The United States Bureau of Labor Statistics reported a few days ago that the U.S. economy added 2.5 million jobs in May 2020. This hardly seems likely. As you can see from the graph above, over 8 million people filed for unemployment insurance during the four weeks of May. If the U.S. economy added a total of 2.5 million workers, that means more than 10.5+ million of the unemployed returned to their jobs since you would need to add the 8+ million to the 2.5 million to get 10.5+ million. 10.5 million people would have needed to get back to their jobs after the last 1.8 million filed for unemployment insurance during the last week of May. It looks like the government is saying roughly 10.5 million people returned to work on May 30th and May 31, which is possible, but hardly likely.
The official unemployment rate is 13.3 percent when the majority of economists expected it to be closer to 20 percent.
You got to wonder about the corruption going on in government to come out with these numbers, which look like a lie. Some experts wondered what could have caused this increase in jobs.
Bloomberg news reported that, “Michelle Meyer, head of U.S. economics at Bank of America Corp., pointed to the 1.4 million jobs added in the restaurant industry and said, “maybe this is an indication that PPP (Paycheck Protection Program) is working and it’s being distributed to small businesses — restaurants — and they’re using it to bring workers back.”
And maybe not.
“Another issue is that some workers are being counted on payrolls even if their hours or pay are minimal, said Betsey Stevenson, a University of Michigan economist who was the U.S. Labor Department’s chief economist in the wake of the 2007-2009 recession.
“The problem is that Wall Street is used to predicting job loss due to a typical recession, not one in which people are temporarily sent home en masse,” Stevenson said.”
While millions of people are heading back to work in the coming weeks, the damage to the economy is likely to last a while. Sometime in the late summer or early Autumn, we will have a real idea of how badly this recession is. Unemployment should go down from here, but it will still be abnormally high since we will be in a recession that began in March.
Expect the stock markets to continue upward as the economy stays mired in recession since the government authorized the Federal Reserve to give away (officially loan) some $6.6 trillion to the rich via their major corporations. Don’t expect the Fed to carry a lot of these loans on their books. (See The CoronaVirus Stimulus Bill: The Rich Get 5 Trillion, We Get Crumbs.)
It used to be that corporate profits drove the stock markets up, but for the last ten years it has largely been the Federal Reserve and the U.S. government and corruption that has done this. The Fed printed up and handed out $26 trillion to twelve banks to cover the losses the billionaires suffered in 2008-09 (See The $26 Trillion Bailout). The bankers withheld millions of houses off the market in a clear act of conspiracy in restraint of trade that the Obama Administration turned a blind eye to since their Wall Street benefactors were cashing in on the corruption (Click here for that story). Meanwhile, corporate profits peaked in 2014 and therefore clearly have not been pushing the stock market up during the last six years; corruption has been pushing the market up.
The United States continues to see government corruption at all levels rise. The U.S. saw it drop out of the top twenty least corrupt nations for 2019, and that most likely understates how corrupt the U.S. has become. This corruption is caused by income and wealth inequality. The rich want more for themselves and less for you and corruption is part of the cost of doing business and achieving their goals.