RUSH: You know, there’s unemployment news today. And I want to it read this to you.
This is from the Zero Hedge website, which we quote frequently on this program. The headline: “Initial Jobless Claims Plunge to 42-Year Lows, Despite Surging Job Cuts.” Now, that doesn’t make any sense. The number of people filing unemployment claims is at a 42-year low? Sorry. No, there has to be something else to make that true. That just can’t be. Then the second part of headline: “despite surging job cuts,” meaning layoffs are happening all over this country. People are losing their jobs left and right, and yet jobless claims are at a 42-year low?
Here’s how they explain this at Zero Hedge: “The yawning gap between job cuts (surging most since 2009) and initial jobless claims (hovering near 42 year lows) continues to grow as initial jobless claims collapse 7k this week to 255k – the lowest since 1973. Bear in mind, Goldman’s explanation that jobless claims are useless in this part of the business cycle … ‘this does not signal a booming labor market.’ But as Goldman Sachs confirms… ‘this does not represent a booming labor market.’ Although payroll employment growth has slowed in recent months, initial claims for unemployment insurance benefits remain very low.
“The four-week moving average of initial claims has trended lower again this year — despite meaningful layoffs in energy-producing states… Does this mean that the current rate of nonfarm payroll growth understates the strength of the labor market?” No. It’s the exact opposite. The bottom line is, I don’t care how you get there, and I don’t care what numbers they want to throw out there, this jobless claims number (people filing for unemployment compensation) does not factor in the people who have lost it after four years and are now off of the rolls in terms of being counted as looking for work.
So they’re not being counted as unemployed, which is how you end up with a 5.1% unemployment rate when 94 million Americans aren’t working. That’s the number: 94 million Americans are not working. People are losing their jobs. There is not an economic boom. There is not job creation going on. And this, too, is something the American people can sense. You know when the economy’s booming. You can’t miss it. You’re in the middle of it. You’re living it. Even if it’s not happening to you, you see it happening where you live.
You see it happening with people you know.
You’re getting new jobs or getting raises or the mall’s getting more crowded. Something. You see evidence of economic growth. By the same token, you see evidence of economic slowdown. Just yesterday… I didn’t have a chance to get to it. Maybe I do. Maybe I still have the… Yeah. “US Consumer Finally Losing the Will to Shop.” Wait a minute, now. How does this make sense? I mean, if we have this roaring economy, if we’ve got this booming recovery– which Obama and these Democrats love to tell us and the media loves to repeat it — then how do you get stories with all these layoffs and “US Consumer Finally Losing the Will to Shop”?
People don’t lose the will to shop!
You know, this is more idiocy. Shopping is being treated as a capitalist activity born of excess. “Shopping is a waste of time. Shopping is one of these evil by-products of a capitalist society where the distribution of wealth is so unfair that some people can shop and other people can’t.” So to be able to shop, in the modern vernacular, in the minds of American Democrats is a negative because not everybody can. “Shopping? The ability to go shopping? Why, that’s because of the inequalities of capitalism!”
So we have a headline: “US Consumer Finally Losing the Will to Shop.” Now, there’s a difference in shopping — well, there actually isn’t, but this is the point. Is it shopping when you go to the grocery store? You kind of have to go there, don’t you? Well, obviously it’s not as much fun, but what is “shopping” versus “buying”? My point here is the US consumer hasn’t lost the will to shop. The US consumer has less money to shop with is the point.
That’s what’s happening out there. There isn’t any… The will to shop is probably as strong as ever and probably stronger than normal because there’s less opportunity to do it. Ninety-four million Americans are not working. A lot of people live and subsist on EBD cards and food stamps and whatever, but they probably don’t have a lot of disposable income. So they don’t get to go out and shop. They’d probably love to. They don’t have the money to.
It’s a story in the Financial Times: “When the going gets tough, investors have grown used to betting on the tough going shopping. Every wobble of the past few years saw the consumer ignoring currency collapses in geopolitics and even government brushes with bankruptcy and instead heading for the mall. And the same has been true this year. While the best performing stocks in the US, the UK, and the euro zone are in the defensive consumer staples and the racier consumer discretionary sectors, almost no other sectors manage to make money.
“It’s not just the stock market that has relied on consumers. The world has been looking to the US to provide an economic lead, US and growth has come mainly from consumption. This, then, is not a good time for disappointing retail sales figures. Poor data on Wednesday suggested the US consumer might finally be losing the will to shop, with overrule sales growth below forecasts in sales.”
So these people think that you still have the money. “Oh, yeah, ’cause everybody’s working. We got a boom going on in employment, jobs and so forth. You’re just losing the will to shop,” and they’re worried, okay, you’re now hoarding your money, and they are worried why, because you spending your money is what has led the world out of the economic doldrums. Consumerism, when the Democrats aren’t criticizing that. So now you have lost your will to shop. The experts think that you’ve just lost the confidence, the desire. It doesn’t even occur to them that people have less disposable income with which to shop.
This is another one of these real-world circumstances that the elites seemingly do not see that just bewilders me. They must be telling themselves wherever they congregate — Washington, New York, Boston, wherever, and in London, they must be telling themselves that there isn’t any real problem in the economy. They’re doing okay. Everything where they live is fine. They see the number of 5.1% and they actually believe it. The disconnect here is profound, is my point. They don’t understand. I think it’s been a long time since the political class has been as woefully out of touch with the population of the country. I can’t remember it being any bigger.
RUSH: Okay. Now, want to dot the I, cross the T on this, because I have here in my formerly nicotine-stained fingers a big time story from the Pew people, Pew Research Center. Headline: “Wealth Inequality Has Widened Along Racial, Ethnic Lines Since End of Great Recession.”
Basically they claim the Great Recession ended about a year after Obama took office, and since that time, the inequality of wealth has widened along racial and ethnic lines. But that’s not the story. They bury the lead in their own story. The story that they don’t highlight here is how dramatically the drop in all income has been since Obama, 2007 to 2013. That’s the survey period. The inequality gap, I mean, the gap of wealth, ethnic and racial lines is there, but everybody has lost wealth.
In terms of median household net worth, every group, every quintile is down big time since Obama took office. And it’s in the chart here. Wealth by race and ethnicity 2007-2013. It’s in the chart. They don’t talk about it. No, in the story it’s all about how white median household net worth is $141,900. Hispanic median household net worth, $13,700. African-American median household net worth, $11,000.
So, to sum it up, the median white family income, 141 grand, Hispanic $13,700, blacks $11,000. The story, look at that inequality. Look at that. Whites are a fewer and fewer number and yet they’ve got all the money. That’s what you’re supposed to conclude from this. But if you read the whole thing, which nobody’s gonna do, which is why I’m telling you this, what the real story in this is how everybody is losing household net worth, how everybody is getting poorer.
Now, I’m not saying 141 grand is poor, but everybody’s losing income. Everybody’s losing net worth. Throw the top 1% out. We’re just talking average, ordinary, everyday Americans, which is who makes up the country. And that is the story. But they’re trying to make it look like, okay, so here we have the first African-American president, right? Historic. He was gonna be different, right? How does this happen? How does the median household net worth in white America, $142,000 a year. It’s 141.9. Whites 141.9, Hispanics 13.7, blacks 11. I mean, how does that happen? Why didn’t Obama fix that?
Don’t you think African-Americans and Hispanics, if they saw this story, would be asking, why isn’t Obama fix that? And I guess it’s a legitimate question if you think that’s what Obama was elected to do, if that’s why you wanted him to be president. The real story is that everybody in America is suffering, and the point is there isn’t a growing and burgeoning economy. There isn’t something roaring. There isn’t job creation whatsoever. That’s the reason I’m bringing this in to tie it in with the other two stories I’ve had here about the disconnect that exists between people in Washington and people in the rest of the country.