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Obama Recovery: January Unemployment Rises to 7.9%

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Photo Credit: Susan Trigg The new year started off with an old story: Employment grew again in January but not at a pace able to lower the jobless rate.

Nonfarm payrolls rose 157,000 for the first month of 2013 while the unemployment rate edged higher to 7.9 percent, news unlikely to alter the Federal Reserve’s monetary policy or instill confidence that the recovery is gaining steam.

Economists were looking for 160,000 net new jobs created with the unemployment rate holding steady at 7.8 percent.

The ho-hum jobs numbers for January were accompanied by substantial revisions higher for previous months, according to the report from the Bureau of Labor Statistics . . .

A report earlier this week indicated that third-quarter growth actually contracted 0.1 percent, but Friday’s jobs numbers contradicted the gross domestic product read.

Read full story HERE.

Welcome to QE4!

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photo credit: dctim1

The actions of the Federal Reserve over the past 4 years exemplify insanity more than anything else in politics. They continue implementing one monetary stimulus policy after another in an attempt to jumpstart the economy, even though they keep failing in that goal. We had QE1,2,3 and Operations Twist 1 and 2. Now the Fed’s Open Market Committee has announced a new monetary stimulus package that can only be described as QE4.

Evidently, the economy was recovering enough for Obama to win reelection, but not enough to end the market distorting, dollar-destroying stimulus from the unelected governors at the Fed. So not only will the Fed continue purchasing $40 billion in mortgage-backed securities per month, they will engage in another round of buying long-term treasuries:

“To support a stronger economic recovery and to help ensure that inflation, over time, is at the rate most consistent with its dual mandate, the Committee will continue purchasing additional agency mortgage-backed securities at a pace of $40 billion per month. The Committee also will purchase longer-term Treasury securities after its program to extend the average maturity of its holdings of Treasury securities is completed at the end of the year, initially at a pace of $45 billion per month. The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and, in January, will resume rolling over maturing Treasury securities at auction. Taken together, these actions should maintain downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative.”

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Liberals Suggest that Obama Mint Two Trillion Dollar Coins to End Fiscal Crisis

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If President Obama wants to avoid an economic calamity next year, he could always show up at a press conference bearing two shiny platinum coins, worth… $1 trillion apiece.

Okay, that sounds utterly insane. But ever since last year, some economists and legal scholars have suggested that the “platinum coin option” is one way to defuse a crisis if Congress can’t or won’t lift the debt ceiling soon. At least in theory.

The U.S. government is, after all, facing a real problem. The Treasury Department will hit its $16.4 trillion borrowing limit by next February at the latest. Unless Congress reaches an agreement to raise that borrowing limit, the government will no longer be able to borrow enough money to pay all its bills.

Last year, Republicans in Congress resisted lifting the debt ceiling until the last minute — and then only in exchange for spending cuts. Panic ensued. So what happens if there’s another showdown this year?

Enter the platinum coins. Thanks to an odd loophole in current law, the U.S. Treasury is technically allowed to mint as many coins made of platinum as it wants and can assign them whatever value it pleases.

Under this scenario, the U.S. Mint would produce (say) a pair of trillion-dollar platinum coins. The president orders the coins to be deposited at the Federal Reserve. The Fed then moves this money into Treasury’s accounts. And just like that, Treasury suddenly has an extra $2 trillion to pay off its obligations for the next two years — without needing to issue new debt. The ceiling is no longer an issue.

Read more from this story HERE.

Videos: Rick Santelli-GDP Numbers Are `Depressingly Weak,’ Slams Federal Reserve

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In this first video, Rick Santelli responds to the Obama Administration’s suggestion that things are improving in the US economy.

Santelli’s stark assessment couldn’t be more different than Obama’s. He describes the manufacturing industry, other economic indicators as “depressingly weak”:

In this longer video, Santelli slams the Federal Reserve as being disconnected from reality, taking action that will do nothing for the economy.

This starts a little past the 5 minute mark if you want to jump forward:

Bernanke Pursuing Failed Policies of the Past, Pushing For Yet Another “Stimulus”

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Photo Credit: DerFussi

The Federal Reserve chairman, Ben S. Bernanke, delivered a detailed and forceful argument on Friday for new steps to stimulate the economy, reinforcing earlier indications that the Fed is on the verge of action.

Calling the persistently high rate of unemployment a “grave concern,” language that several experts described as unusually strong, Mr. Bernanke made clear that a recent run of tepid rather than terrible economic data had not altered the Fed’s will to act, because the pace of growth remained too slow to reduce the number of people who lack jobs.

The federal government said on Wednesday that the economy expanded at an annual rate of 1.7 percent in the second quarter, slightly higher than its initial estimate of 1.5 percent but lackluster in normal times. A measure of consumer confidence hit a three-month high on Friday, but that, too, was impressive only in comparison with the immediate past. The government will release a preliminary estimate of August job growth next week; it is expected to show that the unemployment rate remains above 8 percent.

Mr. Bernanke said that the Fed’s efforts over the last several years had helped to hasten economic recovery, that there was a clear need for additional action and that the likely benefits of new steps to stimulate growth outweighed the potential costs.

“It is important to achieve further progress, particularly in the labor market,” Mr. Bernanke said. “Taking due account of the uncertainties and limits of its policy tools, the Federal Reserve will provide additional policy accommodation as needed to promote a stronger economic recovery and sustained improvement in labor market conditions in a context of price stability.”

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Libertarian Gary Johnson asks for support of Ron Paul Voters

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Photo credit: Gage Skidmore

Libertarian Party presidential nominee Gary Johnson was nowhere to be seen at the official Ron Paul rally in Tampa, but he did make a pitch to Paul’s voters at this weekend’s grassroots-organized Paul Fest.

“I want you all to know that I am a Dr. Paul fan,” Johnson, a former two-term Republican governor of New Mexico, told the crowd to loud applause.

Johnson emphasized his agreement with Paul on foreign policy and auditing the Federal Reserve as he made the case that he is the best candidate to move the Texas congressman’s message forward in the presidential race.

Initially, Johnson sought the Republican nomination for president while Paul was still a candidate, but he told the crowd he had long been a Paul supporter. “Ron Paul asked me for my endorsement in 2008 and I readily gave him that endorsement,” Johnson said. “When I dropped out of the Republican primary, I asked everyone who was going to vote for me to vote for Ron Paul.”

Cheers erupted when Johnson reminded the audience that, during his final appearance in the Republican presidential debates, he said he would pick Ron Paul to be his running mate if nominated.

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Romney backs Ron Paul’s “Audit the Fed” & Bush’s “read my lips” pledge

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Photo Credit: davelawrence8 Creative Commons

Borrowing a key element of the anti-government libertarianism that fueled rival Ron Paul’s presidential campaign, Mitt Romney said Monday that he thinks the Federal Reserve should face an audit:  “Very plain and simple, the answer is yes. The Federal Reserve should be accountable. We should see what they’re doing,” Mr. Romney, the presumptive Republican presidential nominee, said at a town hall in New Hampshire.

Mr. Romney also pushed back against President Obama’s claims that the former Massachusetts governor would raise taxes on the middle class if elected.

“Let me tell you the heart of my tax proposal: I will not raise taxes on the American people, I will not raise taxes on middle-income Americans,” Mr. Romney told supporters at St. Anselm College, where he and running mate Rep. Paul Ryan made a grand entrance to the theme song from the movie “Rudy.”

The visit marked the first joint appearance for Mr. Romney and Mr. Ryan in New Hampshire — a state that could prove pivotal come Election Day.

The event gave Mr. Romney a chance to fire back at Mr. Obama, who two days earlier in nearby Windham told voters that Mr. Romney’s tax plan would mean that the wealthy get a tax cut and middle-class families will pay more.

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House passes Ron Paul’s ‘Audit the Fed’ bill; Bernanke calls it a “nightmare scenario”

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In a move that serves as a capstone to Rep. Ron Paul’s colorful career, the House on Wednesday voted to have Congress‘ chief investigators conduct a full audit of the Federal Reserve’s shrouded decision-making process.

The overwhelming 327-98 vote sends the measure to the Senate, where Majority Leader Harry Reid, Nevada Democrat, at one time expressed support for an audit — though he reportedly has changed his mind.

House passage already marks a high-water mark for those who for years have been pushing for an audit, led by Mr. Paul. The Texan rode the slogan “Audit the Fed” to prominence in two Republican presidential primary campaigns, and he said the bill is a chance for Congress to begin to reclaim the money and banking powers it is given in the Constitution, but had delegated to the Fed.

“It is up to us to reassert ourselves,” Mr. Paul said during floor debate Tuesday.

Fed Chairman Ben S. Bernanke doesn’t like the prospect of such a broad audit, calling it a “nightmare scenario” last week and saying it would lead to politicians second-guessing his decisions.

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Photo credit:  Joe Miller, All Rights Reserved.