(Roughly) Daily

Posts Tagged ‘recession

Never going to happen…

One might express the exceedingly low probability that one might agree (that, say, Adam Sandler is the artistic and comedic rival of Buster Keaton) in a variety of ways.  Here in the U.S., it might be “when pigs fly” or “when Hell freezes over”.  Now, thanks to the good folks at Nautilus, one can answer with the appropriately idiomatic expression of improbability all over the world.  Just click the image above…

###

As we substitute hyperbole for hyperventilation, we might recall that it was on this date in 2008 that Lehman Brothers filed for bankruptcy, setting off the worst financial crisis since the nineteen-thirties, a seven-hundred-billion-dollar bank bailout, and a painful recession.  On this dark anniversary, John Cassidy asks, “What Has Changed Since Lehman Failed?”  James Kwak answers, “5 Years Later, We’ve Learned Nothing From The Financial Crisis.  And for a really deep dive, leap in here.

Then-Secretary of the Treasury, Henry Paulson

Written by LW

September 15, 2013 at 1:01 am

And that’s the way it is…

source

Arguments rage as to how the U.S. sailed into the economic eddy in which we’re caught, and as to how we should navigate out.  (Your correspondent’s thoughts, FWIW, are littered among the postings in his other blog.)  But the situation is what it is…  a situation that the folks at ProPublica have profiled, current as to data available this month.

Some selections:

– Annual rate at which the GDP grew this year: 1.3 percent between April and June, 0.4 percent between January and March
– Average annual GDP growth from 1998-2007: 3.02 percent
– Total jobs lost since January 2008: 8.7 million
– Total jobs recovered since January 2008: 1.8 million
– Unemployment rate in July 2011: 9.1 percent
– The “natural unemployment rate”: 5 percent
– Months that the unemployment rate has been around 9 percent or more: 28
– Number of unemployed people in July 2011: 13.9 million
– Number of long-term unemployed people in June 2011: 6.3 million, or 44.4 percent of the unemployed
– Number of long-term unemployed people in July 2011: 6.2 million, still about 44.4 percent of the unemployed
– Years it will take to get back to an unemployment rate of 5 percent: four years if we’re adding jobs at 350,000 per month; 11 years if we’re adding jobs at the 2005 rate of 210,000 per month

More at ProPublica… In an economy the fundamental premise of which is consumption, and in which employment gains demand a GDP growth rate of over 2%, it’s a sobering picture.

As we contemplating re-stuffing our mattresses, we might recall that it was on this date in 1835 that the New York Sun began a series of six articles detailing the discovery of civilized life on the moon.  Now known as “The Great Moon Hoax,” the articles attributed the “discovery” to Sir John Herschel, the greatest living astronmer of the day.  Herschel was initially amused, wryly noting that his own real observations could never be as exciting.  But ultimately he tired of having to answer questioners who believed the story.  The series was not discovered to be a hoax for several weeks after its publication and, even then, the newspaper did not issue a retraction.

The “ruby amphitheater” on the Moon, per the New York Sun (source)

“…what remains after one has forgotten everything he learned at school.”*

A guest post from Scenarios and Strategy (here, with an almanac entry)…

The Bureau of Labor Statistics reminds us that it’s smart to stay in school:

But as Calculated Risk reports, while unemployment among the best educated is still lowest, it’s increased as much in percentage terms for them during this current recession as for any other group.

click to enlarge

One notes that all four groups** were slow to rebound after the 2001 recession– not an encouraging reminder if one is hoping for a brisk employment-led, consumption-fueled recovery this time around.

But in some ways more striking is a difference we might expect, but that hasn’t yet emerged.  Calculated Risk:

I’d expect the unemployment rate to fall faster for workers with higher levels of education, since their skills are more transferable, than for workers with less education. I’d also expect the unemployment rate for workers with lower levels of education to stay elevated longer in this “recovery” because there is no building boom this time. Just a guess and it isn’t happening so far … currently the unemployment rate for the highest educated group is still increasing.

Clearly, from an individual’s point-of-view, it’s still smarter to get more education than less.  But the perturbations of past periods remind us that the gearing between between academic degrees and financial success isn’t always perfectly tight…  Indeed, those with sharply-defined professional credentials in fields– e.g, finance– that are unlikely even in the intermediate term (if ever) to recover their bubble-fueled growth rates, may find their advanced degrees at best unhelpful; at worst, downright prejudicial.

Economic recovery and growth will be driven to some large extent by innovation; that innovation will create new– and new kinds of– jobs.  Looking even just five years out, much less ten, one has to admit that it’s just not possible to predict what these emergent jobs, nor their requirements, will be.  (Consider, e.g., the hottest topic– and job category– in marketing/advertising these days: “social media marketing”…  which wasn’t even a glimmer a decade ago, and was just being born five year ago.)  This is a challenge for those new to the work force, who have to wrangle the product of their schooling and their personal experience into a shape that can fit the entry-level positions they seek.  It is a much bigger challenge for those  mid-career who find themselves needy of making a move:  these more mature folks have not only to learn new fields, they also have to re-direct the considerable momentum of perception and habit that characterized their old– and they have to do those things, usually, in ways that justify salaries way north of entry-level.

All of which underlines for your correspondent the extraordinary value of a liberal arts education.  When one is faced with a “working adulthood” that is one transitional challenge after another, no skill is more valuable than the capacity to adapt.  And no capability is more central to that adaptation than the ability effectively and efficiently to learn.

This is precisely what, at its core, a liberal arts education is about:  learning to learn.

There are many, many other reasons, rooted in personal and societal benefits, to pursue a liberal arts education, and top support a strong foundation of liberal arts in higher education.  But the lessons of the last couple of years– indeed, of the last several decades– suggest that the economic rationale is plenty strong as well…

And besides, it’s fun.

* “Education is what remains after one has forgotten everything he learned in school.”
– Albert Einstein

** To put these cohorts into perspective, the Census Bureau suggests that, of these folks “25 yrs. and over” (in 2008):
– 13.4% had less than a high school diploma.
– 31.2% were high school graduates, no college.
– 26.0% had some college or associate degree.
– 29.4% had a college degree or higher.

UPDATE:  Reader JK directs our attention to another treatment of the data, in the NY Times. As he suggests, even more dramatic.

As we revisit our course catalogues, we might recall that it was on this date in 1933 that Congress passed the Emergency Banking Act, the first major legislative step in Franklin Delano Roosevelt’s New Deal  program.  The sense of urgency was sufficiently high– four days earlier Roosevelt had declared a “Banking Holiday,” closing all of the nation’s banks– that most legislators passed the Act without even reading the single copy that was available for review.  The EBA gave the government authority to shutter insolvent banks; that, coupled with the Federal Reserve’s informal-but-explicit pledge to guarantee the deposits of banks allowed to reopen (de facto deposit insurance), eased the crisis of public confidence:  within two weeks of banks’ re-opening on March 13, Americans had re-deposited over half the cash they’d withdrawn and hoarded through the period of bank failures that marked the first chapter of the Great Depression.  Later that year, the (more considered and embracing) Banking Act of 1933 replaced the EBA, and established such lasting practices and institutions as the FDIC.

Roosevelt signing the Emergency Banking Act

And now, the good news…

Eat Less, Live Longer…

The chart above (courtesy of the OECD, via Swivel) plots relative levels of unemployment against life span…  and suggests that there may be a silver lining in the dark cloud of recession: there’s evidence that life expectancy increases during times of high unemployment.

Specifically, this data shows the relationship between unemployment and life expectancy for the USA between 1960 and 2006. The following series are shown:

* LIGHTER PURPLE: residual life expectancy – the difference between the actual and expected life expectancy, in lay-terms, how much longer people lived than they were expected to
* DARKER PURPLE: unemployment % – the unemployment rate for the year

For another dose of encouragement, see this Freakonomics post… and relaaaaax…

As we denominate our blessings in something other than dollars, we might recall that on this date in 1956, Elvis Presley sang “Don’t Be Cruel” in the first of his three appearances on The Ed Sullivan Show

Reblog this post [with Zemanta]

Oh the shark has pretty teeth, dear / And he shows them pearly white…

George Burgess and a momento mori

Bank robberies, for sale signs, and store closings are up, even as the household wealth of the average America family is down by 40%– the economic crisis has, as one knows, had wide and deep effects.  But lest we think think that the downturn has had no positive impact, this, from the University of Florida and the Florida Museum of Natural History’s International Shark Attack File:

The recession may be responsible for a slump of a different sort: an unexpected dive in shark attacks, says a University of Florida researcher.

Shark attacks worldwide in 2008 dipped to their lowest level in five years, a sign that Americans may be forgoing vacation trips to the beach, said George Burgess, ichthyologist and director of the International Shark Attack File, which is housed at UF.

According to the latest statistics released today, the total number of shark attacks declined from 71 in 2007 to 59 in 2008, the fewest since 2003, when there were 57, said Burgess, who works at the Florida Museum of Natural History on the UF campus.

“I can’t help but think that contributing to that reduction may have been the reticence of some people to take holidays and go to the beach for economic reasons,” Burgess said.

Read the entire story here.

As we scan the surface for fins, we might recall that this is the anniversary of another traditional beneficiary of downturns: it was on this date in 1902 that “Talley’s Electric Theater,” the first American venue devoted exclusively to movies, opened in (of course) Los Angeles. The theater charged 10 cents for a one-reel show.

Thomas Talley’s Phonograph Parlor was opened in 1896 (this photo was taken in 1898); patrons could could see “moving pictures” through a device which flipped through a series of still photographs on cards.  Then, in 1902, he opened “The Electric Theater” in the back of the building.

Written by LW

April 5, 2009 at 1:01 am

%d bloggers like this: