Obviously the jobs number out last week was positive, although I wouldn’t read too far into it.

You’d expect jobless claims to decrease this time of year due to seasonal employment. How many seasonal jobs are there? No one knows, but hopefully this data will tide us over until the economy starts swinging to the upside.

Economics Economics, employment, jobs, seasonal employment

Since I’m a firm believer that history repeats itself, I got to wondering how things turned out in the past for economies facing our current challenges.

Fortunately, I didn’t have to go too far back in time to find out.  I did, however, have to go overseas.

The Greeks are in much the same boat we are in the States, although their ship has taken on a bit more water.

The Greek government has pushed social welfare programs that they can’t seem to find the funds for.  The budget deficit will be more than 12% of GDP this year, and the elected officials campaigned on extra spending, yet they now find themselves having to cut costs dramatically just to keep their head above water.

And to say the EU is a bit peeved is an understatement.

Since Greece is on the Euro, they really don’t have the ability to print money like the U.S. does.  The European Central Bank is suggesting that the Greeks, among other European countries, are on the verge losing their credibility, adding that it could stall the recovery process.

The rest of the countries on the Euro will be on the hook to bail out Greece or cut them loose from the currency all together (a rather unsettling proposition).  If the Germans, French and English will be forced to bail out Greece, you can bet it will be with some very unfavorable terms.  Screw me once, shame on you, screw me twice…

The total national debt in Greece is expected to increase from 99% of GDP to 135% by 2011 without significant cuts in spending. Compare this to a ratio of 90% for the U.S. and rising to over 101% by 2011.

The elected George Papandreou instituted a pay freeze for state workers earning more than  €2,000 a month which did nothing but cause an uproar within the Hellenic Socialists party.

The U.S. has some eerily similar financial stats as compared to Greece.  The one thing we can do that they can’t is print money and expect the general population to underwrite the transaction.

I suspect the underwriters of the U.S. national debt will not be happy.  Just ask the French… and Germans… and English…

Economics, Finance debt, Economics, Greece, national debt

There’s a giant billboard on the side of the interstate that I drive by several times a week, advertising for a local car dealership.  The premise of their advertisement is that they sell affordable new cars and trucks.  At first I didn’t think much of their pitch, but now I’m starting to hear that term, affordable, pop up on television and in the newspaper.

Affordable.  Isn’t that a relative term?

You see, I always thought it was up to me to determine what I can afford, and what I can’t.  I never imagined that someone else could have the insight to tell me I could afford their products.

I may be able to afford a $20,000 new car, but my next door neighbor may only be able to afford a $10,00o version.  In effect, it’s all relative to our own financial situation; earning power, savings, cash flow, investments, job security…  All of that influences what each of us can afford to pay for a product.

“Affordable” health care.  Another example.

On a daily basis, there is some talking head on T.V. telling us we need “affordable” health care for everyone.  The Obama administration has even taken that effort up as a primary goal for his first term.  But what does “affordable” health care really mean?

I may have the extra income to facilitate paying $300 per month for health care, but my neighbor may not.  Maybe he only has an extra $100 he can part with on a monthly basis.  Or to an even greater extreme, maybe he doesn’t have any extra money to shell out for health care.  So affordable to me is not affordable to him.

So really, to make health care affordable to everyone in our country, it has to be free to everyone in our country.  And isn’t that socialism? Sounds like it.

In our capitalistic economy, it is up to the consumer to tell the supplier what is “affordable” and what isn’t.  Everyday Joe’s will tell car dealerships with 500 copies of a cheap sports car that they can’t afford a $50,000 sports car in this economy.  They may tell that same dealership they can afford a  $15,000 sedan that gets good gas mileage and is built well.  The dealership will adjust inventory accordingly.

So let’s get this out there in the clear right now.  No one tells me what is affordable and what isn’t; affordability is the most relative of terms.

Economics Economics, health care