$816 billion / 4 million jobs = $204,000/job
This is an oversimplistic way of looking at economics. But most of us make less than $204k/year, so the aggressiveness of the plan is pretty clear.
Wednesday, January 28, 2009
Wednesday, January 21, 2009
Lewis and Dimon Lead the Confidence Rebound
Money Where There Mouths Are
How can we restore confidence in the banks and the financial system? Here's a start: today we found out Ken Lewis and Jamie Dimon independently put their own money on the line. Lewis, the CEO of Bank of America, bought 200,000 shares of Bank of America stock for around $1.2 million. Dimon, the CEO of JP Morgan Chase, bought 500,000 shares of JP Morgan Chase for around $11.5 million.
Who could understand the big banks better than the bankers running those banks?
Maybe the financial system won't collapse afterall.
How can we restore confidence in the banks and the financial system? Here's a start: today we found out Ken Lewis and Jamie Dimon independently put their own money on the line. Lewis, the CEO of Bank of America, bought 200,000 shares of Bank of America stock for around $1.2 million. Dimon, the CEO of JP Morgan Chase, bought 500,000 shares of JP Morgan Chase for around $11.5 million.
Who could understand the big banks better than the bankers running those banks?
Maybe the financial system won't collapse afterall.
Friday, January 9, 2009
Job Cuts So Bad, It's Good?!
The Data
This morning we found out that U.S. employers cut 524,000 jobs in December. The unemployment rate hit 7.2%. The data is ugly, any way you look at it.
The History
2.59 million jobs were cut in 2008. This is the worst number since 1945. The unemployment rate is at a 15 year high.
The Surprise
Unlike previous job reports, which I noted in my Oct. 11, Nov. 7, and Dec. 5, the new data was roughly in line with expectations. Economists were expecting 525,000 job cuts and 7% unemployment.
Although the data is bad, I can no longer argue that the economists were being overly optimistic. It seems like the experts have come to grips with how bad things are.
A Review
When I started this blog in Oct 11, the U.S. lost 760,000 jobs through September. Most of you know that I've been extremely negative with regard to the economic outlook. More negative than most. However, I never imagined we would've lost 2.59 million by year end.
Always Darkest Before the Dawn
It has taken several months for the public to come to grips with reality. Even president-elect Obama will tell you things will get worse before it gets better.
But there's good news in this bad news. The high degree of concern has made consumers and businesses extremely conservative. When spending sinks and job losses soar, we are more likely to get to the bottom of the recession sooner than later.
In other words, we can get a short, deep recession. Most argue this is better than a long, drawn out recession. You'd probably agree it's better to have things be really bad, but for a short period of time. Think about the brazilian wax; short and painful, but preferred over hair-by-hair tweezer plucks.
If we can get to the bottom of the recession, then we can start growing again. It's that simple.
One More Thing...
The purpose of this blog was to cut through the BS, and communicate the reality. I believe the media is now telling you exactly how bad it is...in English.
So, until that changes, expect fewer posts. You can get your information from the newspaper.
This morning we found out that U.S. employers cut 524,000 jobs in December. The unemployment rate hit 7.2%. The data is ugly, any way you look at it.
The History
2.59 million jobs were cut in 2008. This is the worst number since 1945. The unemployment rate is at a 15 year high.
The Surprise
Unlike previous job reports, which I noted in my Oct. 11, Nov. 7, and Dec. 5, the new data was roughly in line with expectations. Economists were expecting 525,000 job cuts and 7% unemployment.
Although the data is bad, I can no longer argue that the economists were being overly optimistic. It seems like the experts have come to grips with how bad things are.
A Review
When I started this blog in Oct 11, the U.S. lost 760,000 jobs through September. Most of you know that I've been extremely negative with regard to the economic outlook. More negative than most. However, I never imagined we would've lost 2.59 million by year end.
Always Darkest Before the Dawn
It has taken several months for the public to come to grips with reality. Even president-elect Obama will tell you things will get worse before it gets better.
But there's good news in this bad news. The high degree of concern has made consumers and businesses extremely conservative. When spending sinks and job losses soar, we are more likely to get to the bottom of the recession sooner than later.
In other words, we can get a short, deep recession. Most argue this is better than a long, drawn out recession. You'd probably agree it's better to have things be really bad, but for a short period of time. Think about the brazilian wax; short and painful, but preferred over hair-by-hair tweezer plucks.
If we can get to the bottom of the recession, then we can start growing again. It's that simple.
One More Thing...
The purpose of this blog was to cut through the BS, and communicate the reality. I believe the media is now telling you exactly how bad it is...in English.
So, until that changes, expect fewer posts. You can get your information from the newspaper.
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