Evidently, the actual numbers for unemployment are far worse than the Obama administration had predicted; more or less, far worse then "scary" prediction for "what happens if we don't stimulate the economy." In similar news, it's found that all the attempts to "stimulate" borrowing (by borrowing trillions out of private hands) are actually making the problem worse by pushing interest rates up.
Since apparently economics isn't taught at the schools Obama attended (that's why Galbraith taught at one of them, of course), I'll be glad to help people understand what's going on. When you increase the demand for money by running a $1,800,000,000,000 deficit (zeroes included for the benefit of those who skipped math class as well as econ during college), the market clearing price (interest rate) for borrowing goes up.
In the same way, when you take money from people who know how to make jobs for $100, 000 a position and give it to those (government types) who require $1,000,000 per position to create a job, the end result is that you will eliminate about 9 jobs for every million dollars spent.
Not coincidentally, about half a million people are losing their jobs every month. It's not rocket science, though it apparently is beyond the abilities of Mssrs. Obama (Blagojevich/Capone) and Geithner.
Clearing The Decks: 4/19 Edition
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In one sense, this blog hasn’t changed much in the 22 years I’ve been
running it. I get up early, I write stuff. For the past 20 years, it’s
doubled as sho...
4 hours ago
2 comments:
"President Barack Obama announced Monday that he is ramping up stimulus spending exponentially in the next three months, allowing the administration to “save or create” 600,000 jobs — four times as many as during the first 100 days since he signed the bill." [POLITICO]
Hmmm, lemme see: 600,000 / 4 = 150,000. So, according to Obama, he has "saved or created" 150,000 jobs in his first 100 days in office which is about 46,000 per month. BUT, the numbers don't lie, according Bureau of Labor Statistics in May 787,000 jobs were purged from the rolls. I guess, according to Obama and his figures, the actual numbers for may would have been 833,000.
Put more simply, it appears that the models don't work, just as Mises predicted in Human Action.
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