The national news media keeps looking for signs of an economic recovery but it is doing a poor job reporting the reality of what it finds.
An example is the recent declines in "unemployment" claims.
Kansas City economist Bill Helming says the present standard and official U.S. unemployment rate of 8.1% for March of 2012 is misleading. The reality is the total number of people in the U.S. civilian labor force has been declining significantly since 2007-2008. The decline is more than three million people. Many have simply given up looking for a job and have, at least for now, left the U.S. civilian labor force.
According to the U.S. Bureau of Labor Statistics, a total of 169,000 people left the U.S. labor force in March of 2012 alone. The U.S. civilian labor force participation rate has declined from 67% in 2000 to 63% and 64% right now.
If we had the same U.S. labor force participation rate in 2012 that we had in 2007-2008, the standard unemployment rate in March of 2012 would have been at least 11%. The real rate of unemployment would have been 17%.
Helming expects during the second, third and fourth calendar quarters of 2012, the rate of unemployment will gradually increase and the number of people who file for unemployment claims will likely gradually increase between now and year end.
"I expect the U.S. unemployment situation to get significantly worse and for the unemployment rate to be significantly more elevated in 2013-2016 than will be the case in 2012," Helming adds.
This and other factors, especially the largely unnoticed debt crisis across private, corporate and government sectors, will keep the world's economy in turmoil, treading water at best, say Helming and a few other realistic economists.
The European debt crisis is getting worse, not better. The only thing that has occurred is the worst countries have been given more loans so they are deeper in debt. Small amounts have been written off and they've cinched up their belts one notch, leaving the real work yet to be done.
I also heard this morning that U.S. housing prices reportedly took a small uptick and that, also, was reported as a possible turnaround. This despite the fact we still had 1.4 million homes in the "foreclosure inventory," meaning they are in process in March of this year. More are filed each month and news ones enter that inventory. There have been more than 3.4 million homes foreclosed since September 2008.
These foreclosures represent billions of dollars in real estate values that have literally evaporated from the books of banks and mortgage companies. The reality is that markets rise and fall constantly, whether they are trending up or down. The fact is the real estate market is in a downtrend and all the fundamentals say it is unlikely that will change soon.
Like Helming and a few other realists I agree these problems have not been dealt with, even marginally, and I expect little real good news or significant uptrends in much of anything until all this gets wrung out. At best we will struggle along as we have been doing.