Nonfarm payroll employment fell by 240,000 in October, and the unemployment rate rose from 6.1 to 6.5 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today.
October's drop in payroll employment followed declines of 127,000 in August and 284,000 in September, as revised. Employment has fallen by 1.2 million in the first 10 months of 2008; over half of the decrease has occurred in the past 3 months. In October, job losses continued in manufacturing, construction, and several service-providing industries. Health care and mining continued to add jobs.
Our leaders keep scrambling to find stimulus packages. They are still talking about them. Talk. Talk. Talk. And throwing money at any problem it surfaces from banks to auto manufacturers. Improvising.
What intrigues me is that we knew last year of a credit crisis. We knew last year that it would have affected the economy in a negative way. Yet no plans were drawn for these emergencies. In fact, a presidential candidate was running on the idea of increasing taxes. It tells you how these people live in a different world.
It shows once again that bureaucrats react to the news. They do not try to anticipate. They cannot do it. It is not in their job description.
Social engineering created this mess. The markets always win and correct in a dramatic way the policy mistakes of any country. The bigger the mistake, the bigger the correction. The ultimate example is the USSR. Given what we are enduring, the attempt to provide a house to all of us independently of our means, was not the right policy.
A restrictive Fed from 2004 to 2007 precipitated the crisis and made matters much worse than they could have been.
More, much more of my analysis and recommendations when you read older posts in the blog archive and subscribe to The Peter Dag Portfolio by going to https://www.peterdag.com/.
George Dagnino, PhD
Editor, The Peter Dag Portfolio
Since 1977
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