THREE REASONS THE RECESSION ISN’T OVER

The government and Wall Street want the recession to be over. My mother used to tell me, “Just because you want it to be so don’t make it so.” Her point was just because you want something to be a certain way simply saying it doesn’t make it true.

1. Jobs
The United States continues to lose more than 250,000 jobs each month. That is staggering! The true unemployment percentage is closer to 15% not 10%. Those who have taken part-time work are not counted as unemployed. If you go from a $40,000 salary to part-time 20 hours a week at $7.20 an hour it is hard to say “employed”. It is more like survival! Also, not included in that unemployed number are those who quit looking and those who took early retirement.  It is easy to project a “true” unemployment rate of 20% by March 2010.

There are no new manufacturing jobs.  Businesses in the United States are mainly “Service” oriented. We have shipped the majority of the manufacturing jobs to other countries. Production lines are closed, utility prices are increasing and big government is killing small business.

2. Money
The government is printing worthless money.  There is no growth in the GNP (Gross National Product). The country as a whole is not producing goods to sale to other nations. The main form of income for government is becoming taxes collected from people and not from business.

As more money is printed its value drops because there is no collateral (more income).  As the value of the dollar falls the cost of goods and services rise (inflation). Without more production jobs there can be no increase in national income and printing more money means more inflation.

3. Energy
The simple fact is that energy costs will continue to climb as government forces more changes in the production of energy. Replacing coal-fired generating plants with gas/oil fired plants costs money. Gas/oil is far more expensive than coal. The incoming president estimated that Americans will pay A LOT more for energy because Obama wants to shift from coal to other fuels.

As energy prices climb, profits go down. Businesses will re-locate to countries with less restrictions and cheaper costs (energy).  Why have so many companies moved operations to China? Cheaper labor and cheaper energy!

Is the recession over? No, it is in a lull and as more people are unemployed and the government prints more money and borrows more money from China things will only get worse.