9.09 & 40% UNEMPLOYMENT IS HERE!!!!!!!!!!!!!!!!!!!!!!!!!
Nobody said the world is coming to an end...America is just broke.
We are running a $2 Trillion dollar deficit.....and much of that is being used to prop up the economy.
We use that $2 Trillion to support 100,000,000 Americans on Welfare, Medicare, Unemployment, Food Stamps etc.....without that defict, many have no alternative source of income.
Then there are the 40-50,000 million Americans who work directly for the government or indirectly....they too depend on that $2 Trillion dollar deficit to for income.
Adding it up, about half the population depends on Government spending for income....and Government can't afford to pay them.
The $2 Trillion dollar problem is a cash flow issue and not balance sheet....that means just to sustain things just the way they are, we must come up with $2 Trillion dollars each year...year after year.
But as layoffs continue, commercial real estate prices crash, business shut down, the tax receipts to government will continue evaporating.
Evaporating tax receipts are the key....because that means the GAP gets wider and wider and wider...and the more the government cuts....the lower tax receipts go creating a vicious cycle of cutting causing slowing and slowing causing cutting.
Again, it is not the end of the world...but there is no doubt we are broke and nobody has enough money to fill the gap.
If we continue down the same road, banks will tighen further, interest rates will rise and commercial real estate will evaporate in value as tenants will fail and vacate quicker than you will know what happened.
Some think that a 16% unemployment rate is high...but if you add in all those who are not working and on the the government dole...we are now closer to 40%....simply an unsustainable number.
And the strange part is the cutting has really just begun:
Bing said the DDOT cuts will be part of an overall 10% reduction in the city’s workforce he must make to keep the city afloat.
Bing said he will announce the changes Sept. 10, and they will go into effect Sept. 26. Last week, Bing backed off making cuts to DDOT and recalled 113 bus driver layoff notices after Detroiters protested during four days of public hearings.
“These are not going to be temporary layoffs — I’ve got to reduce the workforce in the city of Detroit,” Bing said. “We can’t afford to carry 13,000 employees. We don’t have the money to do that.”