'We Are Not Doing Very Well'

In "NBER's Martin Feldstein Bashes The Deplorable US Economy, Says Bernanke Has Engineered Another Stock Bubble," Zero Hedge highlights some less-than-upbeat commentary from a Bloomberg TV interview with economist Martin Feldstein:

Feldstein on the U.S. economy:

"We are not doing very well. The economy is just coming along at a snail's pace. The first quarter numbers that we just got last week were not very good at all. The GDP number was 2.2%. That was a disappointment, but you know, it was all automobiles. 1.6 out of the 2.2 was motor vehicle production. So, people were catching up after not being able to buy them the year before. So, this is a very weak economy. The payroll employment numbers, we are going to get some new ones in April. Let's hope they are better than March where it fell by half. The stock market is, I think, responding to the Fed. I think the real danger is that this is a bubble in the stock market created by low long-term interest rates that the Fed has engineered."

On the danger of a bubble in the stock market:

"The danger is, like all bubbles, they burst at some point. Remember, Ben Bernanke told us in the summer of 2010 that he was going to do QE2 and then ultimately they did Operation Twist. The purpose of that was to make long-term bonds less attractive so that investors would buy into the stock market. That would raise wealth and higher wealth would lead to more consumption. It helped in the fourth quarter of 2010 and maybe that is what is helping to drive consumption during the first quarter of this year. But the danger is you get a market that is not with the reality of what is happening in the economy, which is, as I said a moment ago, is really not very good at all."

I'll be danged -- another economist (see: "No Punches Pulled") who is not afraid to speak the truth.

If this keeps up, you won't need little old me any more.

Comments

[George]

Mike it is time for another book!!

[Tom]

http://www.wsws.org/articles/2012/apr2012/pers-a24.shtml

US college grads confront the dead end of the profit system
"Amid endless claims of economic recovery by the Obama administration and the media, the conditions facing the working class in the United States continue to deteriorate. This is seen nowhere more clearly than in the fate of young people, who confront a future of unemployment, low-paying jobs and perpetual debt.

The Associated Press reported Sunday that more than half (53.6 percent) of all four-year college graduates under 25 in the US are either unemployed or underemployed—that is, without a job or working at a job that does not require their degree. This is the highest percentage since records began being kept 11 years ago.

Of the 1.5 million people in this category, about half are unemployed and the other half are working for low wages at retail stores, coffee shops, restaurants, etc. The report also noted that only three of the 30 jobs with the largest projected number of openings in the next eight years will require a bachelor's degree or higher."

(there's more. It ends with this)

"There is no way to defend the rights of working people and youth—the right to a job, to an education, to a future without war—within the framework of the two big business parties and the capitalist system they defend. The fight for a future for young people is the fight for socialism."

[Michael Panzner]

George: Nah, nothing has really changed since I wrote the other ones! ;-)

[Dennis The Menace]

The economy is growing at a very slow rate. I am surprised that we are creating any jobs at all. In order to sustain job growth the economy must grow at about a 3% rate for a long period of time. otherwise the economy will stop creating new jobs. I bad sign of the dire condition that the job market is now in showed up in the the data concerning mexicans returning to mexico which show that more mexicans returned to mexico than came to the united states.