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Thursday, November 13, 2008

Weekly Jobloss and GM

This was yet another grim jobs report.  From Bloomberg:

 

Initial jobless claims increased by 32,000 to a larger- than-forecast 516,000 in the week ended Nov. 8, from a revised 484,000 the prior week, the Labor Department said today in Washington. The total number of people on benefit rolls jumped to the highest level since 1983.

``The labor market is only reinforcing a very pessimistic picture,'' Linda Barrington, a labor economist at the Conference Board, said in a Bloomberg Television interview. ``When you start to see the downward pressure on wages as well as the credit crunch, that's only going to make consumers much more nervous.''

Now if GM were to declare bankruptcy, that would make the jobs number much worse.  But the short term gain would probably be worth the long term benefits.  If the government provides money, it is just extending the death by a few months.  Might as well not waste money and get over with it. 

After all, all three American companies did not innovate and just sold SUVs and other gas guzzlers with 0% financing.  Now, like everyone else, it's too easy to just blame the whole thing on credit crunch and not take the blame.

Like I said previously, I don't think the government will do the right thing.  It's easy for them to blow tax payer money away then take the medication.

 

 


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