Saturday, May 19, 2007

According to script

Be sure to read the LA Times today, "Weak state job report adds to consumer woes":

The rise in the state unemployment rate last month stoked concerns that job worries, along with rising gasoline prices and a stumbling real estate market, could make consumers skittish about spending.

The deterioration was due in large part to the slump in home construction. The sector shed 3,000 jobs in April, contributing to an increase of 58,000 in the number of out-of-work Californians. It was the greatest one-month jump in unemployment since February 1992, when that population expanded by 69,000.

Some economists said bad news on the job front could spook consumers who are already ill at ease with paying an average of $3.46 a gallon for gasoline and seeing "for sale" signs linger in their neighborhoods. Home sales in Southern California fell to a 12-year low last month, and prices have begun to slip.

Those of us following Nouriel Roubini et al recognize the script.

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