Slow economy growth will likely keep U.S. unemployment high

Hope and Change is now 'Moving Forward'. Nice.

WASHINGTON — High unemployment isn't going away — not as long as the economy grows as slowly as it did in the April-June quarter.

Weak consumer spending held growth to an annual rate of just 1.5 percent, even less than the 2 percent rate in the first quarter. And few expect the economy to accelerate in the second half of the year as Europe's financial woes and a U.S. budget crisis restrain businesses and consumers.
The growth estimate Friday from the Commerce Department suggested that the U.S. economy could be at risk of stalling three years after the recession ended. Economists generally say even 2 percent annual growth would add only about 90,000 jobs a month. That's too few to drive down the unemployment rate, which is stuck at 8.2 percent.

"The main takeaway from today's report, the specifics aside, is that the U.S. economy is barely growing," said Dan Greenhaus, chief economic strategist at BTIG LLC. "It's no wonder the unemployment rate cannot move lower."

Sal Guatieri, senior economist at BMO Capital Markets, expects the unemployment rate to end this year — and next year — at 8.3 percent. He said he foresees no decline in unemployment because of how tepid he thinks economic growth will remain: 2.2 percent for all of 2012 and 2 percent for 2013.
Some economic data improved over the course of the April-June quarter, while others worsened. Hiring, for example, rose slightly from April to May to June. But home sales weakened.

Stocks rose as investors shrugged off the sluggish U.S growth and focused instead on pledges from European leaders to preserve the union of the 17 countries that use the euro. The Dow Jones industrial average jumped more than 200 points in late-afternoon trading. Broader indexes also gained.

The lackluster economy is raising pressure on President Barack Obama in his re-election fight with Mitt Romney, the presumptive Republican presidential nominee. But few think the Fed, the White House or Congress can or will do anything soon that might rejuvenate the economy quickly. Many lawmakers, for example, refuse to increase federal spending in light of historically large budget deficits.

No president since Franklin D. Roosevelt, in the depths of the Great Depression, has been re-elected when the unemployment rate exceeded 8 percent. Presidents Jimmy Carter and George H.W. Bush were ousted when unemployment was well below 8 percent.

Polls show that management of the economy is the only issue on which those surveyed express more confidence in Romney, with his business background, than Obama.
Glenn Hubbard, economic adviser for Romney, said Friday's report largely matched economists' expectations.

"But those expectations themselves and the report itself were actually quite disappointing," Hubbard said. "At that pattern, the economy simply will never return to full employment."
Alan Krueger, chairman of the White House Council of Economic Advisers, noted that the report showed the economy grew for the 12th straight quarter. Still, Congress could strengthen growth and job creation by adopting Obama's plan to extend expiring tax cuts for all except the wealthiest Americans, Krueger said. Republicans want the tax cuts extended for all Americans.

YAY! :lisag:

the u.s economy remains fragile, no one disagrees

but the economic pace in europe doesn't help revive the u.s economy either,

in my opinion, americans would be smart to expect 'slow and steady' and invest for the future ... rather than expect a 180 turnaround w/ a republican presidency (that is, after all, baseless).

its a damn shame how Obama has destroyed the middle class...

this

Welcome to the world you helped create Obama Voter!!

If Obama loved this country he'd admit he failed and do what he said he'd do 4 years ago......step aside

No, an immediate turnaround shouldn't be expected by anyone but, as the chart that Mike posted shows, this is the worst post-recession recovery we have seen in our lifetimes.

What's more, the only ones that are pushing this "slow and steady" expectation are Obama and his cronies - according to them adding 50K jobs is "heading in the right direction." Well, if my car breaks down and I start to push it to the nearest gas station I don't take comfort when I'm leaning on the bumper that I'm "heading in the right direction." Obama's policies have failed and he is running on more of the same with 8% unemployment as some sort of new normal. That should be entirely unacceptable to everyone.

Very true - but I guess he's not done "fundamentally transforming the United States of America." There's still a lot of people who are doing pretty well financially who need to be dragged down into the mire and convinced to go on the government dole.

From the worst recession seen in our lifetimes..

there are no easy fixes,
interest rates are already at or near zero in the united states
lower taxes? numerous u.s major cities / states are already on thin ice ... basically bankrupt.
if taxes are lowered, there is no guarantee that companies will hire more or spend more (it appears that companies have been reluctant to spend even following good business).
in any direction and for any change, even change for the better, there are lobbyist fighting and applying influence.

tell me exactly how romney will turn things around (as he's promising, but not offering details)...

Based on what, specifically?

I'm not expecting Romney to spearhead the recovery - the Conservatives in the House will have to lead on this. Pass the Ryan budget, move forward with serious tax reform and gut federal regulations. That's a good start.

movement in any direction will face strong opposition from influential lobbyist; even good directions cannot go forward because savings for one is a lost for another ... so little to no progress is made.
and, which federal regulations are worthy of gutting? food standards / safety, or economic regulations? this will only create a vacuum, which is an opportunity for companies to exploit and profit from the public.

subtle changes can be made with an effort, whether this is enough for any president to steer an economy remains questionable. theres a lot of luck involved, frankly.

with the united states having such a fragile economy and slow progress, i'd be very wary of someone claiming to be an expert and having any type of quick solution.

consider the implications of any minor adjustment having a negative effect on a fragile economy.

Really ?? there have been 10's of thousands of pages of new regulations added in the last 3 years...somehow we existed and prospered before them... I'm pretty certain that we can exist and prosper in the future without them. And its beyond ignorant to think that: A) any regulation is a good regulation...and B) most regulations are food standard/safety related.

explain why its beyond ignorant, and (a) any regulation is good, and (b) most food safety regulation isn't necessary

The simple fact that a government writes a new regulation does not mean it is good, needed, or will not do more harm than good. And usually an effort to reduce regulation is met with the 'well you don't want food safety' nonsense...when 1 has really nothing to do with the other. Some food safety regulation is certainly not necessary, some may be. Is your position that all regulation is necessary..simply because it comes from the government ? that is beyond ignorant.

Ohh, and how did we ever exist before all these new regulations ?? Were millions dying because of a lack of these new regulations ?

Everything you've been whining about the past 3+ years..


It's certainly the worst I've experienced in my 34 years..

That ended more than three years ago.....why does everything still suck for the middle class? Huh?

Strange that you would say this, "being wary of someone offering quick solutions" yet you just did that 3 years ago

hope and change......

Well, Obama did say that it would be a long, slow, arduous process.

That being said, nothing has changed, and by that, I don't just mean the economy.

If you think Romney will be any different, well....can I have some of what you're smoking?

your problems are your own,

i don't participate in your nations democracy.

following gw bush's act and proposed leadership of mccain & palin, would you truly expect an improvement of any regard today?

Actually he said that if he didn't have this fixed in 3 years, it would be a 1 term proposition...and his estimates were that U/E would be at 5.6 if only his stimulus would pass.