Weak Job Growth Numbers Prompt Stock SelloffJanuary 4, 2008
The unemployment rate surged to 5 percent in December as the nation added only 18,000 jobs, the smallest monthly increase in four years, the Labor Department reported on Friday. Investors responded by sending the stock market down sharply.
Economists treated the report as the most powerful evidence to date that the United States could well be falling into a recessionary downturn in economic activity.
“This is unambiguously negative,” said Mark Zandi, chief economist at Moody’s Economy.com. “The economy is on the edge of recession, if we’re not already engulfed in one.”
The swift deterioration in the job market resonated as a warning sign that troubles once confined to real estate and construction are now spilling over into the broader economy, threatening the ability of American consumers to keep spending with customary abandon.
http://www.nytimes.com/2008/01/04/business/04cnd-econ.html?_r=2&hp=&oref=slogin&pagewanted=printBush says economic foundation solidJan. 4, 2008 at 10:01 PM
WASHINGTON, Jan. 4 (UPI) -- While praising 52 consecutive months of job creation, Bush -- during remarks made after meeting with the President's Working Group on Financial Markets -- noted job growth slowed in December. A government report said employment experienced its smallest increase in more than four years last month and the nation's jobless rate hit a two-year high.
"I look forward to working with (Congress) to deal with the economic realities of the moment, and to assure the American people that we will do everything we can to make sure we remain a prosperous country," Bush said.
Among the realities facing consumers are higher prices for gasoline and food while core inflation is low, he said. Also consumer spending is strong, yet home values are beginning to decline.
One way to assist consumers is keeping taxes low, Bush said.
"If ... the foundation is strong, yet indicators are mixed, the worst thing the Congress could do is raise taxes on the American people and on American businesses," Bush said.
http://www.upi.com/NewsTrack/Top_News/2008/01/04/bush_says_economic_foundation_solid/8632/