Sep 5th 2008 5:08PM by Joseph Lazzaro (RSS feed)
Filed under: Forecasts, Other Issues, Politics, Presidential Elections, Recession

Could the U.S. economy tolerate, and, equally significant, will the American people push the nation's chief executive, the president, in the direction of more government intervention?

The view from here is: probably not. Everything in the American ethos and culture speaks against it.

Unlike in France, where the French Government is simply, "France," Americans, for the most part, view their government -- save defense spending -- usually as part of the problem, not the solution. 'Government is best which governs least' is a longstanding Americanism. And most investors/readers know about candidates who say they want to "get the Washington bureaucrats off the backs of the American people" and "clean up the mess in Washington!"

Americans are anti-central government, and they are anti-state (they generally dislike the limited federal government that exists). In the United States, it is always private first, public second.

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