2.4 Million Job Openings for 15.3 Million Unemployed: How Average Americans don’t Partake in the Current Casino Stock Market Rally. Most of Net Worth is Stored in Housing but not for the top 10 Percent.
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For the most recent job opening data, according to the JOLT survey by the BLS, there were 2.4 million job openings in November of 2009. Now this might seem like a large number but it is not. Consider the fact that we have 15.3 million Americans that are still officially labeled as unemployed. And this is probably one of the main issues in this recession now. Even though massive layoffs have seemed to stop, it would appear that even less people are hiring today than back in March when the economy was falling into the economic abyss. What we can garner right now is the banking sector with record profits is now able to milk American workers even more since one of the biggest line items is labor and many companies are chopping this high cost item down.
This is rather obvious when we look at the actual job opening rate from the start of the recession:
The pattern is unmistakable. Fewer and fewer jobs are to be had while more and more Americans are looking for work. This is happening right in line with the bursting housing bubble where many Americans stored the bulk of their wealth. Yet Wall Street somehow thinks that a rising stock market is enough to resolve the issues on Main Street. Of course Americans are seeing a very different economy than say the investment banks residing on Wall Street. Even if we chart the incredible S&P 500 rally since March with monthly job cuts, the data is stunning:
While the stock market is now up close to 70 percent we have seen an additional 2.7 million job cuts since that time (or basically the entire pool of job openings). Is it any wonder why so many Americans are completely outraged at Wall Street and the banking system that is largely responsible for this current mess? Even during this bubble decade where stock markets peaked the typical American household saw less of their net worth aggregated in stocks:
At the same time, more and more Americans started relying on the housing bubble and counting home equity as the largest portion of their net worth. But with the housing market imploding, the largest line item of wealth has taken a major hit for most Americans. And just do the math, a 70 percent increase on a home valued at $200,000 is much bigger than say a 70 percent increase in a stock portfolio of $20,000. And that is the crux of the problem. The housing market has completely collapsed shattering the number one asset of Americans while banks continue to increase their stock wealth at the expense of typical Americans. Take a look at where Americans hold their wealth:
Non-financial assets makeup 66 percent of the asset column of American families (with real estate making up nearly 60 percent of this amount). The banking syndicate is satisfied right now because they are back to gambling in the stock market while the real economy continues to fall deeper into disrepair. And this makes absolute sense. Investment banks only exists to garner profits even if it hurts the economy. There is nothing wrong with earning a profit on your dime but right now, the American public is subsidizing billions in bonuses for what? Because employment is still imploding? What has the too big to fail banking system done for the average American? And here’s the big kicker, lower to middle income people, the vast majority of the population have the significant portion of their wealth in real estate (no 70 percent rally there). In fact, the percentile numbers are startling:
“For over 90 percent of the population home value makes up over 40 percent of all total asset worth.”
Yet once you reach the higher chamber of the economy, stocks suddenly become the vehicle of choice. So you can see why Americans aren’t buying this “stock market” recovery because many aren’t even participating in it. Actually they are through bailouts but they are getting nothing in return. The system is inherently flawed and more and more people are waking up to this reality.
If you really parse the data, sure it was a lost decade for over 80 percent of the population but someone made out this decade:
People don’t like bringing up class in the U.S. because they believe in this pull yourself up from your bootstraps myth. But banks don’t need to pull themselves up because they have the American taxpayer to yank them out of any bad bet and recover them fully. Their shoelaces are tied like an albatross around the middle class American. Those that work and earn money from an actual paycheck saw little gain this decade. There is a class system in this country and it boils down to the banks and the rest of the public. Time to change the system. Break these banks up and reform Wall Street. You would think the biggest economic crisis since the Great Depression would light a fire under our politicians but instead they are rewarding the culprits with a larger casino to play in.