As you know instead of creating jobs the government is cutting them and trying to use Federal Reserve to get things moving. The Reserve is in charge of the money supply. For several years now it has been “printing” money and buying bonds to keep interest rates low. The idea is businesses will borrow the “cheap” money and expand and create jobs.
It hasn’t worked very well, but the official measure of joblessness (the unemployment rate) keeps on slowly falling. The head of the Reserve, Ben Bernanke, had said once the number goes below 7% he would stop buying bonds, but now he’s changing his mind because it’s impossible to pretend that the official unemployment rate really measures how bad the situation is.
This is from a report on Bloomberg business news.
“Unemployment fell to 7.3 percent in August from 7.4 percent in July and 7.6 percent in June as workers left the labor force and payrolls in the U.S. climbed less than forecast. The share of working-age people in the labor force declined to 63.2 percent, the lowest participation rate since 1978, from 63.4 percent in July.” The number I think best, E-Pop, the percent employed compared to the adult U.S. population, also worsened to 58.6%. It’s up just 0.4% from its record low this century (November 2010) and far worse that the “usual” 62 or 63%. See nice chart here. More about E-Pop on CNN’s site here.
Here’s a prediction. The government will not report worse jobs numbers in its next scheduled report on Friday.
That’s because the government will close on Tuesday.
More Can’t Pay Back Student Loans
Bloomberg business news reports that the rate of people not paying their student loans has gone up a lot. One in seven borrowers are not paying. The article says “defaults are at the highest level since 1995.” U.S. ex-students owe around $1 trillion on loans. The loans are iron-clad agreements. You can’t even dissolve them if you go bankrupt.
And for those who believe the claims of those private colleges who supposedly will train you for jobs, consider this. “Public colleges reported a 13 percent default rate while nonprofit private schools had a rate of 8.2 percent. For-profit colleges fared the worst, at almost 22 percent.”