New York, NY (PRWEB) January 14, 2009
In today's issue of Profit Confidential, a widely-read market and investment newsletter, financial expert George Leong warned readers that the continued shedding of jobs in the United States poses a very serious threat to the economy that could ultimately result in significant deflation.
In his report released today, Leong states, "People across America are losing their jobs, and I do not see any signs that it will let up in 2009. At least not for the first few quarters, until President-elect Barack Obama can somehow get his massive economic stimulus strategy approved and in motion. But like any major undertaking, this will take time and, in the meantime, we could see more jobs lost, albeit at a slower rate than in 2008."
Leong is discouraged by several recent reports on U.S. job losses. "Earlier in the week, a survey by ADP Employer Services showed the loss of 693,000 private jobs in December, adding to 476,000 jobs lost in November. Then, on Friday morning, as if things could not get worse, the December non-farm jobs report showed the loss of another 524,000 jobs in December, bringing the total of jobs lost in 2008 to a whopping 2.6 million! A positive in some people's mind is that the job losses were better than the 550,000 forecasted; but the bottom line is that the numbers were bad. There is simply no reason for optimism when there were only 26,000 fewer jobs lost!"
In an article appearing in today's Profit Confidential e-letter, Leong outlines some of the consequences of these developments. "Taking the average of men and women, the median
income was $40,107. The 2.6 million lost jobs roughly translates to $104.28 billion in lost wages. This is significant, as it could mean a major decline in consumer spending, which is not good for the struggling U.S. economy at a time when consumers need to spend." Leong is also troubled by similar economic trouble in Canada, by far America's largest trading partner. "Unless there is a quick reversal in the jobs market," he concludes, "I believe that the economy and markets will continue to struggle well into 2009. And don't forget the potential negative impact of reduced spending on prices and the surfacing of a bearish deflationary setting."
For the full report, please visit: http://www.profitconfidential.com
About Lombardi Financial and Profit Confidential:
Profit Confidential is Lombardi Financial's free daily investment and market e-letter. Written by financial gurus with over 100 years of combined investing experience, Profit Confidential analyzes and comments on the actions of the stock market, precious metals, interest rates, real estate, other investments and the economy. Lombardi Financial is a division of Lombardi Publishing Corporation, one of the world's largest newsletter companies, now with over one million customers in 141 countries.
For more information, visit: http://www.profitconfidential.com