Thread: The Unemployment Rate in Perspective

The U.S. Labor Department announced Friday that the unemployment rate had risen to a 26-year high of 10.2% in October - an increase of 0.4 of a percentage point, even though the labor force contracted as well.

Good article, however there is one huge omission and that is how unemployment is calculated which makes a huge difference on the current unemployment numbers. That is how the numbers are calculated now and how they were calculated prior the Clinton administration. During the Clinton administration unemployment was calculated using the U8 numbers, since Clinton they are calculated using the U2 numbers which is not as accurate of a picture. We...

As productivity increases (which means we need fewer people to produce the things we consume), consumption too must increase to match the balance that existed. The balance as I like to call it is the 5-7% unemployment that we are comfortable with. Now, however, there is a fundamental shift that is occuring and that is that we have to get comfortable with 8-10% unemployment. This is until such time that we arrive at a new balance of...