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Improvement in Unemployment Rates, Says Wall Street Journal Marketwatch

By Joseph McDaniel, Esq.

Do you feel rich yet?

The Wall Street Journal has recently reported that some statistics for February show that unemployment is dropping and that some jobs, although not a lot, are being created.

I am reminded of the Great Depression: the Government announced on approximately 30 separate occasions that the Depression was over and that it was safe to go back to buying. And it was wrong, on about 29 of those occasions.

In fact, it took World War II to pull the United States out of the Great Depression, and that war found us entirely unready.

Now, will the current increase in jobs result in a reduction in bankruptcy filings in Arizona and the rest of the United States?

Probably not.

Low-paying jobs that replace high-paying jobs result in bankruptcy filings, whether they're Chapter 7 Cases, or 13s or 11s. And the reasons for that are obvious.

But what will happen next is simple, in any case; the other shoes will drop sometime soon, and people will act as though no one could possibly have anticipated that commercial real estate will tank because businesses can't afford last year's rates with this year's income.

And as inflation, initially driven by ever-increasing gasoline prices, continues into the stratosphere, we will see a continued economic meltdown.

And it doesn't need to be this way, and I wish it weren't this way, but I don't see any real light on the horizon. Until we have real and serious manufacturing in the United States again, which is what ultimately pulled us out of the Great Depression, the economy in the United States will continue to circle the drain.

And sometimes I want to be wrong, and this is one of them; but watch this space for developments. My current predictions are simple: no major improvements in the economy, more announcements that everything is better now, and a crash in commercial real estate, followed by high to hyper-inflation.

And sure, I have a worm's eye view of the economy, because I'm a bankruptcy lawyer in Phoenix, Arizona, but I don't see an improvement anytime soon.

p.s. probably the easiest short-term economic fix for the United States would be drilling for oil and digging for coal, while every other form of energy production is pursued like the Holy Grail, including nuclear power plants like those in Japan. And I'm certainly not opposed to solar or windmills or tide power, but getting those on line in a meaningful way in this lifetime is not so easy, apparently.

And the reason that starting to drill and dig is such a good idea is simple: the simple announcement of drilling and digging has the effect of dropping the prices of oil and gas, which is very, very good for people who need to drive to work. 

Full post as published by Arizona Bankruptcy Attorney Blog on March 04, 2011 (boomark / email).