Labor Pains

The numbers in the forecast to from the Congressional Budget Office not -- so -- all it now predicts unemployment. Will rise through next year and peek a greater than ten and a half percent that's the first time it's been that high. Our researchers in the brain room dug up some numbers this year alone. A total of 750000. Jobs cut manufacturing and construction is lost 493000. Mac continues week after week now John -- Is an editor for real clear -- markets dot com and senior economist at HC Wainwright economics my guest here in New York good morning to you. But take a look at this graphic now we can show you -- the way the jobs have moved up. A month after month if you go back to read that middle part of that chart right there in April of 2008 just a year ago right around 5%. Well I think all okay right I've just look since December. The -- of that move. It's been 600000. Plus jobs and me after we can you explain why it's been so consistent -- is -- just the way it goes when he had a recessionary time.

I think it's fairly easy to explain if you look at what's happened with the unemployment insurance offered by the federal government for the states they have continuously try to extend it and when you do that when you make it easier for workers to stay on the sidelines. Naturally there's going to be on -- higher unemployment.

Numbers if you want to get that down it's really very simple.

Take away the subsidies that allow us to be on the sidelines in which case people get jobs.

Not necessarily that they want but we'll get jobs because they need to they need to -- so -- himself.

Your position is get the government out of us. Have the feds but out. A without a doubt recessions never happened because of free markets or because -- too much capitalism and they happen because of government error. It's were asking the very government the broadest where we are somehow get get us out of recession. In fact they're making things much more error means mistakes were mistakes they make it in your view the biggest mistake I think was the weak dollar policy offered under both the bush and Obama -- administrations that invariably drives money hard assets like housing and in the commodities an away from the entrepreneurial. Growth oriented -- number I would -- city your position is that the Obama administration is not talking of the American dollar and that's hurt us. But the Bush Administration did a talk up the dollar later in and that's why the Bush Administration failed economically in my opinion they got taxes right they got the dollar very wrong and when you weaken the dollar that's the quickest way. First ball to stabilize an economy and second it's the best way to not make the electorate unhappy these are making the money in people's pockets last I don't get it I mean if if that's the case. Why would they take the position they have for the past eight and a half years there's this belief it's -- discreet it's never been proven -- it's never worked that if you do value money you can somehow increase exports around the world but the reality is all trade balances and so when you -- value money all you do is drive. Investment away. From successful growing entrepreneurial company.

Well I mean it makes estimate but apparently a lot of people disagree renewed -- there is one thing out there that I think it's a bit of a silver lining I think your viewers need to be made aware of this. Borrowing by banks over the past week was down. And the credit stress apparently was less than we have seen since September is that a suggestion that the oil in this economy start to move.

Yes it certainly suggestion that banks are -- more willing to lend that that's certainly a positive. I would have loved to have seen back in the fall for the government also let this go naturally when there are credit crunch is that's -- that's a good thing in -- sense. It -- drives down wasteful lending I think it is a positive what would have happened if the government said okay we'll sit on the sidelines. -- You know you go ahead and you know if you're if you're going bankrupt to go bankrupt. If you're unemployed won't get unemployment benefits I would be much better the situation -- first of all unemployment would be lower -- people lacking the subsidy would have gone out and gotten jobs not -- the ones they want -- I lost. -- civil and also much warmer capitalism is about success and failure if you disallow failure what you do. -- you destroy the process whereby poorly run assets don't get into the hands of good managers instead you perpetuate. Bad management techniques that actually slowdown in the economy and that's why we're in trouble today one man's -- John -- thank -- America have a great weekend the you stay right there here's -- Trying to get ready you --