The Real Unemployment Number

Author:
Publish date:
Updated on

Good morning. Officially the February jobs number declined by 63,000. But the expansion of government jobs conceals the real damage our economy has suffered. Net out the government jobs and you have private sector employment contracting by around 101,000 jobs. Making matters even worse, average hourly wages have gone up 5 cents, fueling fears of price inflation. (The 5 cent number is actually quite typical for February and only looks high because employment fell so drastically.)
The Federal reserve announced that it would expand the Term Auction Facility, promising to keep running the auctions for six months. This is disappointing a lot of people who bought into the rumor of an emergency rate cut. And it may imply that the Fed, which took the action after it had already seen the horrible jobs numbers, feels that its hands are tied on interest rates by the threat of inflation.
Oh, and in other news Carlyle's troubled fund was levered up 32 times, and its lenders are liquidating some of its securities. Ambac sold its shares last night at a 9% discount to the closing price.

Related