Biotech Values

[turtlepower]

OT Roubini

I wouldn't be so dismissive of his predictions. While he may be too bearish this rally makes no sense. Moreover I disagree with most people that in this recession unemployment is a lagging indicator. In fact rising unemployment will exacerbate this crisis since it will lead to more foreclosures, more credit card defaults and less consumer spending. This is turn will lead to more losses at banks and therefore less lending leading to more job losses and the cycle continues. I agree with Krugman. There needs to be massive spending by the government to stem job losses. That's the only way out.

BTW if the 72000 census jobs were disregarded, the decline in non-farm payrolls would be 611,000 which would be slightly higher than estimates. I think the only reason this number wasn't higher was because inventories were low. Once inventories reach higher levels there will be more layoffs. Chrysler and probably GM bankruptcies will have consequences for job losses in the coming months. If federal spending doesn't lead to increased hiring soon this will all head down hill again. Also keep in mind that gas prices are increasing again and this will probably lead to decreased consumer spending and higher transportation costs than 3 months ago.