by Michael
How would you’re feeling if one million Americans lost their jobs? Would you concentrate on that to be a fairly catastrophic event for the economy? Well, as you will note below, even the Federal Reserve is projecting that greater than one million Americans could lose their jobs within the months ahead. Pointless to say, Fed projections are often wildly optimistic. So what is going to the actual number be? Ultimately, I feel that things are going to be far worse than many of the experts would dare to assume right away. In keeping with Challenger, Gray & Christmas, the variety of layoffs throughout the first three months of this yr was 396 percent higher than the variety of layoffs throughout the same period in 2022. An amazing amount of negative momentum has been increase, and there may be a complete lot of fear on the market.
Fear of what could occur to PacWest drove their stock price 22 percent lower on Thursday. Overall, PacWest is now down near 80 percent to this point in 2023…
Shares of PacWest were under pressure once more Thursday after the struggling regional bank said that deposit outflows resumed in the primary week of May.
The stock dropped 22.7%, further extending its recent declines. PacWest’s shares have now fallen greater than 50% this month and nearly 80% for the yr.
The one reason why PacWest’s stock price is falling so rapidly is since it is getting lots of media attention.
For those who look closely on the numbers, PacWest really isn’t that much different from a whole lot of other regional banks which might be essentially insolvent at this point.
As I keep telling my readers, when banks get into trouble they begin getting really tight with their money, and that is already happening everywhere in the country…
It was already difficult for businesses and households to borrow money earlier this yr — but after the collapse of three US regional banks and a cascade of rate hikes by the Federal Reserve, getting money has develop into somewhat harder.
More lenders have stiffened their standards within the wake of accelerating turmoil throughout the banking sector, in line with the Federal Reserve’s quarterly Senior Loan Officer Opinion Survey (SLOOS) released Monday.
Survey respondents attributed the changes in lending standards to economic uncertainty, a reduced appetite for risk, deterioration in collateral values and broader concerns about banks’ funding costs and liquidity positions, in line with the Fed report. Moreover, lenders reported that they expect to tighten standards across all loan categories for the rest of this yr, citing the above concerns in addition to customer withdrawals.
If businesses and consumers have access to less credit, economic activity will decelerate.
And as economic activity slows down, more businesses will get into trouble or fail completely.
And that’s going to mean more layoffs.
In reality, initial claims for unemployment advantages just jumped to the best level in nearly two years…
The variety of Americans filing for unemployment advantages last week jumped to the best level since 2021, the most recent sign the historically tight labor market is cooling off within the face of rising rates of interest.
Figures released Thursday by the Labor Department show initial claims for the week ended May 6 surged by 22,000 to 264,000, well above the 2019 pre-pandemic average of 218,000 claims. It marks the steepest level for jobless claims since October 2021.
This was a really sharp rise.
In keeping with Zero Hedge, it was actually “a 4-sigma miss to expectations”…
The print was a 4-sigma miss to expectations, and was above the best forecast made by the 45 economists participating within the survey.
Ouch.
But that is just the start.
In keeping with Fox Business, if current Fed projections are accurate greater than one million Americans will soon lose their jobs…
Probably the most recent projections from the Fed show that officials expect unemployment to rise to 4.6% by the tip of next yr, up from the present rate of three.5%.
That might mean greater than 1 million Americans lose their jobs between now and the tip of the yr.
In fact lots of us don’t consider that the Fed’s projections will likely be accurate.
Personally, I expect to see absolutely massive job losses over the subsequent couple of years.
And because the economy steadily deteriorates, the condition of our society will get even worse than it’s right away.
For lots of you, that could be hard to consider, because things have already deteriorated quite dramatically.
In San Francisco and other cities across the nation, organized retail looting now happens on an industrial scale. For instance, just try what is happening at a Goal near San Francisco’s Union Square…
“I’d say 10 thefts a day,” said one employee on the Goal contained in the Metreon, a mall near San Francisco’s Union Square. The employee spoke on the condition of anonymity because they didn’t have permission from a supervisor to talk over with the press.
“Every 10 minutes you see it,” one other employee said who also didn’t want to be named. “Look in some corner of the shop, and also you’ll see people shoveling stuff right into a bag—food, cosmetics.”
We’ve got never seen anything like this before, and for this reason countless businesses have already left town.
One other employee that was interviewed noted that lipstick and nail polish had just been stocked that morning “and now they’re empty”…
A 3rd employee who also spoke on the condition they not be named said lipstick and nail polish, which will not be locked behind plastic, are recurrently stolen in handfuls.
“They were stocked this morning, and now they’re empty,” the employee said, pointing to an empty shelf reserved for lipstick.
One other employee said food and diapers are commonly stolen.
If that is how Americans are behaving now, while economic conditions are still at the very least somewhat stable, how will they behave once we are within the midst of a full-blown economic nightmare?
Our relatively strong economy has been the one thing that has kept our nation from descending into complete and utter chaos.
Once our economic strength is crippled, things are going to get really frightening.
So allow us to hope for the most effective, but allow us to also get prepared for the worst.
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