The unemployment report is released periodically and it contained a big surprise for many economists in 1996. Over the past months the reports showed the economy doing quite well. This economy has been doing so well that some economists were worried about reaching full employment rather quickly. Although the jobless would love that to happen, full employment would lead to high inflation and destruction of the economy. The consensus on Wall Street was that the Fed would have to raise rates until word got around about the report. By day's end, the mainstream were afraid of an economy that will grow so slowly that rates will have to go lower. The current unemployment rate is 5.3%. President Clinton is trying to create new jobs to get everyone earning real wages. People want to know that he is opening job opportunities but he also does not want full employment. This is a prime example of politics. Tell people what they want to hear but do not let the economy stagnate. I guess that is his hidden agenda. In effect, Clinton plans to strengthen employment and business investments in poverty stricken urban areas. He plans to triple funds to lend to city banks in order to foster economic development in poor neighborhoods. He will also try to triple employment in public housing projects through a $10 million project involving HUD, Rockefeller Foundation, and Chase Manhattan. Many Southern states, seven to be exact, are about to cut their unemployment insurance taxes by hundreds of millions of dollars. The Southern economy has seen tremendous growth and people are forgetting the bad economic times. The region has also been adding job...
