Why Stock Market is Up With High Nationwide Unemployment Numbers

Photos

Why Stock Market is Up With High Nationwide Unemployment Numbers

see larger image

uploaded by NBernas2009

March 1, 2011 - Two shows gave me insight to why the country is where it is today.  The first was "Hurricane Season" a movie about John Ehret High School (my alma matter) winning the Louisiana State High School Basketball Championship in 2006 after Hurricane Katrina.  The second was "9/11: Science and Conspiracy" a show on the National Geographic Channel that conducted high-tech forensic experiments with in-depth analysis by experts and "truthers" to answer the questions of the events of 9/11/2001.

It was not the story behind the two very different shows that gave me insight to the economy, but rather the idea that came across after watching them.  "Hurricane Season" was about the people in New Orleans after the hurricane had almost washed the city into the Gulf of Mexico.  The movie was filmed in the actual neighborhoods and houses that were flooded by the quick rising flood waters.  It showed the changes that the citizens had to make to continue to live and stay in the devastated parts of the city.  It was hard to relate to the people who have lost so much of their lives (and I lived in New Orleans for 13 years) and to actually believe that the movie was more than just a movie.  I find that people can empathize with those that have suffered in a natural disaster, but over time, if no tragic event occurs to the viewer, the empathic feelings drift away.  One might start to think why don't they just do something to make their own life better, why are they just living in their situation?  Why don't they just pack up and move to a better place?

In "9/11: Science and Conspiracy" the show interviewed intellectual scholars from both sides and their analysis of the many different events recorded that day.  They interviewed those who believe that there is a government cover-up and everything was set up by the government to promote a war economy.  They also interviewed those who looked a the events and said it was planned by those who carried it out.  What I found here is that highly intelligent people can form an opinion based on their own perception.  Many of the "truthers" do not like the idea that people outside of U.S. would harm its' citizens, they would rather believe that the government would put on an elaborate hoax of 9/11 just to push forward a war supported economy.  Is it so hard to believe that the present U.S. Foreign Policy is creating dangerous enemies, while trying to keep our friends friendly to our country?

A combination of these ideas then lead to the reasons why the Stock Market is up when Unemployment Levels are at all time highs.  Today we find that Americans with money still have money and then some.  At the same time we find many working class Americans running out of money and still not working due to cutbacks in hiring.  Many companies are now making profits due to lower payroll costs due to a slowdown in business activity in the last few years.  Companies have reduced the number of workers and now function with less employees.  Those still working are doing the same amount of work that two or three workers did in the past.  Running a company at the same level (or even higher levels) with less people is the way to higher profits.  Those working say that the unemployed are not doing the right things to get hired, they questions the desire and determination of the unemployed.  Those who are employed do not shed a tear for those out of work, because the employed live in a world where little has changed in their personal lives, they work and play as always with the recession having little affect on them.  They have no empathy for Americans who cannot do it all on their own.  The government economists then analyze and produce numbers to show how unemployment numbers are decreasing, never talking about the government number of 13.9 million out of work (with estimates that the actual is up to 31 million people out of work) and only discussing the increase or decrease in the percent of those unemployed.  To think that even after all the newly created jobs have been filled, there are so many millions without jobs, this is where the government is painting a rosy outlook to overcome the facts.

From the U.S. Department of Labor Bureau of Labor Statistics website for January 2011:

"The unemployment rate (9.0 percent) declined by 0.4 percentage point for the second month in a row. (See table A-1.) The number of unemployed persons decreased by about 600,000 in January to 13.9 million, while the labor force was unchanged. (Based on data adjusted for updated population controls. See table C.)

Unemployment Rate: 9.0% in Jan 2011

Payroll Employment: +36,000(p) in Jan 2011

The number of job losers and persons who completed temporary jobs fell from 8.9 to 8.5 million in January. The number of long-term unemployed (those jobless for 27 weeks or more) edged down to 6.2 million and accounted for 43.8 percent of the unemployed"

Perhaps the real number of the unemployed is more like 31 million former U.S. workers still out of work as of January 2011.  At a rate of 36, 000 new jobs each month it will take 71 years to bring down the number of unemployed to normal levels.  I don't think the United States can wait 7 years let alone 71 years for a recovery.

It all comes down to perception.  The rich have money from investments and still enough funds to spend on luxury items, this is whether they work or do not work, they have more than enough money to live their desired lifestyle.  From where they are standing the U.S. is doing fine with no major issues.  Businesses are doing great, making a profit even in a recession along with increasing stock value.  They can acknowledge that millions of working class people are out of work, but believe it is because of the person's own drive and determination that keeps them out of work, it has nothing to do with the job situation.

The unemployed see cloudy dark days ahead with the country falling back into recession.  They perceive the rest of the world as a place full of turmoil and revolution.  Higher gasoline prices, along with increases in the cost of the basic necessities convince them that things are not getting better.  Lose a job and you lose all income, soon they use up all their savings, and with no other monetary funds available they end up losing their homes.  Such that the poor get even poorer.  The unemployed do not understand that a higher stock market does not directly benefit the worker other than providing possible employment, but it directly benefits the owners and investors by paying out dividends.

Who is right?  They all are, as from their own perception of the economic reality, it is either doing fantastic or is in the dumps.  As each individual person sees the economy under their own circumstances, the disparity between the two sides will continue.  The rich will get richer as the poor get even worse.  The stock market is up because the rich have recovered from the recession and still have extra money to invest.  They think everyone is doing well.  The United States has high unemployment because those out of work are still out of work and companies are not hiring.  The unemployed are living on limited funds or receiving some type of assistance and very fearful that everything they worked for will be lost.  The unemployed can't understand why the government is unable to get this country going, not realizing that the are the backbone of economy and that when they don't spend things cannot move forward.  But you cannot spend money when you have no money coming in.

Finally a better understanding of the working class, the middle class, and the rich would be in order.  The working class is you if you work for someone else and do not have ownership in the company profits.  Someone pays you to work for them.  Now do not confuse yourself with the definition the Republicans use for middle class.  They throw this middle class around as if they were talking about you.  The middle class is really someone who has an income of $250,000 or over and has ownership/partnership in a company or corporation.  They decide who gets paid and what workers are paid.  The Republicans always sound like they are talking about you when they talk about tax cuts or extending tax waivers, but they are really talking about the owners, not the workers.  Workers and their incomes do not fall into any of the tax cut waivers that the Republicans want.  They are really just applying tax cuts to themselves and their friends, everyone who owns the businesses, not the regular worker.  The rich have the most and pretty much do what ever they like, no matter what is going on with the world economy.  They spend money on all of the best the world can produce: yachts, jet planes, automobiles, mansions, art, buildings, and the corporations that make these items for them.  They are not hurt by monetary losses and donate millions of dollars to charity to cover the heavy tax burden of having so much money.

So come to an understanding if you are part of the working class and open you eyes to voting for a person in government that will represent your economic standing and has your blind side covered.   Our country needs open ended positive ideas to make this a better country for all Americans, we need to move in a way that will push all of us forward.

A Facebook on-line chat right before this article was written:

K: The republicans are getting away with murder at the hands of inept Democrats.
First they demand tax cuts in face of weak economy, then they demand  government cuts due to huge government debt.

Democrats are not able to even stammer through and say the Republicans should hand back tax cuts if they were so really concerned with debt.

Republicans want to slash and burn government spending further weakening the economy. So that they have continued the weak economy - causing democrats to lose another big election.  All the while breaking unions so democrats won't have any financial support. Still looking for work?  Consider running for office!

N: The only thought I have is the same on I had a long time ago, just with a different reason.  Those with money still have money (mostly Republicans).  Those without money are the working class (mostly Democrats).K: Because the working class doesn't pay attention!N: With that thought, it also carries over to those working in the government, they are out of touch. The stock market is up. Unemployment is still as high as it has been all during the great recession as any improvements in the numbers are due to the long term unemployed no longer being counted.  The people in government have jobs and money and no worries.

Yes, it was that the working class is not in touch with the big picture, they believed the government and republicans when borrowing money and spending drove the economy during Bush's time.K: Working people don't pay attention and vote based on "thought leaders", it's almost mind washing which can only explain how people would vote against there own interests. The unemployed tend not to vote.N: Because in the end "working class" think they are the "middle class" the republicans are defending.   In the end the middle class the republicans are talking about have incomes over $250K and do not lose everything in economic downturns.  The rich still have money.  The poor lose all or most of their income when they lose their jobs.K: The public needs to get its head out of the sand.N: This is the where the republican thinking sounds good, but the working class are not really included in all of the tax benefits.  Something about perception and actual lifestyle. Republican thinking does not protect workers of companies, it protects the owners.  But the workers think it is directed at them.K: Agreed- need people to be called out for this.N: Ok, this will be my follow up story to get people to understand who they are to get this government to change before a revolution rolls around the world our way.