The real US unemployment rate is not 9.8% but between 25% and 30%. That is a depression level of job losses – so why doesn’t it look like a depression for many people? How can so large of a statistical discrepancy exist, and how is it that holiday shopping malls are so crowded in a depression?
The true devastation is hidden by essentially placing the job losses inside three different “boxes”: the official unemployment box, the true full unemployment box, and most importantly, the staggering and persistent private sector job loss box that has been temporarily covered over by a fantastic level of governmental deficit spending. The “recovering and out of the recession” cover story is only plausible when nobody connects the dots and adds all the boxes together.
We will add together the three boxes herein – using US government statistics for all three – and convincingly show that the US economy is in far worse condition than what is presented by the government or by the mainstream media. No, we have not emerged from “recession” and there will be no “double dip” – because the first “dip” was straight down to a depression-level economy in 2008/2009, and we haven’t come back up.
Creating artificial “free money” on a massive scale that artificially boosts short-term employment is how you segment depression level unemployment into the separate boxes and hide what is really happening. It is this radical strategy that most distinguishes the current downturn from the 1970s and 1930s. The ultimate source of most of the current “free money” that hides the depression is the government risking the impoverishment of US savers and investors for potentially decades to come, with the worst of the damage concentrated on retirees and Boomers.
To have a chance of defending your hoped-for future lifestyle, there is simply no substitute for seeing the truth clearly. For it is only when we see through the lies with clarity that we can distinguish the false opportunity of manipulated markets from the real opportunities that can be found in unexpected places.
Headline Unemployment (Box 1)
The graph above is our starting point and first “box”. It is the “headline” rate of unemployment in the US that is featured in newspaper articles and discussed on the cable business news. As of November 2010 the official US unemployment rate was 9.8%. While that’s deeply painful, and unemployment rates since 2008 have been the highest seen since the end of the Great Depression (with the exception of the 10.8% peak in 1982), 9.8% is not a depression level unemployment rate.
Real Unemployment (Box 2)
As economists and political decision makers know quite well, the “official” unemployment rate is not the full rate of US unemployment. The “official” rate is technically known as the U3 rate of unemployment, and it is a politically advantageous partial accounting for the unemployed. The U.S. Bureau of Labor Statistics calculates unemployment 6 different ways, U1-U6, and it is only in the U6 statistic that all the categories of unemployment are added together.
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via Hiding A Depression: How The US Government Does It | FINANCIAL SENSE