Weekly Economic News roundup

According to the Associated Press, New claims for unemployment benefits rose to 652,000 from the previous week's revised figure of 644,000 according to the Labor Department. The total number of people claiming benefits jumped to 5.56 million, worse than economists' projections of 5.48 million, a ninth straight record and the highest total on records dating back to 1967.

So, it’s not looking good. Or is it? Three days ago, the stock market had a one-day jump of over 500 points that could have been a good sign or just a fluke in the spiraling.


The unemployment rate for Feb. nationally was 8.1 percent, from 6.9 percent. According to a New York times article, the one-month jump was the largest on record. Michigan itself had a rate of 12 percent (according to a Detroit News Article).

In fact, a Business Week article suggested that even though the nationally unemployment rate is expected to be at 8.4 percent or so that it may look as though it’s stabilizing. This means that the worst of the whole recession could be behind us. The article, however, was quick to mention that even though the GDP recovers, it may not be able to stop the jobless rate from going as high as 9 or 10 percent. It’s all just speculation at this point.

And just because I like hearing about things abroad, the unrest about the employment has reached a terrible peak in France with workers protesting (when AREN’T they protesting, honestly?) by burning tires and marching on the Presidental Palace.
According to an article on Chron.com, Rising public outrage at employers on both sides of the Atlantic has been triggered by executives cashing in bonus checks even as their companies were kept afloat with billions of dollars in taxpayers’ money and unemployment soars. The controversy in France is against 3M, and Clairox (a tire maker). In fact, in France it’s gone as far as kidnapping of employers, marches, and strikes.

And the bailouts, according to the FBI, will lead to more Fraud cases, mentioned in a Reuters article. From the article: The expected surge in economic crimes will place further strain on an agency already stretched thin as it investigates mortgage fraud, terrorism and corrupt politicians, FBI Director Robert Mueller said.

If the bailout nationally were getting a lot of criticism and bad rap, it’s worse on the state level. From Mlive.com: “For the past month, Republicans have ridiculed Gov. Jennifer Granholm for only slashing $670 million from the fiscal 2010 budget and relying on Obamabucks to patch the rest of the $1.4 billion hole.”

In a Free Press article, however, Michigan Retailers have little faith in the stimulus (about 65 percent of retailers are saying that in the Michigan Retail Index) in that it won’t trickle down to them.

And, they might be right. Especially when a large lump sum comes into people’s possession, it seems as though they use the money to pay bills or to save the money for a “rainy day”. However, the stimulus package doesn’t allow for a large lump sum. It’s smaller increments over time.

However, the governor is positive President Obama’s plan will be beneficial to Michigan. From a Free Press article: the governor said federal officials prefer to call the American Recovery and Reinvestment Act, or ARRA, will bring about $18 million in spending to Michigan, creating or preserving about 109,000 jobs over two years.

Sources:

• Lansing: Through the looking glass”.
http://tinyurl.com/c4gkkm
• Vital Signs: Is Unemployment Near a Peak?
http://tinyurl.com/dgbgmg
• Stimulus Aid won’t help, most Michigan Retailers say http://tinyurl.com/c5vvd2
• Granholm: Stimulus Projects will lift Michigan’s future http://tinyurl.com/ckmy8v
• City jobless rate takes highest-ever one-month leap
http://tinyurl.com/c5jypg
http://tinyurl.com/dmuscl
• Bailouts fuel outrage in France, too http://tinyurl.com/dx3nym
• Stimulus, Bailout will lead to more Fraud: FBI http://tinyurl.com/dd358c