bank run blog

Amid the nervous chatter about green shoots and imminent recovery, it is difficult for anyone outside the deluded and lavishly subsidized financial sector or its laptop-wielding lapdogs in the business media to get too optimistic, as they are buffeted by reports of record foreclosures, record commercial bankruptcies, and, today, record unemployment.

The latest figures from the federal government put the national U3 rate at 9.4 percent, with the U6 at 16.4 percent. According to the Associated Press :

“The unemployment rate in the West jumped over 10 percent last month, the first time that regional threshold has been broken in about 25 years. On the state level, eight set record-highs and only two — Nebraska and Vermont — did not report increases.

The Labor Department reported Friday that 48 states and the District of Columbia saw employment conditions deteriorate last month. The fallout from the longest recession since World War II, was the worst in Michigan as automakers cut tens of thousands of jobs. Its unemployment rate rose to 14.1 percent.

The West region reported the highest jobless rate at 10.1 percent. The last time any region had a rate of at least 10 percent was September 1983, when the country was emerging from a severe recession.

The region is home to California, where the jobless rate jumped to a record 11.5 percent last month, Nevada, where it’s a record 11.3 percent, and other states that have been slammed when the housing boom went bust — snatching jobs and wealth.

The other six states that set new highs on records dating to 1976 were: North Carolina, Oregon, Rhode Island, South Carolina, Florida and Georgia.”

The situation is no longer confined to the Western region, or to the worst of the residential bubble states, as deteriorating fundamentals undermine the US economy in more serious and lasting ways than even during the 1930’s. CNN reports that thirteen states now have official unemployment rates above 10 percent :

“Several states and regions posted their highest unemployment rate since the report debuted in 1976.

Over the year, jobless rates were higher in all 50 states and the District of Columbia.

Michigan once again led the nation with a 14.1% jobless rate, up from 12.9% a month earlier, followed again by Oregon at 12.4%, up from 12% in April. Thirteen states have rates above 10%.”

Associated Press : Jobless rate in Western US tops 10 percent

CNN Money : Jobless rate rises in nearly all states

Bureau of Labor Statistics : The Employment Situation : May 2009

As politicians and financial gurus spin happy talk about the chimera of a recovery, and America’s ‘private banks’ cue up on the receiving end of the so-called public/private partnership offered by the Treasury Department, regular working Americans see something else on the horizon and prepare for a coming cataclysim, the Associated Press writes;

“From teachers to real estate agents, these budding emergency gurus say the dismal economy has made them prepare for financial collapse as if it were an oncoming Category 5 hurricane. They worry about rampant inflation, runs on banks, bare grocery shelves and widespread power failures that could make taps run dry.”

At least working America’s interest in end-times preparedness has created a bit of survivalist-bubble, the AP reports;

“The surge in interest in emergency stockpiling has been a bonanza for camping supply companies and military surplus vendors, some of whom report sales spikes of up to 50 percent. These companies usually cater to people preparing for earthquakes or hurricanes, but informal customer surveys now indicate the bump is from first-time shoppers who cite financial, not natural, disaster as their primary concern, they say.”

see story
Associated Press : Crisis spurs spike in ’suburban survivalists’

This year’s May Day protests across Europe were larger and more militant than last year’s, as the global depression marks its second year. Bloomberg reports :

“France’s eight labor unions joined for the first time for May Day demonstrations across the country to protest government measures on the economic crisis as insufficient and corporate leaders as out of touch.

Protests also took place today in Berlin, Athens and Istanbul. In Russia, tens of thousands of demonstrators for and against the government marched against a backdrop of rising unemployment and economic gloom, the Associated Press said.

‘Labor is changing; for the first time in perhaps decades, we are in agreement at the core,’ said Francois Chereque, secretary general of France’s biggest union, Confederation Francaise Democratique du Travail, in an RTL radio interview today. ‘There is a strong unity among the unions.’

Labor unrest is on the rise in France, as seen with ‘bossnappings,’ where workers hold company executives hostage to force negotiations on job cuts and plant closings, and demonstrations. In March, as many as 3 million people, or almost 5 percent of the population, marched in 213 protests. A January strike brought out 1.1 million people, according to police, and spurred President Nicolas Sarkozy to meet union leaders and offer more money in the country’s stimulus plan.”

Although the mainstream media shuns the European protests for the most part, May Day has in recent years become the occasion for massive immigrants’ rights marches in the US. According to the Associated Press :

“Thousands of immigrants and their families marched in cities from coast to coast, hoping to channel the political muscle Hispanics flexed last fall as President Barack Obama won election. This time, they hoped to jump-start an old cause: forging a path to citizenship for the estimated 12 million illegal immigrants living in the U.S.

Crowds were dampened in many areas though, as the swine flu scare kept numerous people home Friday. The area hardest hit by the swine flu is Mexico, also the native home of many rally participants.”

Bloomberg : French Unions Lead May Day Protests, Europe Marches

New York Times : Anger and Fear Fuel May Day Europe Protests

Associated Press : Immigrants push for reforms at rallies nationwide

Just as the efforts of the US government to address the economic crisis have been inappropriately fixated on Wall Street investors to the detriment of the broader populace, so too has the coverage of the problem been overly focused on the plight of relatively comfortable Americans and Europeans, even as the disastrous policies of our financial speculators reverberate tragically throughout the developing world. This evening the Associated Press reports :

“The World Bank on Sunday urged donor nations to speed up delivery of the money they’ve already pledged — and to give even more — to help poor countries weather the steep global recession.

The bank said developing countries face especially serious consequences as the financial and economic crisis turns into what it described as a ‘human and development calamity.’

In a communique, the World Bank’s policy steering committee said the crisis has already driven more than 50 million people into extreme poverty, particularly women and children. ‘We must alleviate its impact on developing countries and facilitate their contribution to global recovery,’ the committee said.”

The AFP is reporting that Chinese officials could not resist another opportunity to poke fun at the US, even in the midst of a humanitarian crisis :

“Meanwhile, China called for reform of the global currency system, dominated by the dollar, which it said is the root cause of the crisis.

Chinese Vice Finance Minister Li Yong said the ‘flawed’ international monetary system is ‘a major defect in the current international economic governance structure.’”

Associated Press : World Bank: Nations should speed aid to poor

Agence France-Presse : World Bank, IMF say crisis becoming ‘human calamity’

It was only 100 short days ago that an affable, well-intentioned young lawyer from the big city moved into the rambling old house with his elegant wife, who immediately set about planting a garden.

They’ve received lots of advice from some of the more experienced locals, who assure them that pretty soon they can expect to see green shoots all over the place.



To curb the excesses of the past, they have enlisted the aid of altruistic career civil servants.



In a related story, Chief White House Economic Advisor Lawrence Summers today pointed to a bustling, colorful tent city in rural Appalachia as an example of the kind of “green shoots” of economic activity that will characterize the nation’s recovery.

Summers and his entourage got lost on their way to a photo opportunity in Hooterville, and were mistakenly directed to one of many local Hoovervilles by their OnStar GPS navigation systems.



Summers praised the resourcefulness of the settlers in what he called the “flexible housing development” before moving on to speak at a luncheon for a banker’s association in Mount Pilot.

New York Times : World Finance Leaders Meet, and Cautiously Glimpse ‘Green Shoots’ of Recovery

Economic Times : More ‘green shoots’ keep Wall Street upbeat

New York Times : Cities Deal With a Surge in Shantytowns