The Jobless Recovery and Other Fairy Tales

Dec 07 2009

The Jobless Recovery and Other Fairy Tales

Posted by Admin in Finance News

Tags: Jobless Recovery, Recovery | No Comments »

What is a “Jobless Recovery?” Ever heard the joke about economists? “If you laid all the world’s economists end to end, they still wouldn’t reach a conclusion!” The term “jobless recovery” has been bandied about recently to describe the “end of the recession,” and I’ve decided to add my ten-cents worth. The term was first used in the 1990’s by economists who noted that a country’s Gross Domestic Product could actually increase, even though unemployment figures were static or were continuing to rise.

Gross Domestic Product is nothing more than a figure, denominated in that country’s currency, that quantifies how much trade was done, both WITHIN the country and WITH other countries. So, if lots of trades are made using that country’s currency, and the trades make up an increased amount on the previous three months (a quarter), then the economy is said to be growing. Conversely, if the figure is less than the previous quarter, the economy is said to be slowing.

Think About It

What they are saying is in effect, because of mechanization, automation and sophisticated technology, and country’s output of products and services can increase, even though fewer people are working. This is not only true, but it is also a FACT. It CAN happen.

Good For The People?

Because of advanced technology, it’s possible for humans (in any country) to be more productive. The Industrial Revolution proved this point very well, with increased output in food production, manufactured products and speed of transportation of goods to name just a few things. So, that makes everybody better off, right? Not necessarily. Just because more products are being produced, and more services are being offered, doesn’t mean that the country producing them are any better off. Many times, the most productive countries have a very poor population (e.g. China, India) overall.

What’s Causing The Recovery

The “…….green shoots of recovery……..” that are meant to be sprouting must be based on SOMETHING, right?! I mean, things can’t just get better for no reason. So what IS the reason? Let’s think about it; it could be the new tele-transportation devices that have been invented and made so cheaply that everybody can travel anywhere within seconds. Or, it might be the free energy that we have discovered how to store and transport to everybody at no cost to them. Perhaps it’s the Time Machines that were devised recently and that are being used to go back in time and correct the financial mess that we’ve been thrown into? How about the fact that all humans have suddenly decided to get along by agreeing on one political system and one religion?

Facetious! Me?

Of COURSE I’m being facetious. My point is that NOTHING has happened to create a recovery from this depression (oops! I mean “recession”) and until that time comes (and it will be a long time coming) there will BE no recovery. After the stock-market crash of 1929, it took TWO YEARS before the Great Depression really started, and when it did, it lasted for a whole DECADE. In America, it wasn’t until the U.S. joined the Second World War that the recovery actually started. Yes, it took A WAR to get the economy growing again.

Why A War?

How could a war be good for the economy? Simple; it created lots of NEEDS. The needs were for new products and services to feed the war machine. Airplanes didn’t build themselves, nor did all the other equipment needed to fight the Nazi’s, Japanese and Italians (sorry if I forgot somebody). Today, we are in a similar BUT FAR WORSE situation than people 80 years ago. We have mortgages, credit cards and lots of other things that we have borrowed money for. The financial geniuses who have created all of these “investment instruments” (scams) have taken what we individuals have done and made it a thousand times worse.

The End of the World?

History will show this period to be one of MASSIVE change, both politically and physically. Like pulling off a band-aid, it’s going to hurt and it will hurt A LOT for a lot of people. Will we survive it? As a race (humans that is), we will most likely survive it. Humans might even come out of it as better people; more educated, more independent, stronger, more understanding and more creative. The harrowing experiences that we are about to endure will either make you or break you. As an individual, you should start preparing NOW for these changes. There really is no point in shutting the barn door AFTER the horse has already run away.

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