EconomicCrisis.US

US President Barack Obama nominated Alan Krueger, a Princeton University expert on unemployment, as his top economic adviser as he plots an “urgent” new offensive on the jobs crisis.

Obama described Krueger as one of America’s top economists who understood the challenges that country faces, with a recovery that has been too tepid to to make significant cuts in an unemployment rate of 9.1 per cent.

Krueger, if confirmed by the Senate, will serve as chairman of the Council of Economic Advisers and succeed long-time Obama confidante Austan Goolsbee who left the administration to return to academia in Chicago.
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The number of Americans claiming new jobless benefits fell to a four-month low last week, a sliver of hope for an economy battered for days by a credit rating downgrade and falling share prices.

The jobless claims data released by the Labor Department on Thursday eased concerns that the economy was heading back into recession as feared by investors, and buoyed U.S. stocks.

Initial claims for state unemployment benefits fell 7,000 to a seasonally adjusted 395,000, the Labor Department said, the lowest level since early April. Economists had expected a reading of 400,000.
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The credit rating agency Standard and Poor’s downgraded the United States government’s credit worthiness last week to much consternation. But they were right to do so, if for the wrong reasons. In the face of complete intransigence on the part of Republicans, can Barack Obama and Congressional Democrats do anything about it? Would they even if they could?

Have you heard the news? It was in all the papers. On every news website and every TV news program from the Atlantic to the Pacific, the Canadian border to the Gulf of Mexico. The credit rating agency Standard and Poor’s, the best known of all of the rating agencies, took the bold and curious step of downgrading the credit rating of the United States Government from the platinum plated AAA down to AA+ last Friday. It’s the first time in this nation’s history that anyone anywhere has ever considered the creditworthiness of the United States anything less than iron clad.
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It might be time for another midnight ride by Paul Revere, this time warning “the creditors are coming.”

Americans seem not to have awakened to the fast-looming debt crisis that could summon a new recession, imperil their stock market investments and shatter faith in the world’s most powerful economy. Those are among the implications, both sudden and long-lasting, expected to unfold if the U.S. defaults on debt payments for the first time in history.

Facing an August deadline for raising the country’s borrowing limit or setting loose the consequences, politicians and economists are plenty alarmed. The people? Apparently not so much.
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