Are We Really Out of the Recession? on the Ilyce Glink Show August 7, 2011:
Welcome to the worst week of financial news since 2009. Let’s dive right in shall we? Among the week’s highlights that callers dial-in to discuss with me:
- It was the worst week for the stock market since the financial crisis began.
- With the S&P downgrade of the U.S. credit rating from AAA status, it may be the worst week ever for the nation’s government. The White House accused the credit agency of using the wrong map and S&P leveled the threat of another downgrade if Washington doesn’t get its act together.
- The nation’s unemployment rate fell to 9.1 percent from 9.2 percent the previous month, which sounds great until you realize that the decrease stems almost solely from an additional 200,000 people leaving the workforce. In fact the workforce participation rate currently sits at its lowest level since the 1980s. Barely half of the people who could be working actually are. To put it in perspective, just to get back to an 8 percent unemployment rate, we’d need to add 13.9 million jobs, but we can’t presently string together a couple of months of consistent 100,000 jobs growth.
- Government-controlled mortgage giant Fannie Mae’s losses are widening.
A fair number of news organizations are ready to declare that we’re facing a double dip recession. My question to my listeners is: did we ever get out of the Great Recession in the first place? Because this certainly isn’t behaving like any recession and recovery that I have ever seen. Where was the job creation the first two years after we struggled to emerge? Why aren’t the banks writing down loans?
This shaky recovery doesn’t just make for a lousy present. It poses a serious threat to our future as well, especially for the nation’s children. Consider The State of America’s Children 2011 Report, compiled by the Children’s Defense Fund. Among the report’s more alarming statistics:
- There are 4 million more children living in poverty today than in 2000.
- The number of children who fell into poverty between 2008 and 2009 was the largest increase ever recorded.
- The number of public school kids classified as homeless shot up 41 percent between the 2006/2007 and 2008/2009 school years.
There is plenty more to say on this week’s show, but the question for my callers bears repeating: are we really out of the recession?