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ARE WE REALLY BETTER OFF?

by David Peel on May 7, 2013

MoneyAs an injury lawyer, I help people from all walks of life, from doctors to ditch-diggers. For the last several years, the economic news has just been awful and insurance companies have been even stingier with fair injury settlement dollars.

But, in March 2013, the stock market hit a record high, barely eclipsing the prior high of October 2007. You may recall that Fall 2007 was just before the entire economy when into vapor lock and the housing sector sunk the US into the worst market since the Great Depression.

But things are much better now right? Yes and no. Yes, the stock market is much better, but what about other factors? My clients certainly are not seeing a glut of jobs available for them. Most report nothing much more than a pickup in housing sales. In fact, 2013 is the best year for the housing market since 2007!

But, if we were really improving so much, there would be a lot more jobs, much less unemployment and less folks on public assistance. Likewise, would assume that national debt would be declining as the economy roared back and that our gross national product (GDP) would be rising. But, it is troubling to look a the actual numbers:

OCT 2007 MAR 2013
Number Unemployed: 6.7 million 12.9 million
Unemployment Rate: 4.70% 7.80%
On Food Stamps: 26.9 million  47.7 million
National Debt: 9.1 trillion 16.7 trillion
Gas prices: $2.75 $3.70
GDP Growth: 2.50% 1.70%
Consumer Confidence: 99.5 69.6

 

I would explain the current economy this way: You are on a luxury cruise, and everyone is having a great time (like in 2007). Some greedy folks in the engine room have been selling off the parts to the very engine driving the enormous beast. The Coast Guard then escorts them off the ship to their island hideaways (as in the Federal bailout). You and the other passengers are set adrift and eventually run out of supplies. Every so often, helicopters drop packages with fresh food and supplies. Fresh care packages seem like great times compared to normal hopelessness of every day. That is today.

The stock market is glad to see housing finally begin to pick up speed with record-low interests rates allowing borrowing. But, fundamentally, my clients and I still want to know, where are the jobs? Are you better off than in 2007?

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