Greenspan: Unemployment Likely to Exceed 10%
According to this Bloomberg article, Greenspan Opposes New Stimulus Even With 10% Unemployed Likely, Alan Greenspan, the former Federal Reserve Chairman, believes that the federal government should not consider a new stimulus package even though the US unemployment rate is likely "to penetrate the 10 percent barrier and stay there for a while."
The article quotes Greenspan as saying "The focus has got to be on trying to get the economy going, but you also have to be careful that in trying to do too much you can actually be counterproductive" on ABC’s "This Week" program. Greenspan noted that only abouyt 40% of the $787B stimulus money has been spent thus far.
Regarding last week's unemployment report, the article quotes Greenspan as saying that the unemployment report was "pretty awful no matter how you looked at it." However, Greenspan still believes the economy is in the early stages of a recovery. Greenspan did raise concerns, though, about the number of people unemployed for 6 months or more. According to the September 2009 unemployment report, that figure is now at 5.44 million people, which is a 9% increase over August 2009. The result of these alarming figures is that more homeowners will default on their mortgages and short sales and foreclosures will increase.
If you are a homeowner in Middle Tennessee who has lost their job and cannot pay your mortgage and your home is worth less than your mortgage balance, please contact me to discuss selling your home via a short sale. I am a Middle Tennessee distressed real estate, short sale, pre-foreclosure (preforeclosure) and foreclosure expert and REALTOR. I serve real estate owners, homeowners and investment property owners in Rutherford County TN, Williamson County TN, Davidson County TN, Murfreesboro TN, Smyrna TN, La Vergne TN, Eagleville TN, Lascassas TN, Rockvale TN, Christiana TN, Brentwood TN, Franklin TN, Nashville TN and Belle Meade TN.
If you need to sell your home fast you can request help on my website JimTheRealEstateExpert.com.
Showing posts with label unemployment rates. Show all posts
Showing posts with label unemployment rates. Show all posts
Monday, October 5, 2009
Friday, October 2, 2009
Unemployment Rate Increases to 9.8% as Jobless Claims Come In Higher Than Expected
According to this New York Times article, Jobless Report Is Worse Than Expected; Rate Rises to 9.8%, the "American economy lost 263,000 jobs in September 2009, which was a lot more than was expected. As a result, the unemployment rate rose to 9.8%. This reduces the chances of the job market recovering by the end of 2009.
The US Labor Department raised concerns over huge government deficits coupled with high unemployment. The article stated "The numbers could intensify pressure on Congress to provide additional unemployment benefits and extend some programs that are set to expire toward the end of the year, such as tax credit for first-time homebuyers and health-insurance subsidies for people who lose their jobs."
According to the article, the government's stimulus efforts are not working to provide lasting employment. As an example, the article noted that state and local governments cut 47,000 jobs and auto dealerships (in the post "Cash for Clunkers" world) cut 7,100 jobs in September 2009. Also, the number of hours worked flattened and overtime hours declined in many industries. The article stated "while many businesses are making money again and seeing new orders trickle in, most are not ready to hire back the workers, even part-time. To economists, that suggests that unemployment could remain at historically high levels through next year, if not longer."
According to ean Baker, co-director of the Center for Economic and Policy Research, "People have been celebrating that we’re through the financial crisis, but the underlying issues are all still there. We’ve lost trillions of dollars in housing wealth, and consumption’s going to be weak. It’s not the ’30s, but there’s really nothing to boost the economy."
According to Andrew Stettner, deputy director of the National Employment Law Project, "This is still severe. It's not going to be turning around as fast as people want."
According to the article, there is a good chance that "other economic measures are beginning to waver, signaling that the initial phase of the recovery — a sharp rebound from a deep bottom — may be giving way to a long grind higher, marked by uncertainty and pain for many."
As I have been saying for quite some time now, this is only going to get worse. The problem was caused by too much debt. Now the economy needs to recede back down to a sustainable level not based on the high level of debt. The same goes for real estate - prices need to come down. All of this is going to result in more mortgage delinquencies, short sales and foreclosures.
If you are a homeowner in Middle Tennessee who cannot pay your mortgage and your home is worth less than the amount(s) you owe, please contact me to discuss selling your home via a short sale. I am a Middle Tennessee distressed real estate, short sale, pre-foreclosure (preforeclosure) and foreclosure expert and REALTOR.
The US Labor Department raised concerns over huge government deficits coupled with high unemployment. The article stated "The numbers could intensify pressure on Congress to provide additional unemployment benefits and extend some programs that are set to expire toward the end of the year, such as tax credit for first-time homebuyers and health-insurance subsidies for people who lose their jobs."
According to the article, the government's stimulus efforts are not working to provide lasting employment. As an example, the article noted that state and local governments cut 47,000 jobs and auto dealerships (in the post "Cash for Clunkers" world) cut 7,100 jobs in September 2009. Also, the number of hours worked flattened and overtime hours declined in many industries. The article stated "while many businesses are making money again and seeing new orders trickle in, most are not ready to hire back the workers, even part-time. To economists, that suggests that unemployment could remain at historically high levels through next year, if not longer."
According to ean Baker, co-director of the Center for Economic and Policy Research, "People have been celebrating that we’re through the financial crisis, but the underlying issues are all still there. We’ve lost trillions of dollars in housing wealth, and consumption’s going to be weak. It’s not the ’30s, but there’s really nothing to boost the economy."
According to Andrew Stettner, deputy director of the National Employment Law Project, "This is still severe. It's not going to be turning around as fast as people want."
According to the article, there is a good chance that "other economic measures are beginning to waver, signaling that the initial phase of the recovery — a sharp rebound from a deep bottom — may be giving way to a long grind higher, marked by uncertainty and pain for many."
As I have been saying for quite some time now, this is only going to get worse. The problem was caused by too much debt. Now the economy needs to recede back down to a sustainable level not based on the high level of debt. The same goes for real estate - prices need to come down. All of this is going to result in more mortgage delinquencies, short sales and foreclosures.
If you are a homeowner in Middle Tennessee who cannot pay your mortgage and your home is worth less than the amount(s) you owe, please contact me to discuss selling your home via a short sale. I am a Middle Tennessee distressed real estate, short sale, pre-foreclosure (preforeclosure) and foreclosure expert and REALTOR.
- Rutherford County Tennessee: Murfreesboro TN, Smyrna TN and La Vergne TN (LaVergne TN)
- Williamson County Tennessee: Brentwood TN and Franklin TN
- Davidson County Tennessee: Nashville TN and Belle Meade TN
Sunday, September 27, 2009
Nashville Business Journal: Greater Nashville unemployment hits 9.8%
According to this Nashville Business Journal article, Greater Nashville unemployment hits 9.8%, the Nashville Tennessee Metropolitan Unemployment Rate reached 9.8% in August 2009, which is up from 9.6% in July 2009. The article noted the following unemployment statistics for the following counties in the greater Nashville TN area:
Given that most of the counties in the greater Nashville Tennessee metropolitan area have unemployment rates of over 9%, with Rutherford County TN and Sumner County TN posting unemployment rates over 10%, there is no way that housing prices will increase. Also, there will continue to be high rates of foreclosures and short sales in Middle Tennessee.
- Davidson County TN Unemployment - The unemployment rate increased to 9.6% in August 2009, which is up from 9.2% in July 2009.
- Williamson County TN Unemployment - The unemployment rate decreased to 7.7% in August 2009, which is down from 8.3% in July 2009.
- Rutherford County TN Unemployment - The unemployment rate decreased to 10.1% in August 2009, which is down from 10.2% in July 2009.
- Wilson County TN Unemployment - The unemployment rate increased to 9.5% in August 2009, which is up from 9.1% in July 2009.
- Sumner County TN Unemployment - The unemployment rate increased to 10.3% in August 2009, which is up from 9.9% in July 2009.
Given that most of the counties in the greater Nashville Tennessee metropolitan area have unemployment rates of over 9%, with Rutherford County TN and Sumner County TN posting unemployment rates over 10%, there is no way that housing prices will increase. Also, there will continue to be high rates of foreclosures and short sales in Middle Tennessee.
Monday, September 21, 2009
Forecast Predicts Nashville Job Market Will Recover in 2012
According to this Nashville Business Journal article, Nashville predicted to recover in 2012, the Nashville metropolitan job market will return to pre-recession job levels in 2012 along with Memphis, Atlanta, Philadelphia, New Orleans, New York City, Boston and 12 other metropolitan areas. According to the article Austin and San Antonio in Texas will recover in 2010 and Dallas-Fort Worth and Houston and 6 other metropolitan areas will recover in 2011.
While all this sounds good, I am reasonably certain that it is not correct if by "pre-recession job levels" they are referring to the 4.5-5.5% unemployment rates that were the norm from 2004-2006. Those unemployment levels would certainly be welcome given that we now live in the era of 10%+ unemployment levels (10.8% for the state of TN in August 2009 according to the Tennessee Commissioner of Labor & Workforce Development James Neeley). Unfortunately, I cannot see how that can happen. The low unemployment rates of 2004-2006 were 70%+/- fueled by consumer spending that enabled businesses to sell products and services and, therefore, hire more employees. That consumer spending was enabled by cheap and easy to obtain debt (think HELOC's, credit cards, auto loans, personal loans, etc.). That debt is now largely gone, or at least significantly reduced.
Therefore, my problem with this article's rosy "pre-recession job levels" prediction is that it does not make sense. How can we return to "pre-recession job levels" if the consumer spending that created that low unemployment no longer exists? The answer is we can't and job levels will not return to "pre-recession job levels" for many, many years. I predict that unemployment rates will drop (i.e. the job market will improve), but the unemployment rates will stabilize at around 6.0-8.0%.
This will all negatively impact housing prices and ensure that foreclosures and short sales remain at relatively high levels for the next several years even after the job market recovers. Simply put, less people will be employed and, as a result, there will be less home buyers.
While all this sounds good, I am reasonably certain that it is not correct if by "pre-recession job levels" they are referring to the 4.5-5.5% unemployment rates that were the norm from 2004-2006. Those unemployment levels would certainly be welcome given that we now live in the era of 10%+ unemployment levels (10.8% for the state of TN in August 2009 according to the Tennessee Commissioner of Labor & Workforce Development James Neeley). Unfortunately, I cannot see how that can happen. The low unemployment rates of 2004-2006 were 70%+/- fueled by consumer spending that enabled businesses to sell products and services and, therefore, hire more employees. That consumer spending was enabled by cheap and easy to obtain debt (think HELOC's, credit cards, auto loans, personal loans, etc.). That debt is now largely gone, or at least significantly reduced.
Therefore, my problem with this article's rosy "pre-recession job levels" prediction is that it does not make sense. How can we return to "pre-recession job levels" if the consumer spending that created that low unemployment no longer exists? The answer is we can't and job levels will not return to "pre-recession job levels" for many, many years. I predict that unemployment rates will drop (i.e. the job market will improve), but the unemployment rates will stabilize at around 6.0-8.0%.
This will all negatively impact housing prices and ensure that foreclosures and short sales remain at relatively high levels for the next several years even after the job market recovers. Simply put, less people will be employed and, as a result, there will be less home buyers.
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