This Has Never Happened Before

Phoenix Capital Research's picture


The economic recovery hit another record yesterday.


We’ve already had an incredible record setting streak for food stamp usage. Now we can add high unemployment to the mix. The US economy just posted its 54th straight month at which unemployment was north of 7.5%.


This has never happened before. And the worst part is that unemployment is in fact much worse than this indicates. Indeed, the Feds implement multiple gimmicks to maneuver the unemployment number down.  The most nefarious is simply not counting those who haven’t looked for a job recently as unemployed.


BOOM! Suddenly a lot of the people who are in fact unemployed don’t count and the unemployment rate drops. After all, one cannot help but wonder how one in five US households is on food stamps, while unemployment is down near 7.5%.


A much better measure of unemployment is U6 unemployment, which measures those unemployed plus those who are unemployed and have looked for work in the last 12 months and those who are working part-time for economic reasons.


When you use this measurement, the unemployment rate is closer to 14.3%.



Against this backdrop of weak employment analysts continue to believe that the US economy will pick up in the second half of 2013. This is absolutely impossible. Weak employment means lower incomes. Lower incomes means lower consumer spending. Lower consumer spending means lower economic growth.



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Best Regards


Graham Summers

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pfairley's picture

I think over 90% of people reading Zero Hedge already know this. US government debt rating has to hit BBB or lower before most people will stop voting for guys like Obama and thinking Paul Krugman is a top economist.

 Even in countries where soccer is king...people don't seem to understand that with many 'red cards'  ...less players on the field...and many high salaried players on the bench...your economy is going to lose.

sosoome's picture

Not to worry. OBarryCare will provide plenty of jobs.

Stuck on Zero's picture

We don't need consumer spending.  We have the Fed.


PiratePiggy's picture

After 50 years of Lyndon Johnson's "War on Poverty", the result is more people on food stamps than ever before.


Similar results with education in the 30 years since the Department of Education was begun.



PiratePiggy's picture

After 50 years of Lyndon Johnson's "War on Poverty", the result is more people on food stamps than ever before.


Similar results with education in the 30 years since the Department of Education was begun.



worbsid's picture

With the price of gas going up and $103 WTI it will be a while before anyone has any discretionary money to spend.

andrewp111's picture

After-Tax personal income could be systematically wrong if more and more people work off the books.

WTFUD's picture

Problem is the ussa opposition are fragmented and despite sharing common goals are very easily led by msm into bitching on the differences amongst one another thereby allowing the steadfast criminal united minority to blinside them. Despite access to the real world issues readily available ignorance remains supreme.

docj's picture

Recovery Summer IV. Just as crappy as I, II and III because, well, it's the same freaking script, without any substantive change, and it has never, ever worked.

Yet the Great American Sheeple continue to spend what little is left of their disposable income on this latest sequel because, I guess, they think the leading man in this farce - none other than King Putt - is "cool" and "hip", has darker skin and is not Mormon or something.

Let it burn. We deserve it.

max2205's picture

GS...rinse, repeat

cynicalskeptic's picture

Shadowstats has unemployment at 23-24%


We're worse that the 1932 peak Great Depression numbers  but it's a lot easier to lie about the numbers than fix the problem

BTW - all the financial institutions that got biollions (trillions) in TARP money are now adding back office accounting functions to the jobs being offshored.  You think one condition to all that aid would be having them bring BACK all the Data Processing and call center jobs they'd offshored. but instead they're getting tax credits for killing off MORE jobs.

Westcoastliberal's picture

You've got that fucking right.  We're on our way to becoming the land of "Hunger Games" in reality.

And no Federal government official will admit the truth.

sterling effort's picture

The U.S. Department of Agriculture estimates that a total of 101,000,000 people currently participate in at least one of the 15 food programs offered by the agency.

According to the Bureau of Labor Statistics there were 97,180,000 full-time private sector workers in 2012.

If you are employed full time in the private sector you now have your own personal parasite. Do we get a photo at Christmas like the world vision folk send out?

Henry Hub's picture

***If you are employed full time in the private sector you now have your own personal parasite.***

The really sad thing is that many who are "employed full time" are eligible for and are collecting "Food Stamps". I guess this makes them both parasite and host.

Jumbotron's picture

That's exactly right Henry. Time for folks like Sterling to change their perspective a bit and get with reality.  Not that I'm saying we approve of it, or the situation.  Far from it.

But the percentage of free loaders in that group is now a HELL of lot smaller simply because of the increase of people who used to talk like Sterling....but now in order to help put food on the table...are doing the very thing they used to bitch about other people doing.

When you speak in ignorance.....don't be surprised when Ms. Karma comes and kicks you in the balls.  She can be a bitch.

Rainman's picture

Damn... I just knew this is why we never see chow lines on the street < circa 1931 > ! 

The machines are running this food thing too !

cossack55's picture

Yes, and the machines are owned and operated by JPM

Uncle Remus's picture

Well, the EBT ones anyway...

SokPOTUS's picture

No; those are made by Diebold.  You know what they say..."Vote 'D' for Diebold!!!"

Imminent Crucible's picture

"Lower incomes means lower consumer spending"

Huh? When did they come up with that stupid concept? What are credit cards for? Why is California able to spend more than ever, despite lower revenue at the state and muni levels? Why does the Federal Govt spend a trillion bucks more than they have coming in, year after freaking year?

Live within your means---that is so Last Century. I'm sure this is all going to work out fine, just like Argentina.

CheapBastard's picture

True that. But malls this weekend were dead. The few seniors doing their fast get-in-shape walks ... a smattering of teens pushing each tother around as they try not to fall with their jeans pulled down to their knees showing off their dirty underwear (I assume this is a 'style')....few, very few 'consumers' buying anything more then a little this or that with their stack of coupons.


Today it was deader. I told a store clerk why not read a good Dickens to keep awake and they looked at me with their puzzled fuzzy eyes, "What's that about? Sounds dirty."



Bear's picture

In SoCal the malls are hopping, parking lots overflowing (in July too). Going to a restaurant means a long wait on Fri/Sat. Homes that sat on the market for 12 months are now selling in one weekend.  My daughter's home bought last June for 281 is now worth 415. I scratch my head ... how can so many people have so much money (or credit). It looks just like the roaring 2005's all over again.

Imminent Crucible's picture

SoCal is a bit of a special case. Real estate is still "local" and SoCal is as local as it gets, for private equity and former Chinese bureaucrats. What you're seeing there is private capital desperate for yield piling into rental REITs (doomed to disappointment as costs rise and yields plummet) plus the leadership change in the ChiCom Party.

The last regime stole as much as they could as fast as they could, and then they wired the money out to banks in Cali. Next they shipped their families out, and when they lost office in the recent election they caught the first flight to LAX or SFO. Now they're home shopping, and they gots plenty of ill-gotten booty to spend. Or ill-booten gotty, I forget which.

Never One Roach's picture

yeah, I read USA is probably their #1 off-shore haven for Chinese booty. Heads have looked the other way as realtors write up the sales contracts as fast as possible before someone squeals and spoils the goose.

Quantum Nucleonics's picture

How come this author isn't pimping his newsleter/website?  Maybe because all his prognostications of impending doom have failed to come to pass?

rsnoble's picture

My neighbor came over to apply for aid on my pc today.  He's been trying so I don't really have a problem with it.  All the $ the US blows they can just shut the foreign bullshit down and take care of the brewing domestic problem or they're not going to have to watch tv to see Egypt it will be right fucking here.

Bear's picture

We have to shut down DC first, or it will never happen.

Psquared's picture

The game is not over, but it's 3rd and long with time running out and the QB has a gimpy leg.

Here's my preview of what is going to happen. We will stumble along until the end of Obama's term by fudging numbers and propping up this and that. If the Middle East blows up (possible, maybe even probable) that could change. A host of other things could happen including a major terrorist attack or a currency crisis. My guess is that those won't happen, but the economy will not improve either. Republicans will win the White House and the Senate in 2016 and will begin a series of rollbacks and a new program of "deregulation" claiming that it will help the economy. Food stamps will be curtailed or limited. unemployment will be scaled back, the Affordable Health Act will be repealed, Dodd-Frank will be repealed and Wall Street will be further deregulated, the SEC budget and enforcement powers will be reduced, taxes on the wealthy and on corporations will be reduced and military spending will increase. The argument, of course, will be that building ships and tanks and guns creates jobs and we have to protect our security and our welfare. (READ: cover the politicians and bureaucrats asses) Screw bridges and roads; screw the poor and underprivileges; screw Medicaid and Medicare and let the poor and the old and infirm die or starve. Sorry, but charities will have to take care of all that. We can't afford it, but we can afford to make the wealthy even richer, mega-corporations bigger (even though they aren't hiring anyone) and wage wars.

Westcoastliberal's picture

You totally disregarded the alien threat coupled with all the NSA spying on Americans.  On 9/10/01 (day before the infamous 9/11) Donald Rumsfeld announced $2.3 Trillion couldn't be accounted for by the Pentagon.  That's a sack of money.  Probably spent on highly compartmentalized "black ops" programs, some say involving EBE's (Extraterrestrial Biological Entities). Ben Rich, former head of the "Skunkworks" that developed the SR71 Blackbird among other exotics, was quoted at a conference as saying "We have the technology to take E.T. back home".

It was announced recently we've been receiving unexplanable "Radio bursts" from outside the Milky Way.  One scientist says there may be 10,000 or more such "bursts" every day; we're just missing them because we're no listening in that direction or frequency.

Rumor is, we already have a "Navy in space". At least that's what hacker Doug Mackinnon found, with ships listed not in the official roster along with officers names and assignments.  U.S. efforts to extradite him and do a Bradley Manning were thwarted by the Brits.

Now follow me....every angle I've read on the NSA spying is from the "avoiding terror" meme.  What if the whole "terror" thing is a crock, and the spying is actually to get a profile on each American so detailed as to create a matrix for aliens to truly understand Humans and accomplish their goal (whatever that is)? Thousands of people have reported abductions (check), and plenty of evidence exists for strange, surgical, cattle and other animal mutilations. Rumor has it the Aliens work alongside Humans under Dulce mountain in NM.

Sounds highly expermental to me.

So if you open your mind a bit, and include some of these factors, the scenario you've outlined is pedestrian.  Good luck Humans.

are we there yet's picture

I like your freedom of thought, but aliens on earth are only suitable for science fiction movies. I did like the recent movie called Nazis from the dark side of the moon though.

Citxmech's picture

I'm not so sure about the Senate - I think that may be more of an even split.  But for POTUS - I'm not even sure if party ideals matter anymore as much as which walking "shit-cocktail" appears to be the least offensive.

Both parties are going to have a really tough time finding anyone that is actually electable.

Hillary?  Jeb?  Biden?  Rubio?

Christie is probably the best bet I can see for the Rs.  We'll have to see if he's motivated enough to lose some weight dance like a clown for the banker/MIC though.

SokPOTUS's picture

Christie's a Walking Heart Attack.  I'd vote for him though if Rand Paul is his VP.

Zosynspiracy's picture

Are you f'ing kidding?  Rand Paul should be in the White House!  His dad was the last best thing that could have happened to this country.  His son isn't quite the same but is still better than 99% of the other shit walking around calling themselves "leaders".  Christie is a fat POS!  He's no different than any other douchebag Republicant out there.  First thing that party needs to do is start offing the likes of Romney, Perry, Mcstain, Palin etc.! 

Bollixed's picture

"Both parties are going to have a really tough time finding anyone that is actually electable."

Actually, with the backing of the brain-dead press and enough money they could get an undocumented alien, with no experience, who can barely speak without reading the words, won't take responsibility for anything that makes him look bad, is a pathalogical liar and a sociopath whose past history can't even be confirmed to be elected if they wanted to...

Zosynspiracy's picture

Don't forget closet Muslim............

SokPOTUS's picture

But wait; both McCain and Romney lost...

odatruf's picture

Won't happen, Bollixed, the 22nd Amendment to the Constitution prevents a third Obama terms (or another Bush one, as if that matters).


worbsid's picture

By Presidential Decree the 22nd Amendment is hereby null and void.  Why not?  The fourth is shot to hell.

SokPOTUS's picture

Face it; we're back to Bush/Clinton - Clinton/Bush.  Hell; it could be another 16 years of that crap; 8 Hill and 8 Jeb.  More likely than not, actually.

All name recognition and money-raising apparatus.  The Clinton and Bush machines aren't dismantled; just idling...


hivekiller's picture

Well there's Hillary-Cunt. Then Jeb the Bushwacker. Then there's Chelsea Clinton-Cunt. Then there's Jeb Bush's half hispanic son. Then there's the Clinton's cat - Sox...... and on and on and on.

Bollixed's picture

Well, being as the current administration's slogan is: "Amendments? We don't need no stinking Amendments...", I'm not so sure.


Uncle Remus's picture

[control barrier dujour], we don' need no [control barrier dujour]

Rainman's picture

They better bring a lot of timber to prop up those this-and-that public pension funds

CheapBastard's picture

orin Hatchet of Utah is proposing just that; namely, bailing out the massive underwater Gubmint pension plans. Can you guess with what? Namely, where will he get the money to keep the fat flowing to the gubmint sector?

Can you guess?



BTW, I notice O-Rin was never this enthusiastic about bailing out small businesses and the private sector like he is now for the muni/pubic sector.