Poor Mr. Obama. They’re calling him “President Zero.” Why? Because August produced zero new jobs.
But we Daily Reckoners were way ahead of the story. Almost everywhere we look we see a circle with a hole in it.
How many new jobs have been created in the last 10 years? Zero.
There were about 130 million jobs in America in the year 2000. There are about 130 million today.
How much more does the average wage-earner make? Zero. Adjusted for inflation, he made about $16 an hour in 2001. He still makes about $16 an hour.
How much more are stocks worth? Zero.
How much more does a house sell for? Zero.
By all the important measures, Americans are Zero better off than they were a decade ago.
But wait. They’re much worse off. They have much more debt. Here are some numbers that aren’t zero. In round numbers, total debt to GDP increased from around 200% to over 350%. Federal debt alone went from 57% of GDP to nearly 100% today.
And now the markets are beginning to realize what happens to prices when there’s too much debt in the system.
The Dow was down 100 yesterday. No relief from the bear market.
Gold down $3.
At least, gold is moving in the direction we think it OUGHT to move. Not that we’ve got anything against it. But gold is up a whopping 33% this year. That ain’t natural. It ain’t normal. And it probably ain’t gonna continue.
Don’t get us wrong. We’re gold bugs. We believe the feds are the problem and gold is the solution. But we weren’t born yesterday. And we don’t think the time has come for gold to make its final, blow- off climax.
No, dear…dear reader. We’re still in the foreplay stage. The hot action will come later. Probably much later.
In the meantime, we are in a Great Correction…and now, at last, almost everyone knows it. There was no normal recession. And now there’s no normal recovery.
The latest proof came from the employment numbers. The New York Times was on the story:
The government report on hiring, released on Friday, prompted another round in a relentless diminution of economic expectations. The unemployment rate, at 9.1 percent, did not change last month, and the White House said it was expected to stay that high through at least 2012.
The optics of a giant zero in the jobs column — more symbolically powerful, perhaps, than even a small decrease might have been — increase the pressure on President Obama as he prepares to deliver a major address on job creation next week, on Republicans who have a starkly different approach to economic revival and on the Federal Reserve, whose policy makers have been divided over the wisdom of using its limited arsenal of tools to get the economy moving again.
The White House immediately seized on the report to bolster the president’s impending call to action. Republicans countered that the numbers were further proof that the stimulus policies of Mr. Obama, whom they quickly dubbed “President Zero,” were not working.
This is not the first time that job growth, the most important measure of the economy for many Americans, has ground to a halt since the recovery. It dropped into negative territory in the middle of last year after three months of strong showings. This time, the slowdown comes after the earthquake in Japan, a spike in oil prices and the European debt crisis, in addition to political gridlock in America.
No, the quack remedies aren’t working. But that doesn’t mean they aren’t popular. In fact, we’ll make a prediction. The less they work, the more popular they’ll become.
That’s the formula for success in a city like Baltimore. You fail. They give you money.
It will become the feds’ favorite formula too. Their recovery claptrap won’t work. The economy will drag its butt down Tokyo lane…and people will clamor for more bailouts. President Zero will have to ‘do something.’
We expect he’ll come up with some Rooseveltian jobs program. How many real jobs will it add? A big, fat zero.
And more thoughts…
Home again, home again…back to B-more…
Baltimore is, of course, a dump. But it’s our dump. We like it. Drenched in rain, the city glistens. It has been hosed down by a hurricane and now looks almost clean.
Compared to the gritty streets of the Bowery and the Lower East Side, the Mount Vernon area of Baltimore is pristine.
This weekend, we drove up to New York. Elizabeth’s car wouldn’t start after sitting for two months, so we took the pickup. The truck — a Ford F-150 — is very comfortable. But it has a badly-dented tailgate, a victim of your editor’s rush to put away things just before leaving for Europe. He had backed up a little too fast and ran into a tree. So, we had to tie a piece of rope onto the bumper in order to steady the tailgate on the back of the truck.
We listened to Paul Johnson’s “History of the Jews” as we made our way up the New Jersey turnpike to New York.
“We’re going to meet a lot of Jews in New York,” Elizabeth explained. “We should learn something about their history.”
The history of the Jews was fascinating, largely because there was so much of it. We had barely arrived at the time of David when we drove into lower Manhattan and found our rather chic hotel. We drove up to the front entrance. The valet parking attendant looked a little puzzled.
It was then that we realized that we looked like hicks. We were driving up to one of the city’s most fashionable and hippest hotels in a beaten up pickup truck.
“This is embarrassing,” said Elizabeth.
“No, it’s a mark of distinction,” we replied.
“Deliveries in the back,” said the attendant.
*** What is most interesting about the history of the Jews is that there is so much of it. The Jews had history when your editor’s Irish ancestors still walked on four legs and barked at the moon. And what a tale it tells!
Was there any tribe in the Middle East with whom the Jews didn’t go to war? Was there any error, sin or misfortune that the Jews had not committed or suffered? Is there any glory they have not enjoyed?
History is largely a record of war, disaster and misgovernment. And the Jews have more history than anybody. They kept records. They remembered. They taught and reminded.
Menachem Begin and the other terrorists who founded the modern state of Israel in the early 20th century surely studied how their ancestor Joshua had conquered Canaan three thousands earlier. Moshe Dayan must have felt the blood of David in his veins as he slew the Arabs and Syrians. Today’s president of Israel, Benjamin Netanyahu, must also learn from King Herod’s example from two thousand years ago.
But there has always been an uncomfortable tension between the Jewish culture and religion on the one hand and Jewish government on the other. The Israelites developed the world’s most advanced and sophisticated literature. In commerce they were unsurpassed. Their religion was perhaps the most humane ever. Asked by a cynic if the Torah could be understood by a man standing on one leg, the rabbi Hillel, about the time of Christ, responded:
“That which is hateful to thyself do not do it to another. That is the whole law. The rest is just commentary.”
But when it came to government the Jews made as big a mess of it as everyone else. David may have been a freedom fighter, but Solomon was a despot. Judah Maccabee may have been a reformer and a purist, but Alexander Jannaeus was a monster. He was the first to adopt the Roman practice of crucifixion, which he took up with some relish. In one orgy of meanness, he had 800 of his enemies crucified…and while they were still living, he had their wives and children brought out and their throats cut before their eyes. King Herod was little better.
Political power corrupts. Many Jews thought they were better off without it. They figured they couldn’t serve two masters. Either they were true to their religion. Or they bent to political necessities, which they saw as evil.
Like the rest of us, Jews seem to do best when they stay out of politics. They flourished under the Persians, the Seleucids, even the Babylonians. The Egyptian captivity, for that matter, was probably not so bad either, at least in the beginning. But in the 2nd century AD Roman Emperor Julius Severus, putting down the Bar Kokhba Revolt, practically wiped out the Jews in Judea.
That’s as far as we’ve gotten.
for The Daily Reckoning Australia