Unemployment rates over the last 60 years

[turbo36]

Let's try to not go political again - can we just discuss where we think the economy is headed over the next 2-3 years.? And what people are doing in anticipation?


This is a listing of the unemployment rate over the last 60 years.

The United States Unemployment Rate By Year

 

[jinjimbob]

That graph indicates, unemployment goes up with every president, then slowly goes down, until the next president, then up again.

I don't know if that is connected with you only get so many months of unemployment, so after 6 months, you aren't unemployed anymore.

 

[charlz]

A lot of the news about layoffs, unemployment etc. remind me of the early 80's. I was in high school then so that is about a far back as me economic memory goes

In the early 1990's I read a book called "The Great Reckoning: How the World Will Change in the Depression of the 1990's". They laid out a premise that in the past who the economic superpower was in the world was largely based upon projection of military power. Little things in history changed the balance of power. Until the invention of the stirrup peasants could knock a mounted knight off his horse so they held some power. Kings became more powerful with the stirrup as one knight could slay many peasants... up until the invention of gunpowder changed the balance again. That part alone was interesting.

What they boiled down to was that a some point military power would no longer dictate who the economic superpower was. At the time it looked like Japan was the up and comer. Now it looks more like China to me. Could it be they were just 15 years early with their prediction?

They based the transitions on 'the ages'... Britain was overtaken as a superpower by the United States with the Industrial Revolution. The US superpower position may be taken over by another country in the 'Information Age/Revolution'.

So, all that to say that the US could well be facing a period like Britain did as it declined from superpower status. British history may foretell a lot.

I'm going to have to go give that book a dusting and skim through it again

 

[JESSE1]

There's two big problems that will have to be faced: (1) the world population continues to increase and (2) technology is eliminating jobs. Where are all these people going to find work? Auto factories used to use human labor to assemble cars. Now robotics have eliminated jobs. When I went to work at my company 27 years ago we had 2800 employees. Now we're down to 1400 and producing more product. Technology has made the difference. Until the world population gets under control (that doesn't seem likely) there's going to be big problems.

 

[jsboening]

What they boiled down to was that a some point military power would no longer dictate who the economic superpower was. At the time it looked like Japan was the up and comer. Now it looks more like China to me. Could it be they were just 15 years early with their prediction?


I'm going to have to go give that book a dusting and skim through it again

I can remember back in the late 80's/early 90's, my Dad telling me how the Japanese would rule the world because of there economic might. He was pretty close just got the wrong country. CHINA! You just about nailed it dad.

If you ever bought anything Japanese you'd had better hide it from him. Or you would receive the lecture on how you wouldn't have a job some day. Now that I'm older, I see he was right about a lot of things.

 

[EddieWalker]

The problem that I have with the unemployment level is that there are more and more people who do not want to get a job. They have learned to play the system and I don't have to get a job. I sometimes wonder if the government does this on purpose. Keep as many sheep as possible under control with the threat of taking away their free money if they don't do as they are told.

I don't know this for a fact, but I belive it's true that if you look in any newspaper in the country, you will find a help wanted section with people paying advertising to try and find somebody to come work for them.

If you want a job, there are always allot of them out there. Most make an excuse as to why they can't get that job, but very few actually go out and apply for those jobs. Then there are others who have told me that they make more on unemloyment or whatever they are receiving then the job pays.

How many self employed people are included in those who say they are unemployed?

Eddie

 

[dmccarty]

Interesting chart.

I was curious about the average unemployment rate for those 61 years. The quick spreadsheet says the average was 5.6%. The site also has inflation for the same time period with an average of 3.83% which last year was 3.85%.

Last year we went passed the average to 5.76% Listening to the press over the last few years one would think it was much worse than it really was. Course we are on the uptick in unemployment and inflation so the question is how high will they go?

Since the numbers were in the spreadsheet I went and did a line graph overlaying the inflation and unemployment numbers. There are time when unemployment goes up and inflation goes down. The last time the two were unlinked looks like back in the 1950s. Since then the unemployment and inflation go hand in hand so inflation is about to go up.

Before looking at the inflation and unemployment in a graph we have been planning for a time of high inflation and interest rates. I wish they had the interest rates on the website since it would be interesting to put in the graph. But I think the interest rates will trend with inflation and unemployment.

There was a chart in the WSJ late last year that covered the ups and downs in the market. We seem to be in a bear market aka down turn. These last roughly 10-20 years. We might have another 2-5 years before the cycle up ticks again.

Given that Congress is about to spend a trillion dollars as a down payment in a stimulus aka pork spending spree I don't see how inflation is not going to go up drastically. Unless someone in Congress gets some sense, what are the chances of finding sense in Congress in enough numbers to stop this madness, we is going to get some higher prices. I would guess our grocery bill has gone up at least 20-30% over the last 4-6 months. Going to get worse I'm afraid.

To put a Trillion dollars in perspective if you equalize a dollar of today with a dollar in the 1940s, WWII cost FOUR trillion dollars. Congress is about to spend 25% of WWII and if you think they are done I have a bridge for you to buy. The states want another trillion. I guess spend a billion here, spend a billion there, and pretty soon you have spent some real money.

We sign off on our ReFi next week. It will remove our variable rate line of credit and give us a 4.5% 30 year mortgage.

Later,
Dan

 

[2manyrocks]

The OP asked a tough question. It appears to me that the downturn will deepen and broaden. With stocks down as much as they are already, would you hang on or sell?

 

[dmccarty]

The OP asked a tough question. It appears to me that the downturn will deepen and broaden. With stocks down as much as they are already, would you hang on or sell?

If you sell its a real loss. Right now they are paper losses.

Back in the early 90's down turn a particular stock was down under $50 when it had been up around $120ish. The stock value was less than the assets of the company. It was going to hard to loose money on the stock. I remember coworkers talking about selling the stock and getting out. The coworkers were married to each other. One wanted to sell while they other wanted hold. It made for interesting lunch conversations.

Long story short but at one point the stock went up in value at least %500. It split a couple of times after the down turn and has stayed between $80-120 a share. I had saved up $20,000 to pay off the first bit of land I owned. I really was torn between paying off debt or buying 20k worth of stock....

Since I don't like debt I paid of the land. If I had bought the stock I would have turned 20K into 100K. Instead I turned 20K into maybe 40K.

My 401K is buying stock right now. Its low priced. It will go up again. In hindsight I should have moved the current 401K investments from stock to something more secure. The money going into the 401K from the current paycheck would be buying cheap stock. For me its too late to sell but the 401K is buying.

Later,
Dan

 

[charlz]

Given that Congress is about to spend a trillion dollars as a down payment in a stimulus aka pork spending spree I don't see how inflation is not going to go up drastically. Unless someone in Congress gets some sense, what are the chances of finding sense in Congress in enough numbers to stop this madness, we is going to get some higher prices.

They are deathly afraid of deflation. Basically deflation is prices are going down... so consumers don't buy as 'it will be cheaper next week', in order to get people to buy stores have to slash prices, in order for stores to slash prices they need their suppliers to slash prices and so on and so on. Finally it gets to the raw material suppliers and the only way for him to slash prices is to lay off workers etc etc. With pay cuts for everybody along the way... but the dollar also starts to buy more as goods get cheaper.

I understand why deflation is viewed as a negative thing but it would seem that you can only have so much inflation before you need a 'correction' which would be a period of deflation.