Economy Sheds 598,000 Jobs in January

Bad, bad news:

WASHINGTON — The United States lost almost 600,000 jobs last month and the unemployment rate rose to 7.6 percent, its highest level in more than 16 years, the Labor Department said Friday.

It was the biggest monthly job loss since the economy tipped into a recession more than a year ago, and it was even worse than most forecasters had been predicting.

In addition, the government revised down its estimates for previous months by 400,000. For December, the government revised the job loss to 577,000 compared with an initial reading of 524,000. Overall, it said, the nation has lost 3.6 million jobs since it slipped into a recession in December 2007.

“Businesses are panicked and fighting for survival and slashing their payrolls,” said Mark Zandi, chief economist at Moody’s Economy.com. “I think we’re trapped in a very adverse, self-reinforcing cycle. The downturn is intensifying, and likely to intensify further unless policy makers respond aggressively.”

Wow. This feels like another depression, doesn't it?

Auto Bailout Talks Collapse as Senate Deadlocks Over Wages

Well it looks like Mitch McConnell and his boys are going to get there way:

An eleventh-hour effort to salvage a proposed $14 billion rescue plan for the auto industry collapsed late last night as Republicans and Democrats failed to agree on the timing of deep wage cuts for union workers, killing the legislative plan and threatening America's carmakers with bankruptcy.

"We're not going to get to the finish line. That's just the way it is. There's too much difference between the two sides," Senate Majority Leader Harry M. Reid (D-Nev.) announced after 10 p.m., concluding a marathon negotiating session that ended in gridlock. Reid warned that financial markets could plummet when trading opens this morning.

"I dread looking at Wall Street tomorrow. It's not going to be a pleasant sight," he said.

As I've said before, I think we need to bailout the Big 3 for the simple reason that there are millions of jobs of everyday middle class people on the line.

However, while some partisans might be cursing the minority party, I can understand why reservations about an auto bailout. Why give away billions of dollars to companies on the verge of the collapse because of incompetence and stupidity? Of course, in almost any other time, I think you do let the big 3 fail. Our economy would survive, and American manufacturing would evolve and change, just like businesses always evolves and changes into something else.

But you cannot let it happen during the worst economic crisis since the Great Depression. Maybe the government is just staving off the inevitable, and the car companies will collapse eventually. So be it. But I don't want to have a Herbert Hoover-style of dealing with financial crisises and sit back and do nothing.

Paul Krugman is scared out of his mind, which means I am too

I saw this Paul Krugman's blog the other day:

Two points:

1. The economy is falling fast. We’ll see what tomorrow’s employment report says, but we could well be losing jobs at a rate of 450,000 or 500,000 a month.

2. Infrastructure spending will take time to get going — a new Goldman Sachs report suggests that projects that are “shovel-ready” are probably only a few tens of billions worth, and that a larger effort would take much of a year to get going. Meanwhile, it’s very questionable how much effect tax rebates will have on consumer demand. So it may be hard for stimulus to get much traction until late 2009 — and that’s even if Congress goes along, which may be a problem given all the bad analysis and disinformation out there.

So here’s what I’m wondering: will it, in fact, even be possible to pull the economy out of its nosedive before unemployment goes into double digits? I’m starting to wonder.

Ugh... Double-digit unemployment? The last time the unemployment rate was in double digits was 1940 at the end of the Great Depression. As the days pass move on, and the economic numbers look worse and worse, the likelihood of a depression becomes more likely.

Oh Fuck... Jobless Rate Soars to 6.7% in November

Well we knew the economy was bad. Stock prices are dropping. Big banks are going under. But I'm not sure anyone knew it was this bad:

With the economy deteriorating rapidly, the nation’s employers shed 533,000 jobs in November, the 11th consecutive monthly decline, the government reported Friday morning, and the unemployment rate rose to 6.7 percent.

The decline, the largest one-month loss since December 1974, was fresh evidence that the economic contraction accelerated in November, promising to make the current recession, already 12 months old, the longest since the Great Depression. The previous record was 16 months, in the severe recessions of the mid-1970s and early 1980s.

All I can say is holy motherfucking shit. This is already the longest recession since the Great Depression. And things are not getting better anytime soon... expect things to get worse.