Big corporations got a little smaller in 2009.
In 2009, the total number of mass layoff events, at 28,030, reached its highest annual level since 1996, the first year for which these data are available.
The total number of initial claims for unemployment insurance benefits due to mass layoffs, at 2,796,456, was also the highest level on record.
Big Brothers (via Michæl Paukner)
“As highlighted by The Economist, only 400,000 more Americans were employed in 2009 vs. 1999 despite the fact that the population had grown by 30 million. Yet it gets worse — Not only has unemployment skyrocketed, but long-term unemployment has skyrocketed even higher.
The Economist: Long-term unemployment is what will make this economic downturn inordinately tough for many Americans to bear. Regardless of what headline U.S. GDP data may do, many of the people represented by the spike below will experience a multi-year personal economic downturn regardless.
Of course, it’s worth asking whether the skills they forget will even be valuable by the time things turn around.”
CHART OF THE DAY: Workers Are Unemployed So Long, They’re Forgetting Their Skills
“Think the U.S. is in a slump? Check out the World GDP numbers for 2009. The U.S. percentage of output has remained remarkably stable, even with recent economic troubles, even with spikes in contributions by so-called “Asian tigers” (rrrarr!) — India, China, and the like. But on a per-person, level how does the output of workers in other countries stack up against the output of U.S. laborers? FastCompany.com adjusted for population and crunched the data.”
Best Bodies, Global GDP Edition | The Upswing | Fast Company
Hidden doom: the U.S. is making the best (for now) of a bad situation.
The World’s Most Profitable Companies
Chart O’ Doom: Where Your Money Goes Edition!
continuum:socialsciencevisualized:
The US Credit Card Crisis. Dec 9 2009. By Derri Hassmi flickr.com
robot-heart-politics:thepoliticalpartygirl:pragmatism:
One sure thing about America other than baseball and hot dogs is its astronomical incarceration rate. View the graphic to find out the details.
Click to see the graphic!
Even as the BLS and the administration are trying to cover up the real state of unemployment affairs using assorted semantic gimmicks of just what it means to be unemployed, and as companies provide adjusted EPS numbers, while actual earnings continue to collapse, the true barometer of spending, provided by the Financial Management Service, tax withholdings (net of refunds), continues to paint the truest picture of just what is really happening with both America’s consumer and the corporate world. And it ain’t pretty. On a rolling 12 month basis, individual tax withheld has dropped by nearly 8% YoY, from $1.42 trillion to $1.31 trillion, while company witholding are down a whalloping 64%, from $274 billion to just under $100 billion! This is money that will never be used to pay down the skyrocketing US deficit, because both the US consumer and average US company are simply not collecting the required cash to line the Treasury’s pockets with the one traditional way to pad the deficit: taxes. Expect much, much, much more debt issuance in America’s short, medium and long-term future.
(via continuum)
CHART OF THE DAY: The Rest Of The World Owns Us
When investing in foreign bonds, there are two important risks. The first, interest rate risk, is the risk that interest rates will rise in the future, decreasing the market value of your bonds. The second risk is currency risk. As the value of the dollar falls against foreign currencies, the foreign investors lose money on their bonds unless the interest rate on the bonds is greater than the percentage gain by their own currency. As the US attempts to devalue the dollar, foreign investors might demand higher interest rates.
That’s potentially painful, but not exactly a DOOM scenario. Try this on for size:
There is a good chance that China will move from being a net exporter to a net importer in the next decade. As that happens, China will become less dependent upon the US for its growth. It is conceivable that China could eventually run a trade deficit with the US. At that point, China would benefit from relative strength in the Yuan. Contemplate what would happen if China were to dump all its US bonds at once. Bond prices would plummet and rates would skyrocket. US deficit spending would become prohibitive, interest rates on credit cards would make current usurious rates look tame by comparison, and economic collapse would ensue. Now, to preempt any argument that China would not take such an action against the US, I defer to wikipedia’s discussion of the Suez Canal Crisis:
The United States also put financial pressure on Great Britain to end the invasion. Eisenhower in fact ordered his Secretary of the Treasury, George M. Humphrey to prepare to sell part of the US Government’s Sterling Bond holdings. The Government held these bonds in part to aid post war Britain’s economy (during the Cold War), and as partial payment of Britain’s enormous World War II debt to the US Government, American corporations, and individuals. It was also part of the overall effort of Marshall Plan aid, in the rebuilding of the Western European economies.
Britain’s then Chancellor of the Exchequer, Harold Macmillan, advised his Prime Minister Anthony Eden that the United States was fully prepared to carry out this threat. He also warned his Prime Minister that Britain’s foreign exchange reserves simply could not sustain a devaluation of the pound that would come after the United States’ actions; and that within weeks of such a move, the country would be unable to import the food and energy supplies needed simply to sustain the population on the islands.
The US was willing to resort to such tactics against an ally. We rarely consider China an ally. Granted, China won’t resort to such tactics unless it is in the best interest of China, but that may happen sooner than most people expect.
