Unemployment falls to 9 percent, lowest since 2009 … The unemployment rate is suddenly sinking at the fastest pace in a half-century, falling to 9 percent from 9.8 percent in just two months — the most encouraging sign for the job market since the recession ended. More than half a million people found work in January. A government survey found weak hiring by big companies. But more people appear to be working for themselves or finding jobs at small businesses … Eisenhower administration is the latest sign that the economic recovery is picking up speed. The service sector and manufacturing are growing again at pre-recession rates. The Dow Jones industrial average closed above 12,000 this week for the first time since mid-2008. And retail sales have reached a five-year high. – Yahoo
Dominant Social Theme: After tough times, the magnificent "can do" spirit of Americans is beginning to pull the country out of recession. Americans are a proud and productive race. You can't keep them down.
Free-Market Analysis: We are glad that the terrible unemployment that America is facing has subsided. This is what happens when the vital energies of the most innovative country in the world are challenged: American citizens respond magnificently. The country's largest, dynamic corporations – Boeing, General Electric and General Motors – use recessions to discipline costs and create new, streamlined product. Fat is cut and muscle is strengthened.
No less a publication than the Economist has noted the beginning of the end of the jobless recession. In a recent article, this august tome explained the following: "There's still a lot of misinterpretation of the drop in the unemployment rate from 9.4% in December to 9.0% in January. Some on Wall Street say it's a bad sign, attributing it to a decline in the labor force as people gave up looking for work. But that decline in the labor force is a statistical illusion. When you remove that illusion, the entire drop in the unemployment rate can be attributed to the unemployed finding jobs."
This is great news. A publication apparently affiliated with the Rothschild banking family – a self-described newspaper that proudly presents itself as one of the most trusted periodicals in the West – has made the determination that US unemployment is down. The figures released by the US government can be trusted after all.
OK, sarcasm off. In fact, the unemployment situation in the US – and in the West generally – remains disastrous. Alternative ‘Net news organizations estimate US unemployment to be in the area of 20 percent; and we believe it is likely much higher than that. Even some mainstream media voices cannot keep up the pretense that the economy is turning positive again. The website and news organization BMI informs of us the following:
[Chief among the less trusting] is CNBC's floor reporter Rick Santelli, who recently criticized 'kool-aid drinkers' [on-air] for trying to find good news in the 'disappointing.' Jobs are heading up and down at the same time. The Bureau of Labor Statistics announced the morning of Feb. 4 that only 36,000 jobs were added in the month of January, but the unemployment rate dropped from 9.4 percent to 9.0 percent.
Santelli even lashed out at some of the CNBC "Squawk Box" panel that were discussing the latest jobs report. "[W]e have overwhelming evidence the jobs market is disappointing, and all of you are trying to look for that one half of spaghetti in a 50 lb. spaghetti bowl. This is not great data," Santelli claimed. "In terms of jobs … if you work just one day. If you stay home but you get paid you're counted in the data."
Santelli is being as honest as he is allowed to be (and maybe pushing the boundaries besides) but what he isn't explaining is WHY the numbers remain stubbornly slow, going into either the third or fourth year of America's longest "recession" since the Great Depression of the 1930s.
The reason, as we've explained before on numerous occasions has to do with the US economy's larger distortion. 20th century central banking, especially after its removal from the remnants of the gold standard, was hugely expansive (and still remains so, to less and less effect). Money printing bloats every kind of industrial activity and in the past has caused a huge upswelling in white-collar jobs (complete with degree inflation as well) – mostly for lawyers, accountants and corporate bankers (commercial and investing).
The result in America was a faux economy that still has not subsided. America, more than any other country, was able to build such an economy because the dollar was the world's reserve currency. This meant that America's central bankers could virtually print dollars at will and the rest of the world had to absorb them in order to be able to buy Middle East oil that was priced in dollars.
The American economy of the late 20th century recycled cars and white ware regularly, built ever-more massive McMansions, cultivated an impossibly large military industrial complex complete with increasingly useless weapons systems, expanded a kind of domestic STASI complete with 16 spy agencies, warrantless wiretapping and rendition abroad for purposes of torture. None of this contributed to the "productive economy" and all of it is quite questionable in terms of the evolution of a real economy, unencumbered by fiat money stimulation.
Eventually, in such cases, economic distortions simply grow too much to bear. The dollar-reserve system crashed in 2008 and has not yet recovered. In fact, it cannot recover because the same central bankers that caused the crash have pumped an unholy amount – US$20 trillion or more – back into the economy to "restimulate" it. This has merely had the perverse effect of propping up the very parts of the US economy (and the West's) that most need deflating: the military and intel-industrial complex, automobile companies, green energy, etc.
As we've pointed out, it is even hard to tell what a real Western economy would look like because there has been so much money stimulation for so long. All sorts of extraneous businesses of great size have been built up. And the gigantism that has taken place as a result of fiat money has been buttressed by the West's legal system that has created an entire fictitious class of economic actors called corporations.
The combination of corporate empowerment and vast, endless monetary stimulation has virtually created an entirely inefficient – and even useless – top-down economy. What likely would be an economy of partnerships and entrepreneurial shops; and various kinds of interlinked family businesses including family farms has been replaced by inefficient and unsustainable industrial bloat.
The current economic policies of recessionary West remain unsustainable because they have been created within the current failed paradigm. Vast nationalized companies run on alternative energy that costs two or three times as much as traditional power sources. Equally vast quasi-statist enterprises plow hundreds of millions into producing "low carbon" efficiencies that are as ephemeral as they are wasteful. All of this is the result of the West's impossibly distorted monetary system and equally perverse legal system. No wonder employment isn't recovering.
Recently we noted a sign that some of this was beginning to reverse – as it should given the length and depth of the West's recession. According to a recent article in the LA Times, the US Bureau of Labor Statistics (desperate to find a silver lining amidst recessionary lead) added "incorporated self-employed workers" into the mix.
Presumably this new category merely rejiggered previous numbers, but nonetheless it begins to show a trend emerging in our view. According to the Times, the new numbers reveal that 14 million Americans are self-employed, up from the 9 million derived via previous data analysis. The Times explains that many workers find themselves "making their own jobs once they become frustrated with employers' reticence to hire."
The newspaper quotes Sara Horowitz, founder and executive director of the Freelancers Union, as saying she hopes the new numbers draw attention to the situation that many Americans are in today. "People are not just waiting for companies to hire them, they are getting out on their own, starting their own work."
Ms. Horowitz also points out that such individuals do not receive corporate benefits such as health care but that nonetheless their number is growing. Contract workers and freelancers form a kind of flexible, working network that we have often predicted the economy in the West – and especially in the US – would revert back to as the swollen fiat economy gradually subsided.
Of course it has a long way to go and Horowitz herself (along with the Times) doesn't understand the implications. She worries aloud in the article that the independent agents she represents are doing without corporate perks such as health care. Horowitz will no doubt begin to lobby government for such "protections." In fact, she will be campaigning for exactly the wrong solutions. What she and others should be agitating for is a private-market health care system and generally for deconstructing the legal and regulatory environment that has facilitated serial Western industrial catastrophes.
We don't expect a reversion anytime soon to a rational economic and political system in the West. The power elite that has organized the current central banking economy and profits from it, uses its intricate, predictable ruin to drain first one continental economy and then another of productivity and wealth. Each regional economy in turn is stimulated anew – its industrial capacity revved hotter and hotter – until the inevitable collapse comes.
In this way, bankers maintain the fiction that the current Western system "reduces poverty." In fact it does no such thing. It is like giving prescribing pituitary growth stimulants that produce a giant's frame and a child's mentality. The larger the poor creature grows, the weaker and more malformed it becomes. Eventually it collapses altogether, paralyzed.
The entire West has been paralyzed by this kind of economic gambit – just as Argentina and the Asian Tigers were paralyzed in the past. China will come next, its titanic economy imploding as the ravages of fiat money eventually take their toll. Of course, those invested in the current Western banking system will claim credit for lifting the Chinese out of poverty – and like locusts they will head to Africa, which is next in line for the "business." We're not sure the locusts will get that far however.
Too many people are starting to understand the grandiose and meretricious manipulation that has been created in the name of the modern Western economy. The Internet in particular is helping to show people other, less exploitative ways of creating economic progress (via real free markets and honest money). In fact, the current system carries within it the seeds of its own destruction. It destroys too much and leaves behind too much human wreckage. People grow increasingly angry and their anger is directed nowadays not at "bankers" or "tycoons" but at the system itself.
This is what the power elite fears above all, but in our view it is too late to stop the increased knowledge of what is going on along with a realization of the correct targets. Eventually, Western economies will begin to stabilize, and when they do a new era may emerge, one based on the Invisible Hand rather than the merciless grip of the Anglosphere.
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