EconomicCrisis.US

The nation went through ‘Back-to-School’ shopping back in August and September with barely an uptick in the economy.

We went through the longer 2009 holiday shopping season with only a slight increase in purchases over the dismal 2008 level – in December, retail sales actually fell 0.3%.

All the while on the jobs front, we remained and remain mired in a jobless recovery, with nearly 20% real unemployment and 30 million women and men either unemployed or chronically underemployed, of whom 10 million have been out of work more than half a year. These millions of effectively unemployed workers now know firsthand the sharp and painful difference between the real unemployment rate and the official rate (at 10% nearly as high as at any time since the Great Depression, but still only half the effective real rate).
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Federal Reserve Board Chairman Ben Bernanke spent most of his speech to the American Economic Association on Jan. 3 responding to the critique that easy monetary policy during 2002-2005 contributed to the housing boom, to excessive risk taking, and thereby to the financial crisis.

Many have expressed the view that monetary policy was too easy during this period. They include editorial writers in this newspaper, former Fed policy makers such as Timothy Geithner (now the secretary of the Treasury), and academics such as business-cycle analyst Robert J. Gordon of Northwestern. But Mr. Bernanke focused most of his time on my research, especially on a well-known policy benchmark commonly known as the Taylor rule.
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A new New York Times/CBS News poll offers a glimpse of the devastating human impact of the US unemployment crisis.

As massive bank bonuses are due to be announced this month, millions of people have been thrown out of their homes, find it impossible to pay for basic necessities, have depleted limited retirement savings or have lost their health care due to the unemployment crisis.

The survey of over 700 unemployed adults was conducted between December 5 and December 10. Accompanying the survey on the Times web site were self-made computer videos of unemployed workers discussing their problems.
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Several congressional Democrats said on Wednesday they plan to introduce legislation next week to cap credit card interest rates.

With unemployment and Wall Street bonuses incongruously rising together, the chairman of the House Rules Committee said she will offer a bill to cap rates at 16 percent, a proposal that could catch a wave of Populist sentiment in the House.

“Things were a lot better for the average person in this country when we had usury caps,” Representative Louise Slaughter, head of the rules panel, said in a statement.

“Watching how credit card companies have exploited people by increasing rates up to 30 percent and more is criminal and this bill will allow us to put an end to this,” she said.
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