As a commercial pilot with 30 year's experience, I can tell you that there is no more sickening feeling than hearing your stall warning alarm during a takeoff.
That is exactly what I was hearing Friday morning when the Department of Labor announced that June nonfarm payrolls fell by 125,000.
The unemployment rate fell from 9.7% to 9.5%, and no doubt this will be the headline. The broader measurement of unemployment, which includes discouraged workers, also dropped a smidge to 16.5%.
But those accomplishments were achieved because 650,000 workers abandoned the labor force, shrinking the base. The only bright spots were the 83,000 private sector jobs that were gained and the 15,000 in upward revisions in the April and May numbers.
There is no doubt momentum is fading, and that there is a downshift in private sector hiring underway. The BP oil spill is having an immeasurable effect, as thousands of oil workers, fishermen, and tourist industry staff were sent to the dole queue.
The unemployment rate for those with college degrees is at 4.7%, higher than in past recessions. Those now jobless face a long search.
At the current rate, it will take six years to recover the 8 million jobs that vanished during the Great Recession.
The most severe economic crisis in 80 years will generate similarly frightening pull backs in any recovery, and I think this is one of them. It looks like there will be no fireworks for this Fourth of July after all.
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Courtesy: Mad Hedge Fund Trader
