Your “Duh” Moment of the Day

Oh noes! Geithner says unemployment is going to go up in the short term?!?!  Well of course it is:

“When they see a little hope that there may be jobs out there, they start to come back in again. And that can cause the measured unemployment rate to go up — temporarily,” Geithner told “Good Morning America’s” George Stephanopoulos in an exclusive interview. “But what we expect to see, and I think most forecasters expect this…is an economy that’s gradually healing, gradually strengthening, businesses starting to add people back.”

Of course, this is a quick reminder that unemployment rates don’t effectively translate into those-out-of-work rates.  Unemployment only ticks up because those who are not working are attempting to find jobs again… which gives credence to the real figure of between 16-19%.

Solution?  Certainly not to end the Bush tax cuts… you’re talking about a $3 trillion drain on capital and credit should that occur, one that will stall any recovery.

Hopefully the policy wonks won’t let politics interfere with economic theory — however unsound I may believe Keynesian economics to be, this is precisely how you recover from a crisis of credit such as the one we’ve experienced thus far.

This entry was posted in Economics, National Politics. Bookmark the permalink.

Leave a Reply

Your email address will not be published. Required fields are marked *