The Huffington Post is talking about Obama’s handling of the economy and the world view of his economic advisers now that Larry Summers is resigning.
Those policies — the bailout of Detroit automakers, an $814 billion stimulus package, subsequent programs under TARP, Cash for Clunkers and the administration’s unlimited backstop of Fannie Mae and Freddie Mac — arguably saved an economy that many considered to be on the verge of collapse.
But while the recession officially ended last year, it hasn’t for most American households. The unemployment rate has risen nearly two percentage points since Obama took office, Labor Department figures show. Private-sector job creation is anemic. Growth has stagnated. Incomes have barely risen. Unpaid debts are being written off. And household wealth is lower today than where it was last December, according to Federal Reserve data through June.
The story then goes on to point out:
Large banks and corporations, on the other hand, are thriving. Corporate profits have risen to pre-crisis levels, according to the Commerce Department. Company balance-sheets haven’t been this strong since 1956, Fed data show. Firms with access to the capital markets are taking advantage of record-low interest rates and refinancing expensive debt, and pocketing the difference. Last month, IBM sold three-year notes to investors, offering 1 percent interest. On Wednesday, Microsoft Corp. sold three-year notes at 0.875 percent interest to help fund share buybacks and increased dividends for shareholders. It’s reportedly the lowest interest ever offered by a company looking to sell three-year debt.
Everyone with even a modicum of economic training knows that unemployment is a lagging indicator! Given the rebound in health in corporate America, it bodes extremely well for our long-term economic health. Healthy companies, like Google, hire people. Unhealthy companies, like the old General Motors, lay off people.