I'd like to welcome our newest partner on Market Open Live, WallStreetSurvivor.com. Wall Street Survivor is a trading simulation site that allows you to create and track a virtual stock and options portfolio. Mark Brookshire, President and Founder, joined me for a couple segments on the show this morning. We talked about a few of the popular traders at WallStreetSurvivor, including GoMaxGo. Click below to listen!Click below to listen!
The government is facing some big challenges these days, with the Health Care initiative still in jeopardy, the economy still fragile and an epidemic like housing situation. Yet, the biggest problem facing the Administration right now is the job situation.
It should be clear by now that everything else we are facing as a nation is pegged to whether or not enough people are working. Even though the stock market is trying to shrug off mostly negative reports, the one that requires the most attention is the jobs report coming out this Friday.
You can expect the most optimistic pundits to peg any increase in unemployment to lousy weather, and while there might be something to that, it still doesn't begin to explain why there are still so many people out of work. And, to those who think the economy can grow with 10 percent of the work force sitting on the sidelines, all I can say is, good luck.
We saw from last week's Consumer Confidence report that Americans are shaken. And, we saw from yesterday's Personal Income and Spending data that incomes are down, so for the group of people who still have jobs, buying power has lessened.
So, we're not likely to advance in any meaningful way unless more people are put to work, and there is little evidence that corporate America is ready to welcome back the millions of workers who have been displaced the past few years. This is why getting people back to work must be the number one government priority, with nothing else even a close second.
I've been fairly supportive of Fed Chairman Ben Bernanke because I think he's done as good a job as could be expected given everything that has been thrown at him the past few years. He seems to have gotten much better at facing legislators, where he was somewhat shaky early on.
However, during his testimony on the Hill yesterday he was predicting that the US unemployment rate would be between 6-7% by 2011. Huh? Unless I'm missing something, I can't even imagine getting close to 6% in a year's time. In fact, when the jobless claims were released this Thursday morning, it showed an increase in claims, not a decrease. And, I've seen very little evidence that corporate America is starting to hire more people.
I've often been suspicious of many of the government's economic numbers, and in fact, it really irks me when numbers are released and they show revisions that are sometimes way off of the original figures. It makes me think that they want to show things in a more positive light when in fact things are not as good as they make them look. So, please don't blame me when I find it hard to believe we'll be looking at an unemployment rate in the 6's a year from now.
In fact, I must not be the only thinking this way. If the market actually believed Bernanke's forecast, we would likely have seen a big boost to the upside, but this has not been the case. Try to keep it real, Ben.
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