The paper has articles today about the "disappointing" jobs report for the month of March. Turns out that employers only added a net of 88,000 jobs last month, not even enough to keep pace with the additions to the "labor force" as the result of people newly entering the job market, much less to reduce the vast legions of the unemployed. Of course, since the officially-acknowledged "unemployment" or "jobless" rate doesn't include people who've given up looking for a job because the economy (on "Main Street," not "Wall Street") is so bad, some economists estimate that the "true" unemployment rate is 9.8% or greater, not the still-dismal-but-lower-than-last-month 7.6% that the government is touting.
To put this into perspective, as of May, 2012 there were officially 12.6 million people "unemployed." But there were another 88 million working age adults who weren't working, but were not counted as "unemployed" because they had been defined out of the "workforce" entirely. As their unemployment runs out, and they give up their job search in frustration, additional persons are dropped from the "workforce" each day.
A more revealing statistic is that the "workforce" is shrinking. At this point in time, only about 63% percent of the working-age population of the U.S. is working or seeking work. The rest are either retired, rich, on public assistance or starving. As for the stock market, which too many people put too much stock in as an indicator of the health of the overall economy, an interesting statistic is that the number of publicly-traded stocks is apparently shrinking, too. Some of that (O.K., a lot of it) is due to mergers. Some of it is due to companies being taken private. Factoring in the flight from equities by the "ordinary" individual investor in the wake of the financial upheavals of the last couple of decades, plus the insanity created by huge banks of computers processing day-trades in nanoseconds, programmed to analyze and take advantage of "trends" in trading, as opposed to fundamentals, and what do you have? Fantasyland.
The people whose economic reality is closely tied to the vicissitudes of stock prices or can derive any information of practical import from poring over indexes of stock prices are becoming fewer and fewer in number. In fact, fewer than half of all American households own equities in any form, and fewer than half of those own stocks or mutual funds outside of an employer-sponsored plan. What most people want in order to feel prosperous is a house that is worth something and a job that pays them enough to pay for it, and frankly, my dear, they don't (and probably shouldn't) give a damn about the Dow, which is what most people are referring to when they say "the market is up... or down... or flat).
The Dow is an index of only 30 stocks, anyway. Big company stocks, it is true. But only 30 of them, and these companies in the aggregate only employ a small fraction of the American "workforce." In the aggregate, much of their own "workforce" is elsewhere in the world, and they generate a lot of their revenues overseas. While it used to be true that "what is good for General Motors is good for America," that was when GM was making and selling most of the cars here and its "workforce" was making a solid middle-class living that involved a lot of spending on other American goods and services. Now Detroit is pretty much an abandoned area, and the unemployed are driving their Toyotas and Hondas over to the unemployment office to wait for their checks (or they are until their unemployment benefits run out, anyway). And some companies that are still making lots of money here, like McDonalds or the big tobacco companies, are doing so at the expense of the health and well-being of everyone with whom they come in contact.
You have to read between the lines of these statistics a little bit, but if you do you will rapidly come to an understanding of how it is that there are zillions of unemployed people, zillions of underemployed people and a stock market that's through the roof, all at the same time. If you want to take the advanced course, you'll have to do some reading and thinking. Start with "The Power Elite" from the 1950's, then stir in a little Mitt Romney and Scrooge McDuck, then a lecture by Professor Richard Wolfe to explain it all. By the time you're done, you will realize that American workers are in big trouble, partly because they're not working anymore, partly because it is no longer necessary for the financial well-being of their overlords that they work... or even consume. "Multi-national" companies now make most of their money employing cheap foreign workers to make cheap goods to sell to other cheap foreign workers in far-away places that have lax environmental standards and poor industrial and financial regulation (well, okay, we've still got poor regulation here, too) and the only real domestic market they need to maintain for the comfort of their officers, directors and principal shareholders is the one for imported luxury goods.
Few of the luxury goods favored by the wealthy, and precious little of anything else, are made in the USA. They don't manufacture clothing in America anymore, for the most part (and what they do make is only T-shirts and socks), they don't make TV's or I-Phones, either. And wait a minute... what kind of a car do you drive?
We even import pet food... to the great misfortune of the legions of animals who have ingested the toxin-laced Chinese version, and their human companions who installed that asbestos-laden drywall. But let's get real. What alternatives to cheap, foreign-made goods do most people really have? If you want a bargain, shop at Wal-Mart-- it's cheaper than taking a slow boat to China for the same stuff. And while the stock broker whose bonus you bailed out a couple of years ago is drinking the fine wine that he purchased at the last wine auction advertised in the New York Times, and the plutocrats he serves are plotting their next two trillion dollar heist, you might want to check out the free samples at your local Costco. If you make a few laps around the store, you can ingest enough calories to make a complete meal, and you don't really want to read about the ingredients in all that stuff anyway.
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