10/05/09 Stockholm, Sweden Pacific Investment Management Co. CEO Mohamed El-Erian now sees the dismal unemployment rate as a sign of how bad the economy will look going forward. Usually the jobless rate is just considered helpful in figuring out how bad the economy has been. It’s not generally used as a signal of how the the economy will look in the future.
However, the September 9.8 percent jobless rate is a 26-year high, and it is twice what it was at the start of last year. The figure indicates that roughly 15 million Americans are right now scrambling to find work. El-Erian sees this high level of unemployment as putting significant “future pressures on consumption, housing and the country’s social safety net.”
He also refers to the strain as part of a “new normal” where the US will have less credit and fewer jobs. In light of these challenges in the economy, retailers are already scaling back their sales expectations for the coming holiday season. You can read more about this news, including new lower price targets from toymakers Mattel and Hasbro, in this Bloomberg coverage of unemployment and job losses.
Rocky Vega
Rocky Vega is publisher of Agora Financial International, where he advances the growth of Agora Financial publishing enterprises outside of the US. Previously, he was publisher of The Daily Reckoning, and founding publisher of both UrbanTurf and RFID Update -- which he ran from Brazil, Chile, and Puerto Rico -- as well as associate publisher of FierceFinance. Rocky has an honors MS from the Stockholm School of Economics and an honors BA from Harvard University, where he served on the board of directors for Let’s Go Publications, Harvard Student Agencies, and The Harvard Advocate.
The Daily Reckoning is your premier source for making sense of the news Washington and Wall Street generate. Each business day, The Daily Reckoning calls on its stable of world-class writers and thinkers to show you how to get ahead.
Start your 100% FREE subscription to The Daily Reckoning today and you’ll get a free research report, “How to Survive the Fall of Social Security.” Simply enter your email address below to get your free report and join over 495,000 worldwide Daily Reckoning subscribers!
We Respect Your Privacy and We will
Never Share or Sell Your Email Address
