International Forecaster Weekly

Fearing The Bottom Will Fall Out If Interest Rates Rise

Broke Americans raiding their 401 Ks, Biden delivers report on middle class in America, the threat of rising interest rates, a contaigon of bankruptcy, big changes in commodities recently, a planned default for all nations, rigged markets, an unsuccessful relationship with Pakistan, gas prices to bring hardships.

Bob Chapman | May 21, 2011

The amount of money and people withdrawing from 401K’s has been staggering and Wall Street and government do not like it one bit. There are those who have been fired, run out of benefits, and half to cash in part or all of their retirement. The villainous ones are those still employed, who have taken up to three loans, many of whom have bought gold and silver with the proceeds.

That said, Senator Herb Kohl, Senator Mike Enzi have introduced legislation to limit citizens to tapping into their 401K’s, called “SEAL 401K Savings Accounts.” The bill would reduce and limit the number of loans workers may take from 401K’s and give participants more time to pay back loans after losing their jobs. In addition, employers would have the option to reduce the number of loans for their plans.

At the end of 2010, 28% of participants had loans outstanding, a record. The average loan balance was $7,860.00 and 58% of plans permit participants to have two or more loans at a time. If participants are fired or lose their jobs 70% default on their loans.

Workers generally may borrow as much as 50% of their vested account balance up to $50,000. The loan must be repaid in five years, unless the money was used to purchase a primary residence. The average interest rate is 1% over prime.

We find it of more than passing interest that Mr. Kohl is not running for reelection next year.

If you are going to borrow from your 401K’s do it now, ahead of this legislation, that could interfere with the purchase of gold and silver shares, coins and bullion. This is the main reason for this legislation, to stop you from protecting your assets. Of course, such loans involve selling holdings in the 401K’s and that puts downward pressure on stock and bond markets, or takes incoming funds destined for those markets away from those markets.

One aspect of a new and improved federal regulatory scheme is the seizure of 401(k) retirement plans and the subsequent government-administered disbursement of the funds.

In Chapter 3 of the Annual Report on the Middle Class released in February by Vice President Biden and the White House Task Force on the Middle Class, the Obama administration calls for enhancing the “retirement options” for the middle class by imposing “new regulations to improve the transparency and adequacy of 401(k) retirement savings.”  [Read the entire article: [Here is your proof, as we have been telling you over and over again, get out of your 401Ks and IRAs before you have nothing more than a promise to pay from a bankrupt government. Bob]

It is difficult for observes to get the perception that very dangerous financial and economic events are just around the corner. We find up to a certain point those in power more often are able to pull another rabbit out of the hat. Not that the problems have been solved. They haven’t been solved. All of the assistance, as temporary as it may be, has gone to the world financial community and governments. We seldom hear the question why did these financial experts and governments get into such a horrible state of affairs? All we hear of is saving them and allowing them to keep two sets of books, so they can write off their losses over the next 50 years. We don’t expect you to get such a comforting arrangement. These are the same lenders that if you are late on a payment your interest rate goes from 6% to 30%. To say the least the lenders and governments are getting away with financial mayhem. We find it of great interest that the Federal Reserve and the European Central Bank find it appropriate to buy bonds known as toxic waste, those are bonds containing mortgages, and find it necessary to keep secret what they are paying lenders for these bonds syndicated several years ago. Then previously there was the matter of divulging who the Fed loaned money to during the credit crisis. It took two years to get that issue adjudicated at the appeals level. The Fed wouldn’t divulge because they said what they had done was a state secret, a position totally untenable; which the court disagreed with. The Fed just didn’t want anyone to know who they were bailing out. They were bailing out select elitist corporations not only in the US, but in foreign countries as well.

Anyone with a drop of sense knows that if official interest rates rise, or if continuing debt expansion is halted, the bottom will fall out of the US economy and the world economy with varying damage. Still about 60% of foreign reserves are held in US dollars, the world’s reserve currency. Since 1988 central banks generally speaking have been sellers of gold at the behest of the US government and the Federal Reserve in order to suppress prices and rid the world financial system of gold backing. Gold acts as a control mechanism limiting a country’s ability to create money and credit. Under neo-fascist Keynesianism the creation of money, credit and speculation was to be allowed to run rampant, as we have seen for some years. All of the profits went to the transnational conglomerates, as the losses were dumped on the public. We would call that a one-way street. The debt created from a recent historical perspective is without precedent and continues to grow in the US and in Europe. Over the next two years it is estimated that $3.6 trillion has to be rolled over plus new debt.

We see Greece, Ireland and Portugal essentially bankrupt and ready to enter the fray is Spain, Belgium and Italy. Contagion is already with us to the tune of $4 trillion, a sum Germany, France, the Netherlands, Austria and Finland cannot finance without bankrupting themselves. We wonder who is going to buy such debt? Probable lenders such as China only have a limited interest, because as it cuts back on US Treasury paper it buys gold, silver and commodities. Why shouldn’t they when the drums of war are in the distance? Besides, China has inflation of 10% to 15% and has seen home prices in Beijing fall almost 40% recently. That probably will spread countrywide. As in America, Spain, Ireland and England that means mortgage defaults and bank losses. That will lead to recessionary conditions and a drop in imports, which will negatively affect sellers to China such as Japan. We can assure you that a slowdown in China will affect the entire world. That means China probably will not be a buyer of foreign bonds in the numbers they have been in the past. The US TIC Report already bears this out and thus; Spain will probably not get the money it is looking for from China.

In the US the Fed probably will buy $1.6 trillion in Treasury and Agency debt over the next year, although we see the Treasury currently tapping government pension retirement funds to fund the lack of US debt extension and that license could be used to relieve the Fed of some of the burden. Needless to say, that is not a permanent solution. If that tactic is employed private pensions, as we have warned for the past two years, could become a victim of the government as well. At the same time the world economy is again slowing and that does not bode well for borrowers either. In spite of US government manipulation of markets everything they do is only temporary. The markets are far too vast for them to have any lasting effect. Just look at the last 11 years, gold has gone from $260.00 to almost $1,600 and silver from $3.80 to $49.50. As well over the past 11 years nine major currencies on average per year have fallen more than 20% in terms of gold and silver. That means you do not hold or invest in currencies. As an alterative, historically gold and silver have been the safest place to be.

Those in power behind the scenes believe they can create recovery by simply following the Keynesian model, which is print money and credit forever. Their policies are not working in the public sector. We see higher sales figures, but they are the result of inflation. Debt saturation and its continuation won’t solve the problem; only purging the system can solve the problem. The bankrupt have to be allowed to fail. Too big to fail has to come to an end. The world financial system has to be purged and the only way to do that is to call an international meeting and revalue and devalue all currencies against one another and have a multilateral default on unpayable debt. Then nations can decide what the new world reserve currency will be and whether it will be gold backed.

The foreclosure problems in the US and Spain are beyond believability. In the US monthly inventory for sale is normally 4 to 5 months, presently it is 3-1/4 years and should be four plus years by the end of the year. In Spain the visible inventory is 50,000 homes, but in reality it is much higher than that. Worse yet, the banks are lying about it just as they are in the US. Even at 30-year fixed mortgage rates of 4.61% people do not quality to buy. Home prices will fall at least 10% by yearend and more next year and into 2013. Then they will bump along the bottom for years. In the US lending has dried up and it is more difficult to get loans than it has been. Housing debt is unbelievable and is unpayable. There is no recovery in sight in spite of spending of more than $2 trillion on QE2 and stimulus 2. We can assure you QE3 or something like that is on the way, otherwise it is collapse. The Fed has to come up with $1.3 trillion to purchase Treasuries and Agency securities, June to June just to stay even. Our guess is that figure in reality will be $2.1 to $2.5 trillion, as the dollar reaches new lows. The flipside is in spite of government manipulation, gold, silver and commodities will move much higher in the flight to quality and safety. There is absolutely no reason to believe that debt will be repaid nor will there be any recovery. Every single day people all over the world are losing purchasing power due to inflation and the profligate policies of their governments. There has to be a well planned or orchestrated plan for default by all nations collectively. This is why your investible funds have to be in gold and silver coins, bullion and shares. That is the only place investment funds are safe. Just look at the last 11 years during which gold and silver rose by more than 20% on average versus nine major currencies annually. Is that not enough proof to convince you where your funds should be? Quantitative easing has to continue and so does the upward valuation of gold and silver coins, bullion and shares.

Food and oil demand continues to increase as the third world experiences more prosperity and growing populations. That is one of the results of free trade; globalization, offshoring and outsourcing hadn’t planned on. Having created these conditions they now talk of reducing world population, a condition they call a surplus of useless eaters. As a result banks and hedge funds are again leveraged as they were in 2008. Fortunately most are presently short gold and silver related assets.

Once it becomes visible through the veil of government propaganda that conditions are deteriorating real interest rates will rise sending bonds down and the stock market will follow. What else can they do with no recovery, a falling dollar, 22.2% real unemployment, 10% inflation, a minus GDP and exponential creation by the Fed and the Treasury of money and credit. As the printing presses roll on we see shortages in physical gold and silver, which soon lead to higher cash prices. As we have predicted correctly for 11 years, no matter what the Illuminists do they cannot arrest the flight to quality in gold and silver.

The past few weeks have seen some staggering events in the commodities, gold and silver market. As you all know JPMorgan Chase and HSBC have been naked short both gold and silver, but particularly silver. In the case of silver, the CFTC, the Commodity Futures Trading Corp., has seen fit to allow Morgan and HSBC to continue to corner the silver market. We saw JPM and HSBC essentially stand by in the futures market, as silver climbed higher. In the futures market they do not seem to have altered their positions to any great degree, so they have to be doing their trading in the opaque, unregulated derivatives market. Then there have been the unprecedented actions by the CME/Comex, which raised margin requirement five times in nine days. They were elevated from $4,500 to $9,500 – previously and then the following five changes moved margins from $9,500 to $21,600. Even more importantly major commodity brokerages doubled those margin requirements from $21,600 to $42,000. As a result most speculators in the small and medium categories were wiped out. This was unprecedented as well. We, of course, ask why all these brokerages decided to simultaneously double core rates? We don’t believe in coincidences, thus could it be they and the CME were propelled to do what they did by some powerful outside force, such as our government? We cannot prove that, but the actions of these players are very suspect.

We know that presently the CFTC, SEC, NYSE and Nasdaq are receiving 3,000 complaints a day up from 1,000 a week ago, claiming the gold and silver markets are rigged and naked shorts are allowed to control these markets.

Here is a response by the SEC and answer by a subscriber to the SEC.

“Thank you for contacting the SEC. Before we are able to respond to your email, we need more information from you: including your supporting documentation that JPMorgan is making illegal naked short sells and its manipulating the gold and silver markets.

Here is the subscribers answer: It is my feeling because of the large naked short position that JPM and HSBC are allowed by the CFTC to carry, that they were in part responsible for the action of the CME/Comex and the simultaneous conclusion by a number of major commodity houses to double the CME margin requirements to their clients. It is not my place to provide supporting documentation. That is your job. Why do you think I am writing to you? Investigate and come up with some answers. Do not defer them to me. Are you not supposed to be protecting me as a regulator? I await your answer.”

This shows you the high handed brazen arrogance of our regulators. They know exactly what is going on with naked shorting and won’t do anything to stop it.

JPM is a major shareholder in the privately owned Federal Reserve, which is no more federal than Federal Express. For years they have been allowed to run roughshod over the markets making fortunes in the process. Back in 2005 we recommended a long position in natural gas at $3.80. The market ran up and we recommended sale at $14.50. At $15.00 JPM was allowed to deal in natural gas, which promptly fell to $4.50 after they participated. A very strange coincidence, which in that process wiped out a major commodity player. We believe JPM rigged the market, but we cannot prove it, because we cannot access their records and the CFTC had no desire to do so. This is the same kind of treatment we are receiving in the silver market today. You should all be writing to every representative and senator in Washington, the CFTC, SEC, NYSE, ASE, and Nasdaq and registering your complaints because the squeaking wheel gets the grease. Even if they do nothing they will all be aware that millions of investors know what they have been up too. Do not forget this is nothing new and the regulators know that. Morgan, HSBC, Barclays, Goldman Sachs and Citicorp among others run the markets exactly as they please with little or no interference, because they control the US economy and your lives.

The markets are all rigged and it is up to you to let the above entities mentioned above know, that you know what they are doing and you want it stopped now.

Hawaii saw a total of 2,476 initial unemployment claims for the week of May 14, up 12.5 percent compared to the 2,201 claims filed during the same week in 2010, according to data from the Hawaii Department of Business, Economic Development and Tourism.

GOP 2012 hopeful Rep. Ron Paul (R-TX) thinks U.S. troops will soon be on the ground for an occupation of Pakistan — and he said so on MSNBC's "Morning Joe" Wednesday morning.

Paul called America's relationship with Pakistan "an impossible situation," where the U.S. hailed both its friendship with and suspicion of the country.

"I think we are going to be in Pakistan, I think that's going to be our next occupation, and I fear it," Paul said. "It's ridiculous. I think our foreign policy is such we don't need to be doing this."

Paul said he had no inside information on Congress authorizing or ordering troops to invade Pakistan. He simply said based on U.S. history, he wouldn't be surprised to see further U.S. involvement there.

"Right now, Pakistan is a big problem," he said. "We have created a civil war there, and the fact that we go over there and we violate their security and the people rebel against the government because they see their government as being a puppet of the American government, so it's total chaos and I'm afraid, and I hope I'm absolutely wrong, but I'm afraid we'll be in Pakistan trying to occupy that country, and it will probably be very unsuccessful."

Fewer people bought previously occupied homes in April, a troubling sign that the weak housing market remains a drag on the economy.

Sales fell 0.8 percent in April to a seasonally adjusted annual rate of 5.05 million units, the National Association of Realtors said yesterday. That’s far below the 6 million homes a year that economists say represents a healthy market.

Purchases made by first-time home buyers did increase but not nearly enough to signal a housing recovery is on the way. First-time buyers are critical because they typically improve their properties and invest in their communities, a combination that helps home values rise.

Foreclosures, on the other hand, force prices down. They represented more than a third of all sales in April and more are expected in the months ahead.

Since the housing boom went bust, sales have fallen in four of the past five years and hit a 13-year low last year. Declining home prices and low mortgage rates haven’t been enough to boost sales this year.

Some who want to buy can’t, mostly because banks have tightened lending requirements and are insisting on larger down payments. Many buyers who can qualify for loans are holding off.

Economists say it could be years before the housing market fully recovers.

A growing problem is that some sales that are under contract are falling apart. A separate survey from the trade group found 11 percent of realtors said a contract was canceled because an appraisal came in below the negotiated price. And 14 percent said a contract was renegotiated to a lower price because of a low appraisal.

The median sales price in April was $163,700. That’s down 5 percent from the same month one year ago. The median price of a new home is now nearly 31 percent higher than the median price for a previously occupied home — or twice the normal markup.

The gap is largely because of the flood of foreclosures or short sales — when the lender accepts less than what is owed on the mortgage. Those sales are forcing down prices.

Sales of homes at risk of foreclosure fell in April. But they still made up 37 percent of all purchases.

With gasoline prices hovering at $4 a gallon nationally, many Americans are making tough choices: scaling back summer vacations, driving less or ditching the car altogether. And high prices are hitting seniors harder than a month ago.

An Associated Press-GfK poll shows the share of Americans who say increases in the price of gasoline will cause serious financial hardship for them or their family in the next six months now tops 4 in 10.

Overall in the poll, 71 percent said rising prices will cause some hardship for them and their family, including 41 percent who called it a "serious" hardship. Just 29 percent said rising prices are not causing a negative impact on their finances.

By income, 63 percent of those with annual household incomes over $50,000 now say rising prices are causing them financial hardship, up from 55 percent in March. Those with lower incomes already were more likely to feel strained in March, and more than three-fourths of them continue to report financial hardship.

For older Americans, it's worse.

The share of seniors expressing financial hardship over gas prices hit 76 percent; it was 68 percent in March.

Nettie Cash, 65, of Dallas, Ga., is cutting back on her medicine because of the cost of fueling up her Buick. Cash is still taking her heart pills but is forgoing her inhaler and ulcer medicine for now.

"It's not easy," she said. "You have to do what you have to do."

The public's coping strategies are largely unchanged from March, with 72 percent having cut back on other expenses, 66 percent saying they've reduced the amount of driving they do and 48 percent changing vacation plans.

Since January, gas prices have shot up about 90 cents, with the national average for a gallon of regular this week at $3.96.

Financial analyst Nicole Polite in Baltimore sold her Nissan Altima recently and is taking public transportation, opting for the bus, rails and walking to get to work. Gas prices were just too high, she says, so she and her boyfriend downsized to a one-car household. She says they kept their Lexus sedan, which requires pricey premium gas.

"It's definitely a financial strain because now you have to reassess everything," said Polite, 32. "We don't go out as much. That $20 that we could have used to go to a movie — now that money has been absorbed by the gas tank."

But analysts say relief is coming. Fred Rozell, retail pricing director at the Oil Price Information Service, expects the price at the pump to drop as much as 40 cents in the next four weeks.

Until that happens, Ross Cobb in Boerne, Texas, will still try to keep his highway miles down. Cobb says he and his wife have been driving less and curbing trips into the city for their children's clothing and other supplies.

"We coordinate all of our trips into San Antonio," said Cobb, an associate athletic director at the University of Texas. "We don't ever go in anymore just for one particular errand. We wait until we've got two or three things to do."

The Associated Press-GfK Poll was conducted May 5-9 by GfK Roper Public Affairs and Corporate Communications. It involved landline and cellphone interviews with 1,001 adults nationwide and has a margin of sampling error of plus or minus 4.2 percentage points.


IMF chief Dominique Strauss-Kahn was placed under a suicide watch in jail, while pressure mounted on him to resign yesterday and the hotel maid who accused him of attempted rape said through her lawyer that she had no idea who he was when she reported the attack to police.

Law enforcement officials emphasized that Strauss-Kahn had not tried to harm himself but that guards were keeping a close watch on him just in case.

Meanwhile, details began to emerge about his accuser, a 32-year-old immigrant from the West African nation of Guinea with a 15-year-old daughter.

Her story of being attacked by Strauss-Kahn in the Sofitel hotel suite near Times Square is consistent because she is telling the truth, her lawyer Jeffrey Shapiro said.

Maneuvering begins for Strauss-Kahn’s IMF post. B8

“There is no way in which there is any aspect of this event which could be construed consensual in any manner,’’ Shapiro said. “This is nothing other than a physical, sexual assault by this man on this young woman.’’

He continued: “It’s not just my opinion that this woman is honest. The New York City Police Department reached the same conclusion.’’ He added, “This is a woman with no agenda.’’

After being denied bail on Monday, Strauss-Kahn, 62, is jailed at Rikers Island on charges including attempted rape.

Defense lawyer Benjamin Brafman has said he and others assisting Strauss-Kahn in the case believe the forensic evidence “will not be consistent with a forcible encounter.’’

He said that “significant issues’’ make it “quite likely that he will be ultimately be exonerated.’’

The maid has not been identified by name, and the Associated Press generally does not name people alleging sexual assault.

She arrived seven years ago in the United States from Guinea under “very difficult circumstances,’’ Shapiro said, and lives in the city with her daughter.

Shapiro said the woman did not know that Strauss-Kahn was managing director of the International Monetary Fund.

“She did not know who this man was until a day or two after this took place,’’ Shapiro said. [If you believe this story, we have a bridge for sale that connects Manhattan to Brooklyn. Bob]


April Industrial Production Stalled As Prior Months Were Revised Lower. This morning’s (May17th) Federal Reserve Board release of seasonally-adjusted April 2011 industrial production showed aggregate production to be unchanged (down 0.5% net of prior-period revisions) versus March, with manufacturing tumbling by 0.4% in April. In turn the aggregate March index was revised to a 0.7% (previously 0.8%) monthly gain. The revisions the April report all were post-benchmark revisions, with the largest change showing the previously reported 0.1% monthly gain in February 2011 now being a 0.3% contraction.

Year-to-year change in April 2011 production was 5.0%, down from a revised 5.3% (previously 5.9%) gain in March. The year-to-year contraction of 14.9% seen in June 2009 was the steepest annual decline in production growth since the shutdown of war-time production following World War II.


The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, climbed 7.8 percent in the week ended May 13.

The MBA's seasonally adjusted index of refinancing applications surged 13.2 percent, while the gauge of loan requests for home purchases dipped 3.2 percent.

Both the overall index and the refinance index reached their highest levels since early December.

The refinance share of mortgage activity rose to 66.7 percent of total applications, the largest amount since late January.

"The 30-year fixed mortgage rate is now 53 basis points below its 2011 peak, and has decreased for five straight weeks," Michael Fratantoni, MBA's vice president of research, said in a statement. "Over this five week span, the refinance index has increased by about 33 percent."

Fixed 30-year mortgage rates averaged 4.60 percent in the week, easing from 4.67 percent the week before. It was the lowest rate seen in the survey since late November 2010.


Barack Obama to back Middle East democracy with billions in aid President pledges cash to support Egypt and Tunisia after criticism US has been too slow to support uprisings Barack Obama is to announce that the United States and the west will pour billions of dollars into the Middle East in support of Egypt, Tunisia and other countries embracing democracy, a move the White House portrayed as being on the scale of aid to former communist countries after the fall of the Berlin Wall…The US is to relieve Egypt of up to $1bn in debt and lend or guarantee up to $1bn. The World Bank, the IMF and other multilateral institutions to provide a further $2bn-3bn.

The official described Tunisia and Egypt as beacons, models to encourage others to pursue democracy.

A poll published on Tuesday by the Washington-based Pew organisation found that President Obama remains unpopular among countries polled in the Middle East and elsewhere in the Muslim world, except Indonesia.


Whitney Meredith: The Hidden State Financial Crisis, The latest research into opaque state financial statements suggests taxpayers will be surprised by how much pensions are underfunded.

Next month will be pivotal for most states, as it marks the fiscal year end and is when balanced budgets are due. The states have racked up over $1.8 trillion in taxpayer-supported obligations in large part by underfunding their pension and other post-employment benefits. Yet over the past three years, there still has been a cumulative excess of $400 billion in state budget shortfalls. States have already been forced to raise taxes and cut programs to bridge those gaps.

Next month will also mark the end of the American Recovery and Reinvestment Act's $480 billion in federal stimulus, which has subsidized states through the economic downturn. States have grown more dependent on federal subsidies, relying on them for almost 30% of their budgets.

The condition of state finances threatens the economic recovery.

States employ over 19 million Americans, or 15% of the U.S. work force, and state spending accounts for 12% of U.S. gross domestic product. The process of reining in state finances will be painful for us all.

Today, off balance sheet debt totals over $1.3 trillion, as measured by current accounting standards, and it accounts for almost 75% of taxpayer-supported state debt obligations.


Firms Fill Up on Debt Before Fed Closes Door on Easy Credit All told, investment-grade companies sold $19 billion of bonds in the U.S. in the past two days, according to data provider Dealogic, setting the week up to be among the busiest so far this year. Bond sales in May have reached $56.7 billion with two weeks left to go in the month almost as much as the $59.6 billion sold in all of April.

Newly hired autoworkers are earning $14 an hour plus benefits, about half of a veteran autoworker’s wage. And many experts and labor leaders worry that the wage premium that factory workers enjoy is eroding.


Wards Automotive has published actual unit production for the month of April 2011. According to the data, the motor vehicle assembly rate plunged by 12% to a 7.847 million annualized rate in April, which compares to an 8.923 million rate in March 2011. In the past, such a sizable drop in the assembly rate has usually translated into a sharp decline in motor vehicle output. We project motor vehicle output to decline by 9% in April, which would be entirely consistent with the drop-off in the assembly rate.

We believe the pronounced weakness in the auto sector in April will drag down industrial production, which is the reason we project industrial production to decline by 0.4% in April after rising by 0.8% in March.





Consumer revenue declined 7% but large corporate sales increased 5%. Margins increased to 23.4% from 20.5%. Dell said is saw strength in the public sector, which is odd at the least and likely to disappear as states and municipalities retrench in coming months.


As for the Fed’s exit strategy: In addition, nearly all participants indicated that the first step toward normalization should be ceasing to reinvest payments of principal on agency securities and simultaneously or soon after, ceasing to reinvest principal payments on Treasury securities. A few members remained uncertain about the benefits of the asset purchase program but, with the program nearly completed, judged that making changes to the program at this time was not appropriate.



U.S. employers can expect an 8.5 percent increase in their medical costs next year due in some part to the healthcare reform law, the consulting firm PwC said in a report Wednesday.

The widely read annual report on cost trends points to three main drivers of healthcare costs, two of which are exacerbated by the new law.

Good thing healthcare costs are underweighted in CPI - 5.35% of CPI but 17% of GDP.


Gallup Finds U.S. Unemployment at 9.2% in Mid-May Underemployment is 19.1% -- essentially the same as a year ago.

[In other words, despite trillions of dollars in government spending and Fed intervention, there was little or no employment benefit for average Americans but increased inflation hammered standards of living.]


Governors and legislatures across the nation are moving to cut the length of time unemployed workers can receive benefits, despite historically high unemployment rates, amid concerns that states may need to boost taxes on employers to shore up unemployment trust funds exhausted by the jobless benefits.

More than 8 million Americans are drawing unemployment, according to the Department of Labor. Benefits levels are set and administered by each state and vary widely.