The U.S. economy faced fresh troubles Friday as President Bush signed a $700 billion bailout bill. Analysts weigh the economic picture and Paul Solman recaps week's events.
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Even as the controversial bailout package became law today, there were more signs of economic weakening. Nationally, as we heard in the news summary, the loss of nearly 160,000 jobs last month. And from California, impact from the credit squeeze, as Gov. Schwarzenegger warned the U.S. Treasury that his state may need to borrow $7 billion just to pay for day-to-day operations.
More on all this now from Chris Hoene, director of policy and research at the National League of Cities, an advocacy group for municipal governments across the country, and Mark Zandi, chief economist at Economy.com, an economic consulting firm, who joins us from Philadelphia.
Well, Mark Zandi, break down the jobs report for us. How broad was the damage?
MARK ZANDI, Chief Economist, Economy.com:
It was broad. It was bad. We lost 160,000 jobs. We've lost 760,000 jobs since the beginning of the year.
In September, the job losses were very widespread — construction, manufacturing, transportation, retail, financial services, information services, professional services — really, it's easier to list industries that added to payrolls, and that would include health care, educational services, and government. Other than that, there was just job losses.
The actual unemployment percentage stayed the same. Explain that one again for us.
Well, it did jump very significantly in August, and I think it was just a bit of temporary respite. I think we will see the unemployment rate rise quite significantly in the not-too-distant future in the months ahead.