The Coming Jobless Recovery

Updated: July 27, 2009

There's been a lot of talk in the media lately about an economic recovery. Homes sales are up, the stock market is up and the price of oil is down. Are the good times back?

Though the media made a big noise about the recent surge in homes sales in California, upon closer analysis most of the sales were in reality short sales - home owners forced into selling at deeply discounted prices by their mortgage holders.

Fed Chairman Bernanke has predicted that home prices have another 20% to fall before anything like a recovery can come to the real estate market. Those who buy homes now will regret it later. They may join all the others who own homes worth less than they owe on them.

Recent economic recoveries have been fueled by an increase in consumer spending but this time it's different. The consumer isn't buying. With prices falling why would anyone want to run out and buy something they don't immediately need?

No doubt President Obama will be talking recovery next spring as we enter the election season. You'll be hearing a lot of positive news about the economy but I'll tell you what you won't hear. You won't hear about new job creation.

This will be the mother of all jobless recoveries. Lots of increased corporate earnings. Lots of corporate mergers. But few if any new jobs.

Many of the top economists are now predicting that we won't see any action on the new job front for several more years. That's sad because job creation is the key factor for most people. The rest of it is just so much icing on the cake.

Also, the U.S. dollar is in serious trouble. It's falling in value and our creditors (chief amongst them China and Japan) are getting a bit concerned that we may not ever repay the mountain of debt we've accumulated.

So last week Treasury Secretary Geithner went on a world wide trip designed to calm the nerves of those we borrow from. Obama has also been saying reassuring things. Don't kid yourself - they're worried. A collapse in the dollar would cause the price of gasoline and food to more than double literally overnight. That would put downward pressure on the economy just when we need it least.

Survive and thrive during the coming bad times. Get the facts - there's no other book like it. Order today!

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